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Daily Grain & Cotton Commentary

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Corn (December)

Fundamentals: Corn futures retreated yesterday morning on the back of harvest pressure, profit taking and no new news. Due to Columbus Day on Monday, export sales were pushed back to Friday. Price precedes news, we continue to put an emphasis on money-flow and technicals, that will tell the story of how harvest is going.

Technicals: The market pulled back to our pivot pocket near 390, a spot that we wrote about in yesterdays report saying, this would be the spot to consider getting that long exposure back on.. The trend has been higher lows followed by higher highs, so we view pullbacks as buying opportunities and rallies as a chance to reduce exposure.

Bias: Bullish

Previous Session Bias: Bullish

Resistance: 400-402 ***, 412 -417 ****

Pivot: 390-392

Support: 377-381 ****, 363-366***

Soybeans (November)

Fundamentals: Soybean futures continued to pullback yesterday on a wave of profit taking as bulls run out of supportive headlines to propel the market higher. Due to Columbus Day on Monday, export sales were pushed back to Friday. We remain optimistic on prices as questions regarding production continue to mount. Trade rhetoric has fell flat time and time again, but thats not to say we wont see more positively spun headlines in the coming weeks.

Technicals: Futures came within a stones throw of our first support pocket, we have defined that as 920-924, a spot that we said yesterday holds value to the buy-side. Money-flow has been extremely encouraging across the grain sector over the last month and a-half, that can be seen on the charts of corn, soybeans, and wheat, higher lows followed by higher highs.

Bias: Bullish/Neutral

Previous Session Bias: Bullish/Neutral

Resistance: 948-950****

Pivot: 936 -938

Support: 920-924**, 899-906 ****, 879 -882 ***

Chicago Wheat (December)

Fundamentals: Chicago wheat bucked the trend and traded higher during yesterdays session as fundamentalists point to hopes of improving demand. Due to Columbus Day on Monday, export sales were pushed back to Friday. Money-flow in grains is something weve been noting for the last month and a half, that continues to be a huge positive that is helping to drive technical short covering.

Technicals: The market pulled back into our technical support pocket from 500-506 , in yesterdays report we said: If youre bullish the market, this is the area to consider adding long exposure. If youre bearish the market, this is the pocket to reduce short exposure in. Higher lows and higher highs have been the trend, we would not be surprised to see that continue.. The market has made those higher highs in the overnight session, but the bulls need to see confirmation when the floor opens, and we get more participation.

Bias: Neutral/Bullish

Previous Session Bias: Neutral/Bullish

Resistance: 525 -531 ****

Pivot: 515 **

Support: 500-506 ****, 483-486 ***, 476 ****

Kansas City Wheat (December)

Technicals: In yesterdays report we wrote, The market has pulled back into first support, we have defined that as 415 -420, we see value at these prices so long the market doesnt break down below.. The bulls managed to defend that pocket and now prices are back up against resistance from 428-432 , this is the breakdown point from the August 12th USDA report. Just above that is 437-440 which represents a key retracement and the 100-day moving average.

Bias: Bullish

Previous Session Bias:Bullish

Resistance: 428-432 ****, 437-440**

Support: 415 -420**, 397-400***, 380*

Cotton (December)

Fundamentals: Cotton futures managed to rally yesterday on the back of technical support and concerns that weather could deteriorate quality as we work our way through the harvest, which is estimated to be about 1/3rd complete. Due to Columbus Day on Monday, export sales were pushed back to Friday. We remain optimistic on prices as fundamentals and technicals continue to look very constructive.

Technicals: The bulls were able to defend support near 62.50 earlier in the week which encouraged additional short covering and new buyers to step in. That buying activity has take prices back to our 4-star resistance pocket from 65.00-65.85, a spot to consider reducing if you had bought earlier in the week. If the bulls can chew through resistance, we could see an extension towards 68.35-68.60 in a relatively short amount of time.

Bias: Bullish

Previous Session Bias:Neutral/Bullish

Resistance: 65.00-65.85****, 68.35-68.60***

Support: 61.72-62.50****, 59.58-60.79***, 56.59-57.55****

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About the author

Oliver Sloup is Vice President of Blue Line Futures, a leading futures and commodities brokerage firm located at the Chicago Board of Trade. Blue Line Futures mission is to put the customer first, and that means bringing YOU the best customer service, consistent and reliable research and state of the art technology.  Oliver has been a guest on CNBC and Bloomberg, among others.  Oliver has over a decade of trading experience. Prior to Blue Line Futures, Oliver worked as the Director of Managed Futures at iiTRADER.



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