Grain Market Update (4.10.18)
Apr 10, 2018
Yesterday’s Close: May corn futures finished yesterday’s session up 2 cents, trading in a range of 3 ¾ cents. Funds were estimated to have been buyers of 10,000 contracts on the day.
Fundamentals: We will get updated world supply and demand estimates from the USDA at 11am cst today. The range of estimates for US ending stocks is 2.067-2.265 billion bushels with the average estimate coming in at 2.197 billion bushels. Last month’s report came in at 2.127 billion bushels. World ending stocks are expected to come in from 191.5-202 million tonnes with the average estimate being 197.1. The average estimate for Brazilian production comes in at 92.7 million tonnes, this is would be down from 94.5 million last month. The Argentina crop is expected to come in near 42.6 million tonnes, this would be down from 47 million last month. Export inspections came in at a lofty 1,937,040 metric tons yesterday. The range of estimates came in from 1,150,000-1,350,000. Though we remain optimistic on corn prices we do not think today’s report is going to be a significant market mover. We are looking for the trade to digest the data quickly and move back to weather.
Technicals: Our technical resistance pocket from 391 ¾-395 ¼ is continuing to hold, perhaps today's news could give the market what it needs to move out above. This pocket represents the 50% retracement from the July highs to the January lows, along with recent highs. If the market is able to close above this pocket, we would expect to see a run back above the 4.00 handle with the next objective being 413 ¼-415. A failure to get traction above resistance could encourage some long liquidation from the funds and press us back towards....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.
Yesterday’s Close: May soybeans finished yesterday’s session up 12 ¾ cents, trading in a range of 19 ¼ cents on the day. Funds were estimated buyers of 10,000 contracts.
Fundamentals: The market seemed relieved yesterday to not get any retaliatory tariff talk from China over the weekend. Market participants will focus in on the WASDE report today but will likely turn attention back to weather quickly. The range of estimates for US ending stocks comes in from 540-625 million bushels; last month’s report came in at 555 million bushels. The average estimate for world ending stocks is at 92.9 million tonnes, a touch higher than last months report which showed 92.4. The average estimate for Brazil’s production is 115.2 million tonne, up from the 113 in last months report. The average estimate for Argentina’s production is 42.66, this would be down from last months report which showed production at 47 million tonnes.
Technicals: The market has rebounded back o the top end of the recent range after shrugging off the doom and gloom tariff talk. In yesterday’s report we talked about 1052 ¾-1060 ½ being the first resistance pocket, that is in play to start the morning. The bears must defend this on a closing basis, a failure to do so opens the door to a run back towards the highs with the next resistance pocket coming in from 1079 ¼-1082 ½. On the flip side, a failure to break out will likely encourage some long liquidation and press us back towards....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.
Yesterday’s Close: May wheat futures finished yesterday’s session up 17 ¾ cents, trading in a range of 19 cents. Funds were estimated buyers of 11,500 contracts.
Fundamentals: Winter wheat crop conditions were out after the close and showed another decline. Winter wheat is rated 30% good/excellent, this is down 2% from the previous week and marks the lowest rated crop for this time of year since 1996. Export inspections yesterday morning came in at 430,080 metric tons, this was above the top end of expectations at 400,000 metric tons. The average estimate for US ending stocks in today’s USDA report is 1.036 billion bushels, very little changed from last month’s report. Once this report is behind us we will turn the focus back to weather and the winter wheat crop. KC wheat futures will likely continue to be the leader.
Technicals: Wheat futures were able to get an extension above the 200-day moving average which opened the door to 493-495 which was the next resistance pocket in yesterdays report (high was 493 ¾). If the bulls fail to achieve a breakout above this pocket, we may see some consolidation back towards the gap left from the Sunday night open. If the market continues to feed off of momentum we could see short covering, take prices to....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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