Blue Line Express

Weekend Ag Update (Grains & Livestock 8.19.18)

Corn

 

Last Weeks’s Close:  December corn futures finished Friday’s session down ¾ of a cent, trimming gains for the week to 7 ¾ cents after trading in a 16 ½ cent range.  Friday’s Commitment of Traders report showed funds sold 7,886 futures through August 14th, increasing their net short position to 60,139 futures.

 

Quick Take: Corn futures have recovered nearly all their losses from the USDA report on August 10th, a rather impressive feat considering the lofty numbers put out there.  Early last week we mentioned that the USDA may have set the bar a little high, leading to an over promise and under deliver scenario.  With that said, you have to trade the market you have, not the one you want.  We would likely to be friendly the market but lack the conviction due to lofty production numbers and a sketchy chart, this has our bias stuck in neutral for the start of the week.  Check out tomorrow’s Grain Express for the full technical breakdown.  If you’d like that forwarded to you in the morning, please email Oliver@BlueLineFutures.com.

 

Soybeans

 

Last Week’s Close:  November soybean futures finished Friday’s session up ¾ of a cent, narrowly extending gains for the week to 37 cents after trading in a range of 48 ¼ cent range.  Friday’s Commitment of Traders report showed funds bought 832 futures through August 14th, cutting their net short position down to 62,234 futures. 

 

Quick Take:  The market has reclaimed nearly all the lost ground from the USDA report sell off on August 10th, thanks to headlines suggesting that the U.S. and China may be close to striking a deal.  The market seems optimistic, more so than we are.  The trade talks remind me a lot of my high school relationships, one week we are talking, the next we aren’t.  We expect the headlines (positive/negative) to keep flowing, keeping volatility relatively high, which in our eyes will continue to present some great short-term trading opportunities.  Check out tomorrow’s Grain Express for the full technical breakdown.  If you’d like that forwarded to you in the morning, please email Oliver@BlueLineFutures.com.

 

Wheat

 

Last Week’s Close:  December wheat futures finished Friday’s session up 17 ¼ cents, putting futures in positive territory by 10 ½ cents for the week, this after trading in a range of 33 ¼ cents.  Friday’s Commitment of Traders report showed funds sold 1,125 futures through August 14th, trimming their net long position to 65,226 futures.

 

Quick Take:  Wheat futures started last weeks trade with some follow through pressure, but buyers were willing and able to step back in as the market failed to breakdown below some significant technical levels.  We have been more pessimistic on wheat than most recently, that hasn’t change much over the last week.  It’s ok if you disagree with us, just don’t fall into the trap of seeking affirmation instead of information.   Check out tomorrow’s Grain Express for the full technical breakdown.  If you’d like that forwarded to you in the morning, please email Oliver@BlueLineFutures.com.

 

Live Cattle

 

Last Week’s Close: October live cattle futures finished Friday’s session up 1.975, extending gains for the week to 3.025, this after trading in a range of 3.70 for the week.  Friday’s Commitment of Traders report showed funds sold 211 futures through August 14th, trimming their net long position to 54,941 futures.

 

Quick Take: Coming into the week were pretty bulled up as the market worked against significant support which we had listed as 107.50-107.90, this pocket represented trendline support from May 17th, June 15th, July 11th, and again on Monday.  This pocket also contains a key retracement on the year and the 100-day moving average.   We were wanting to see more of a springboard reaction and a breakout above 109.55, we didn’t get what we were looking for, so we started turning more neutral by mid-week.  That breakout finally came Friday, and we weren’t as long as we would have liked to have been but that’s just the way it goes.  Last minute headlines of positive trade talks and steady cash helped spark Friday’s move. 

 

Feeder Cattle

 

Last Week’s Close:  October feeder cattle futures finished Friday’s session up 1.80, extending gains for the week to 2.275, this after trading in a range of 4.25.  Friday’s Commitment of Traders report showed funds sold 527 futures through August 14th, trimming their net long position to just 344 futures.

 

Quick Take:  Feeder cattle futures had been trading in between the 100 and 50 day moving average for seven consecutive sessions, they finally broke out of that range Friday afternoon.  The bull camp needs to see consecutive closes above here to confirm the move, a failure to do so could invite sellers back in and at better prices.  The bears still have an advantage on the chart, but a move out above 153.45 would turn the tide.  First support for tomorrow comes in from 150.45-150.00.  If you’d like that forwarded to you, please email Oliver@BlueLineFutures.com.

 

Lean Hogs

 

Last Week’s Close:  October lean hogs finished Friday’s session up 3.225, extending gains for the week to 7.50, this after trading in a range o f 7.95.  Friday’s Commitment of Traders report showed funds bought 5,635 futures through August 14th, trimming their net short position to 6,405 futures.

 

Quick Take:  Lean hog futures have seen an extensive amount of short covering over the last week.  Rumors had been circulating that we could see positive news regarding trade, that escalated Friday afternoon with suggestions that U.S. and Mexico could have an agreement by the middle of next week.  Over the past few weeks we had suggested buying call options for those who wanted to be long, giving you good upside exposure with a defined risk.  If you are still holding those we would suggest taking them off since premiums are “juiced” right now.  First resistance for tomorrows session comes from 59.65-60.40, this pocket represents the 100-day moving average and the 50% Fibonacci retracement (middle of the range) from the February highs to the August lows.  Check out tomorrow’s Livestock Roundup for the full technical breakdown.  If you’d like that forwarded to you, please email Oliver@BlueLineFutures.com.

 

 

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If you have any questions or would like to discuss the markets in more depth, please do not hesitate to call or email.

 

Oliver@BlueLineFutures.com

Direct: 312-837-3938

 

 

Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.