Daily Grain Market Update (7.6.18)

Published on: 13:17PM Jul 06, 2018

CORN (December)

 

Yesterday’s Close:  December corn futures finished yesterday’s session down 1 ¼ cents, trading in a range of 7 ½ cents.  Funds were estimated buyers of 1,000 contracts.

 

Fundamentals:  The weekly EIA ethanol report showed production dropped to 1.067 million barrels per day.  Despite the drop, production levels remain relatively high, 5.2% over last year.  Informa Economics raised their U.S. corn yield estimate to 176 bushels per acre, up 1.5 bushels per acre; this puts production at 14.392 billion bushels.  The USDA announce a sale of 137,000 metric tons of corn to South Korea for 2018/2019.  Export sales this morning came in at 672,800 metric tons, below the expectations of 750,000-1,400,000 metric tons.

 

Technicals:  Corn future took out the June 19th lows on Monday and are trying to build a base off of 360, remember that the bottom is a process not a point.  The bulls need to defend 358-360 on a closing basis, a break and close below will delay the bottoming process yet again.  The bulls still have a lot of work to do, a close above....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

 

SOYBEANS (November)

 

Yesterday’s Close:  November soybeans finished yesterday’s session down 9 ¾ cents, trading in a range of 12 ¾ cents.  Funds were estimated sellers of 5,000 contracts on the day.

 

Fundamentals:  The trade war has officially started, and futures are so far mute.  This isn’t all that surprising, this is old news, and with exports being paid for on arrival the Chinese pipeline had already been drying up.  Informa Economics raised their projections for U.S. yields to 49.8 bushels per acre, up .3 bushels per acre.  They have total production at 4.425 billion bushels.  Export sales this morning came in at 1,020,300 metric tons, above the range of expectations of 400,000-1,000,000 metric tons.

 

Technicals:  The market traded and closed below the June 19th lows, something that the bull camp did not want to see happen.  A break below those lows met by buying would have been most ideal for beginning a bottoming process.  The slow bleed lower has created a “buyers strike” and keeps long holders around for another day.   At these levels, the market is.....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

 

WHEAT (September)

 

Yesterday’s Close:  September wheat futures finished yesterday’s session up 14 ½ cents, trading in a range of 12 cents (gap higher).  Funds were estimated buyers of 8,500 contracts.

 

Fundamentals:  September wheat futures caught a bid yesterday on renewed concerns regarding production in areas like the Black Sea and Europe.  If these concerns start to expand we will likely see the market rally.  We are in the camp that these concerns will eventually subside and provide a good selling opportunity.  Export inspections this morning came in at 440,100 metric tons, inline with expectations of 250,000-500,000 metric tons. 

 

Technicals:  The market reclaimed ground above the 200-day moving average with some conviction.  Previous resistance now becomes first support, we see that as 496 ¼-500.  Just below that is a gap from 490 ¾-493.  On the resistance side of things, there are several hurdles from....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

 

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