Daily Grain Technicals & Fundamentals (2.6.19)

Published on: 14:02PM Feb 06, 2019

Corn (March)

Yesterday’s Close:  March corn futures finished yesterday’s session up 1 cent, trading in a range of 4 ¼ cents.  Funds were estimated buyers of 7,000 contracts on the day.

Fundamentals:  Corn continued to trade in it’s range yesterday as the market awaits new news, that will come in the form of a USDA report, Friday morning.  U.S. production estimates are coming in and range from 14.343-14.760 billion bushels.  Yield estimates are coming in from 176.5-180.0 bushels/acre.  U.S. ending stocks are projected to come in anywhere from 1.621-1.787 billion bushels.

Technicals:  If you read yesterday’s technical section, you can skip this one.  The market continues to be a stick in the mud.  Support and resistance pockets have remained intact for the better part of the last 3 weeks.  We see that support coming in from 375 ¾-378 ½.  On the resistance side of things, 382-384 ½.  A breakout or breakdown opens the door for an additional 5 cents in short order. 

Bias: Bullish

Resistance: 382-384 ½**, 388-390 ½****

Support: 375 ¾-378 ½***, 371 ¾-372 ½****


Soybeans (March)

Yesterday’s Close:  March soybean futures finished yesterday’s session up 1 ¼ cents, trading in a range of 7 ½ cents.  Funds were estimated buyers of 4,000 contracts on the day.

Fundamentals:  Soybeans have been consolidating as we await Friday’s USDA report.  Early estimates for U.S. production range from 4.490-4.620 billion bushels.  Yield estimates range from 51.0-52.5 bushels per acre.  The average estimate for U.S. ending stocks is near .925 million bushels.  The USDA did announce a sale of 2,600,000 metric tons to China and another 274,000 to “Unknown” (likely China).  This was good news but shrugged off by the market.

Technicals:  The bulls and the bears are at a stalemate as we await a fundamental catalyst to help give the market a new technical direction.  The market continues to hover around the 200-day moving average and key retracement from 919-921 ¾, a pivot pocket for us.  First meaningful support comes in from 910 ¾-913 ¼.  If the market breaks below here, we could see prices work towards 897-899 ½.  This is a pocket where we would want to be aggressive buyers on the first test. 

Bias: Bullish

Resistance: 931 ¼**, 941-947****

Pivot: 919-921 ¾

Support: 910 ¾-913 ¼***, 897-899 ½****


Wheat (March)

Yesterday’s Close:  March wheat futures finished yesterday’s session up 2 ¼ cents, trading in a range of 7 ¾ cents.  Funds were estimated buyers of 1,500 contracts.

Fundamentals:  Wheat futures continue to chop around as we anxiously await Friday’s USDA report.  The average analyst estimates for U.S ending stocks comes in at .989 billion bushels.  Total wheat acres are estimated to be 32.128 million.  We will be watching corn and beans close for the remainder of the week as it will likely spillover into wheat and provide a headwind or a tailwind for prices. 

Technicals:  The market continues to linger towards the top end of our resistance, a pocket that we have had define as 529-530.  If the bulls can chew through this pocket, we would not be surprised to see a leg higher on the back of short covering.  The next meaningful resistance doesn’t come in until 537 ¾-541 ¾.  On the support side of things, 518 ¾-521 ¼ is the pocket the bulls need to defend on a closing basis. 

Bias: Bullish

Resistance: 529-530***, 537 ¾-541 ¾****

Support: 518 ¾-521 ¼***, 508-510**, 499-501 ¼****


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