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-Markets have a normal session on Wednesday, are closed Thursday, and re-open at 8:30 AM CT Friday.
-If you are long December grain futures, you will want to be flat or roll by Friday’s close to avoid the risk of delivery.
Fundamentals: March corn futures are a stone's throw away from the contract highs they posted two-weeks ago. Strong demand has continued to be the fuel to funds piling in on the long side of grain markets. Friday’s Commitment of Traders report showed funds reduced their net long position for the second consecutive week, this time to the tune of 715 contracts; they are still holding a net long position of 268,110 contracts.
Technicals: With December corn options off the board, the focus and volume will continue to shift towards the March contract. 435 ¾ is the contract high, posted on 11/11, this is the first resistance. A breakout and close above here puts us back in uncharted territory, where it becomes much more difficult to find meaningful resistance. First support, our pivot pocket, comes in from 428-432. The Bulls remain in full control of the technical landscape as higher highs and higher lows continue. The RSI (relative strength index) is at 68.40, approaching what is considered “overbought territory”.
Previous Session Bias: Bearish/Neutral
Resistance: 435 ¾
Support: 408 ¾-413 ½****, 396-399 ½***
Fundamentals: Less than expected rainfall in Brazil over the weekend had soybeans surging higher on the Sunday night open. There are some scattered rains expected this week in Brazil and Argentina. South American crop development will continue to be monitored closely. Friday’s Commitment of Traders report showed funds sold 11,857 contracts through November 17th, trimming their net long position to 200,123 contracts.
Technicals: Beans in the pre-teens! January beans gapped higher last night, taking prices to the psychologically significant $12.00 handle, the highest price since June 10th, 2016. 1208 ½ was the spike high from that year, a trade above here would put us at the highest price since June 30th, 2014. Our bias remains Neutral as we sit back and enjoy the spectacle of this latest surge. We have missed an incredible move over the last three weeks, it is not the first time and will not be the last. As mentioned last week, this is an environment where there are 50 cents of risk on either side of the market, over a short period of time. Prices are on pace to mark their 14th higher close, in the last 15 sessions. The RSI is at 82.61, this is considered “overbought territory”, but were as high as 87.45 in September.
Previous Session Bias: Neutral
Resistance: 1200-1208 ½**
Support: 1154 ¾-1161 ¾***, 1138**, 1114 ¼-1120 ¼****
Chicago Wheat (March)
Technicals: Chicago wheat futures are higher in the early morning trade, benefiting from some spillover strength in corn and beans. With that said, the inability to work towards new highs despite the strength in corn and beans should be a bit of a caution flag for the Bull camp. We have been leaning on the short side, but in Friday’s report, we recommended tightening things up ahead of the weekend. We are now back at trendline resistance which is a spot to look back on the short side. A conviction breakout above 611 ¾ would neutralize our near-term bias.
Previous Session Bias: Bearish
Resistance: 608 ¾-611 ¾****, 619 ½-621***
Support: 596 ¾-599 ¼***, 589 ¼-592 ¾***, 580 ¾***
Reach out to learn more about our new Ag Trade Alerts program and how we are positioning for hedgers and speculators.
Call/Text/Email, Oliver with any questions.
Oliver@BlueLineFutures.com and 312-837-3938
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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.