Corn (May)

 

Yesterday’s Close:  May corn futures finished yesterday’s session up 5 ¼ cents, trading in a range of 6 ½ cents. 

 

Fundamentals:  Yesterday’s session was a silver lining for the bulls with several comparing the price action to what we saw after the March 31st, 2016 USDA report.  For those of you that don’t recall, we sold off 16 ½ cents on the report to make new contract lows, then rallied as much as 54 ¾ cents in the following 3 weeks.  Comparisons can be useful but should be taken with a grain of salt, especially with the agricultural markets that have varying fundamentals every year.  Export inspections yesterday morning came in at 1,259,267 metric tons, above the top end of expectations.  It is that time of year where market participants start to focus in on intermediate term weather forecasts, trying to interpret how that may affect the crop and development.  We will start getting weekly crop progress data from the USDA next week, those reports are released on Monday’s after the close. 

 

Technicals:  The positive price action was encouraging for bulls, but the technical damage from Friday is far from repaired.  In a market environment that has increased volatility, it is not just about one good session, it is about consecutive sessions.  We often say the bottom is a process not a point, yesterday’s price action may have been the beginning of the process, but for now is just considered relief.  Consecutive closes above previous contract lows of 361 is what the bulls need to see in the first half of the week.  If they can achieve this, perhaps we make a run back to Friday’s breakdown point from 367 ¾-370 ½. 

 

Bias:  Neutral

 

Resistance: 367 ¾-370 ½***, 380 ¼-383 ½***

Pivot: 361

Support: 356**, 350***

 

 

Soybeans (May)

 

Yesterday’s Close:  Soybeans finished yesterday’s session 12 ½ cents higher, trading in a range of 15 ¼ cents.

 

Fundamentals:  Export inspections came in at 730,806 metric tons, within the range of expectations.  The big boost for beans yesterday was on the back of the USDA announcing a sale of 828,000 metric tons of soybeans to China.  The bull camp needs to see this trend continue and avoid cancellations on these sales.  Trade rhetoric has died down again as hope for a quick fix continues to dwindle.  We have stated before and continue to believe that China has some leverage with the U.S. going into an election cycle, President Trump may bend to make a deal to garner additional support from Midwest voters. 

 

Technicals:  The market is pressing up against that psychologically significant 9.00 handle, but the more meaningful technicals come in from 903-908 ¼.  This pocket represents the 50% retracement from the contract lows (September) to the recent highs (December).  It also represents the 200-day moving average and trendline resistance that goes back to February.  Without additional positive news, this may be a tough barrier to chew through for the bulls. 

 

Bias: Neutral

 

Resistance: 903-908 ¼***, 914 ¾-917***

Support: 887 ¾-891***, 880-883**, 870-873 ½***

 

 

Wheat (May)

 

Yesterday’s Close:  May wheat futures finished yesterday’s session up 3 ½ cents, trading in a range of 12 ¼ cents.

 

Fundamentals:  Export inspections yesterday morning came in at 418,424 metric tons, within the range of expectations.  Crop progress that was released after the close showed winter wheat at 56% good/excellent, 1% above expectations.  35% of the crop was rated fair, with 9% rated poor/very poor. 

 

Technicals:  The chart is rounding out a bit after failing to get out above resistance over the last week and a half.  The market is treading near our support pocket which comes in from 450-452 ½.  A break and close below here could open the door for a retest of contract lows at 427.  On the resistance side of things, there really isn’t much of significance until 475-478.

 

Bias: Neutral

 

Resistance: 475-478****, 497 ½-504 ½****

Support: 450-452 ½***, 434 ¼-441 ¾**

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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.