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Grain & Cotton Express

 Corn (March)

 

Fundamentals:  Corn futures finally caught a bid, when it seemed the morale of the bull camp was at all-time lows.  Export sales yesterday came in at 873,500 metric tons, 60% better than last week and 28% better than the 4-week average.  The better news came in shortly after 8am CT, the USDA announced a sale of 1.6mt to Mexico and another 110,000 to “Unknown”.  THIS is what the bulls need to see more of to stage a meaningful rally.  On top of good export news, we got reports that the December 15th tariffs would be off the table and current tariffs cut.  China doesn’t buy a lot of Corn, but it spurred broad based buying/short covering in the grain sector. 

 

Technicals: The market sprang higher yesterday and in the overnight session on short covering, taking prices to our resistance pocket from 381 ¼-382 ¾.  The bulls need to see a conviction close above this pocket to encourage additional short covering, a failure to do so could take us back to fill the overnight gap and retest our pivot pocket....Sign up for your FREE two-week trial!

 

Soybeans (January)

 

Fundamentals:  January soybeans were under pressure early yesterday but managed to climb higher on renewed trade optimism.  Reports are that the December 15th tariffs are off the table (still not official) and current tariffs would be reduced.  After the close there were reports that China has agreed to buy 50 billion in US agricultural products in 2020.  It is a big, bold, and flashy number, but seems far fetched when you look at historical purchases.  If the administration came in lower, most headlines would read that we are just back to normal.  Similar to a doctor taking a baseball bat to your leg, then putting a cast on it and saying he fixed it.  Don’t get me wrong, we need to be tough on trade and China, but we are skeptical of the 50 billion.

 

Technicals:  Soybean futures filled the gap from December 6th at 889 yesterday morning and looked like we were going to see the selling accelerate.  Then headline risk happened, and we sprang higher.  That headline risk kicked into overdrive after the close which prompted a gap higher and run at our resistance pocket from 909 ½-913, which is where we have stalled out.  This pocket represents the 100 and 200 day moving average, a key retracement, and the breakdown point from November 20th.  If the bulls can achieve consecutive closes above here, we could see an extension towards....Sign up for your FREE two-week trial!

 

Chicago Wheat (March)

 

Fundamentals:  Chicago wheat futures sprang higher yesterday on the back of broad-based buying in the grain sector.  Export sales came in at 502,700 metric tons, 33% above the 4-week average, adding to the optimism.  The US Dollar at multi-month lows certainly helps too. 

 

Technicals:  The market stalled lagged in the overnight session as beans and corn continued to rip higher on trade optimism.  If we see prices subside there, we could see that spill over into the wheat market.  525 ¾-529 ¼ is our pivot pocket, a close below here would take us back to....Sign up for your FREE two-week trial!

 

Kansas City Wheat (March)

 

Technicals:  Kansas City wheat surged higher yesterday, ripping through first resistance which encouraged a wave of short covering, taking prices to our next resistance pocket in the overnight session.  We have defined that as 449 ½-451 ¼.  If the bulls can chew through this pocket, we would expect to see additional short covering take us out above....Sign up for your FREE two-week trial!

 

Cotton (March)

 

Fundamentals:  The market jolted higher yesterday and is seeing moderate follow-through today; the bulls need to see this hold going into the weekend.  A lot of the momentum came on the back of positive trade developments, but we are still waiting on more concrete details.  Export sales yesterday came in at 277,100 RB, 69% better than last week and 9% higher than the 4-week average.

 

Technicals:  The market closed a hair above our 4-star resistance pocket, the top end of that coming in at 67.13.  This now becomes support.  The bulls need to defend this area to keep the momentum in their favor.  If they can do that, the next objective would be....Sign up for your FREE two-week trial!

 

 

Feel free to contact Oliver with any questions or comments

Call or Text: 312-837-3938

Email: Oliver@BlueLineFutures.com

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.

 

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