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Fundamentals: Last week’s USDA report fit right inline with what we have seen historically, a dud. The lack of new market moving information will keep the near-term focus on weather in the Midwest and money flow. Crop progress will be out after the close, we are not expecting that to have a huge influence on the market at this point. Friday’s Commitments of Traders report showed funds are net long 379,642 contracts, a reduction of 8,056 contracts.
Technicals: May corn futures made new contract highs on Friday but finished the session in negative territory. Though this is not the type of price action that the Bull camp wanted to see, it did not do any technical damage to the chart. Previous resistance is now support; we have outlined that as 559-564 ¼. A break and close below this pocket would neutralize our near-term bias. Technical resistance comes in from 595-600. That pocket represents Fridays high and the psychologically significant $6.00 handle.
Previous Session Bias: Bullish/Neutral
Resistance: 585*, 595-600*
Support: 559-564 ¼****, 550**, 536-540***
Fundamentals: The market finished Friday’s trade with some weakness, which has spilled into the overnight and early morning trade. Last week’s USDA report did little to add conviction to the Bulls/Bears, so we would not be surprised to see the rangebound trade continue. Money flow will be a key driver in this week’s trade. Friday’s Commitments of Traders report showed funds added a net 7,368 contracts, expanding their net long position to 141,143 contracts.
Technicals: Chicago wheat futures consolidated much of last week but are threating to breakdown below technical support in the early morning trade. We have defined that as 1390-1400. If the Bull camp fails to defend this pocket it would neutralize our near-term bias and potentially lead to a retest of the bottom end of the recent range, 1364 ¼-1364 ¾.
Previous Session Bias: Neutral/Bullish
Pivot: 1434 ½-1436 ½
Support: 1390-1400**, 1364 ¼-1364 ¾**
Chicago Wheat (May)
Technicals: Chicago wheat futures broke out above our pivot pocket on Friday, we have defined that as 626-631 ½. That opened the door for a run at our next resistance pocket, 644 ½-649 ½ (Friday’s high was 646 ½; a blind squirrel finds a nut every once in a while!). Those technical levels remain intact to start this week’s trade. A break back below our pivot pocket would neutralize the positive technical developments over the last week.
Previous Session Bias: Neutral
Resistance: 644 ½-649 ½***, 657 ¾-662 ¾**
Pivot: 626-631 ½
Support: 596 ½-600**, 569-572 ¾*
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Blue Line Futures
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.