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Fundamentals: Corn futures subsided yesterday as the bullish headlines started to dissipate as we work our way into the low volume holiday trade. Yesterday’s weekly ethanol report showed production dropped 8,000 barrels per day to 1,064,000 barrels per day. Weekly export sales came in at 1,709,400 metric tons, a marketing year high.
Technicals: In yesterday’s report we moved our bias from Neutral/Bullish to outright Neutral, as prices worked against our resistance pocket, 388 ½-390 ½. This pocket represents previously important price points, including the breakout point from the September 30th quarterly stocks report, and then support during the October USDA report. In yesterday’s report we suggested reducing or hedging in preparation for a temporary pullback, that mindset remains intact today....Sign up for your FREE two-week trial!
Fundamentals: November soybeans were lower for much of yesterday’s session but managed to rally into the close to finish near unchanged. The bullish headlines have seemingly run their course, which is part of the reason why we changed our near-term bias from Neutral to Bearish in yesterday’s report. Export sales this morning came in at 1,430,600 metric tons, up 36% from last week and 18% above the 4-week average.
Technicals: The market held our 4-star technical resistance pocket nearly perfectly over the last two sessions, we have had that defined as 928 ½-930 ¼. This pocket represents a key retracement from the contract lows to the October double top highs, along with a gap and the breakdown point from November 11th. The market was overbought near term and against technical resistance, with positive headlines dying out it looks like a great spot to give the short side a shot from the risk/reward perspective. Minor support comes in from 918 ¼-920 ¼, if the bulls fail to defend this pocket, we could see the selling pick up, taking us closer to....Sign up for your FREE two-week trial!
Chicago Wheat (March)
Fundamentals: Chicago wheat futures gave back some ground yesterday but are reclaiming some of that this morning, with help from a good export number. Export sales came in at 868,600 metric tons, a marketing year high and 95% better than the 4-week average. This would explain the strength we saw at the beginning of the week.
Technicals: The market worked lower yesterday but managed to hold our pivot pocket form 544-546 ½, this was previously resistance and now becomes support. IF we see the market breakdown below here, we would expect to see the selling accelerate. First resistance comes in from 556 ¾-557 ¼, consecutive closes above here could take us to....Sign up for your FREE two-week trial!
Kansas City Wheat (March)
Technicals: Kansas City wheat futures tried to trade lower yesterday but found support near our pivot point (the 200 day moving average), 459 ½. The bulls will want to continue to defend this area, a close below could encourage some profit taking from recent buyers, taking us back to 449 ½-451 ¼. We do not want to be short the Kansas City contract at all, so we moved our bias from Neutral/Bullish to Neutral yesterday. If you want to be short wheat, consider....Sign up for your FREE two-week trial!
Fundamentals: Export sales this morning came in at 249,400RB, this was down 10% from the previous week but up 5% from the 4-week average.
Technicals: The chart is starting to resemble that of a bull flag, consolidating with lower highs and higher lows after a big leg higher last week. If the bulls can breakout of the pennant formation, we could see a run to new highs on the move. Our bias has been outright Neutral for some time now, but that may be changing soon. The holiday trade has us reluctant....Sign up for your FREE two-week trial!
Feel free to contact Oliver with any questions or comments
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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.