Fundamentals: December corn futures tried to rally in yesterday’s session but fell flat as the market feels like it wants to catch its breath. The USDA announced a sale of 350,000 metric tons to China and 106,000 metric tons to Japan, both for 2020/2021. This is roughly 18 million bushels of corn. Weekly export inspections yesterday morning came in at 879,000 metric tons, towards the top end of expectations. Crop Progress showed good/excellent conditions at 60%, 1% below last week, as expected. Futures are slightly softer this morning, if the Bull camp fails to find strength when the floor opens, we could see long liquidation take us back to technical support (see below).
Technicals: Corn futures shopped around in a relatively narrow range, yesterday. The RSI (relative strength index) remains in overbought territory, with a reading of 72.11 at yesterday’s close. Our next resistance pocket remains intact from 373-377 ¼. This pocket represents Support in February and the breakdown point from March, as well as the 50% retracement (middle of the range) from contract highs to contract lows. Previous resistance now becomes first support, we see that as...........Please sign up for a Free Trial at Blue Line Futures to have our entire technical outlook, actionable bias, and proprietary levels emailed each morning.
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Fundamentals: The USDA announced a sale of 129,000 metric tons to China and another 318,000 metric tons to “unknown” (likely China). This is roughly 16.4 million bushels of beans, a great way to start the week. Weekly export inspections came in at 1,284,000 metric tons, within the range of expectations. Crop Progress showed good/excellent conditions at 63%, a 2% drop from last week, and 1% more than expectations. NOPA crush will be out this morning, expectations are near 169.468 million bushels. This would be nearly 2% lower from the last report, but still a record for August.
Tehcnicals: November soybean futures posted a new contract high Sunday night, but failed to find follow-through momentum when we got more participation on the floor open, indicating that the market may be ready to catch its breath. The RSI (relative strength index) was at 85.79 as of yesterday's close, the most overnight this contract (Nov. 2020) has been. With the market making new contract highs, we are in uncharted territory, which makes finding the next meaningful resistance pocket a bit of a fool’s errand. Previous resistance now becomes support, we see that as 980-982 ¾. We are anticipating.......Please sign up for a Free Trial at Blue Line Futures to have our entire technical outlook, actionable bias, and proprietary levels emailed each morning.
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Chicago Wheat (December)
Fundamentals: Yesterday morning’s export inspections report came in at 637,000 metric tons, within the range of expectations. Yesterday’s crop progress report showed spring wheat harvest at 92% complete, in line with expectations and historical averages. Winter wheat is estimated to be 10% complete. We continue to believe that global supply will be a hindrance to upward mobility in the intermediate-term. Strength in corn and beans over the last week has likely helped offer some spillover support to wheat, if they turn, we could see a technical breakdown.
Technicals: Wheat futures are lingering near our first technical support pocket; we have had that defined as 540-542 ½. This pocket represents a key retracement, previously important price points, and the 200-day moving average. A break and close below this pocket could accelerate the selling and take us back towards 526 ½-530. First resistance remains intact from 554 ½-557 ½. We believe the.......Please sign up for a Free Trial at Blue Line Futures to have our entire technical outlook, actionable bias, and proprietary levels emailed each morning.
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