Daily Grain Market Update (7.27.18)
Jul 27, 2018
Yesterday’s Close: December corn futures finished yesterday’s session up 2 ¼ cents, trading in a range of 5 ½ cents. Funds were estimated buyers of 6,000 contracts on the day.
Fundamentals: The market opened higher yesterday on spillover strength from soybeans on positive news regarding trade from the EU. That strength in the beans subsided which led to profit taking in corn against technical resistance (see technicals below). Weekly export sales yesterday morning came in at 338,500 metric tons for 2017/2018 and 747,500 metric tons for 2018/2019. Weather is still being monitored but is playing a diminishing roll as we round out the month of July.
Technicals: Corn futures tested the top end of our 3-star resistance pocket, which we have had defined as 376 ¼-379 ¼ for over a month. In yesterday mornings report we stated: “We remain optimistic on prices, but this wouldn’t be a bad spot to peel back some long exposure.” The market has peeled back and is now testing our minor support pocket from 372 ¼-374. If you had reduced long exposure, this would be a spot to consider dipping the toes back in.
Resistance: 376 ¼-379 ¼***, 387 ¾**, 394-398 ½****
Support: 372 ¼-374**, 363 ¼-366***, 345 ½-350**
Yesterday’s Close: November soybean futures finished yesterday’s session down 2 ¾ cents, trading in a range of 11 ¼ cents. Funds were estimated sellers of 5,000 contracts.
Fundamentals: The market came out of the gate strong yesterday, thanks to positive news on the trade front with the EU. However, the idea that the EU would step in and buy more U.S. beans was largely known and something we have been writing about for weeks now. The market stalled out at technical resistance which led to a round of long liquidation. Yesterday’s weekly export sales came in at 538,100 metric tons for 2017/2018 and 963,800 metric tons for 2018/2019.
Technicals: The market tested and failed against our 3-star technical resistance pocket which we have outlined as 897 ¾-901 ¾. In yesterday’s report we mentioned: “If you have been able to ride the wave for the last week and half, this is the spot to take some risk off the table.”. The market has pulled back into first support which could offer an opportunity to dip the toes back in on the long side. If the bulls can continue to defend support and eventually achieve consecutive closes above resistance, we would not be surprised to see an extension towards....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and actionable bias and levels.
Yesterday’s Close: September wheat futures finished yesterday’s session down 6 ½ cents, trading in a range of 21 ¾ cents. Funds were estimated sellers of 7,500 contracts.
Fundamentals: The market started yesterday’s session on a continuation from the previous day’s trade where we saw limits tested. The absence of additional bullish news led to a round of profit taking which has spilled over into the overnight and early morning trade. Concerns over production loss in the EU and the Black Sea region have offered support, but much of that is likely priced in at this point. Yesterday’s weekly export sales this morning came in at 385,900 metric tons for 2018/2019.
Technicals: The market tested and failed our rare 4-star resistance level from 550-553 ¾ but failed to attract additional buyers. This pocket represents the shoulders from the “head and shoulder” formation from early May and the middle of June. The inability for the market to see follow through momentum after the market tested limit up is always a caution flag for any market (see cattle futures). Previous resistance now becomes first support, we see that as....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and actionable bias and levels.
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