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USDA Day!


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Corn (September)

Fundamentals: Corn futures rallied hard yesterday, erasing losses from the back half of last weeks trade, that momentum has carried over into the early morning trade. This momentum comes on the back of short covering ahead of todays USDA report, out at 11:00am CT. Keep in mind that it is also the end of the month and quarter, which could be encouraging additional position squaring. You can find the estimates at the bottom of this report. Export inspections yesterday morning came in at 1.2mmt, this was at the top end of trade estimates. There were also rumors that China was in the market for US corn, this could just be analysts looking for an after the fact reason for the pop. Yesterdays Crop Progress report showed good/excellent conditions at 73%, 1% higher than last week and inline with expectations.

Technicals: September corn futures have clawed back some of the recent losses, taking us back to the breakdown point and our resistance pocket near 330 . If the Bulls can achieve a close above this pocket today, we could see additional short covering propel the market back towards the recent highs, something that seemed nearly out of the question just a few days ago. A failure at this pocket keeps the bears in control. Our bias remains Neutral ahead of todays report.

Bias:Neutral

Previous Session Bias:Neutral

Resistance: 338 -339***

Pivot: 328-330

Support: 314 -317 ****

Soybeans (November)

Fundamentals: November soybean futures made new lows for the move yesterday but managed to finish the day near unchanged. The market is moving higher in the early morning trade as some traders see value at these prices into todays USDA report. You can find the estimates at the bottom of this report. Export inspections yesterday morning came in at 325 tmt, nothing to write home about. Yesterdays Crop Progress report showed good/excellent conditions at 71%, 1% higher than last week.

Techncials: Soybean futures broke below the low end of the most recent range last week, accelerating the selling pressure down to our 4-star pivot pocket which we defined as 855-860 in yesterdays report. As mentioned in the Tech Talk video over the weekend, we believe this area represents value from a risk/reward perspective, but the Bulls must defend it on a closing basis. A failure to defend this area could open the door for another leg lower, 838-840 being the next meaningful support pocket.

Bias: Neutral/Bullish

Previous Session Bias:Neutral/Bullish

Resistance: 877 -882 ***, 902***

Pivot: 855-860****

Support: 836 -840 ****, 830-831**

Chicago Wheat (September)

Fundamentals:Chicago wheat futures snapped back yesterday, erasing much of Fridays loss. Export inspections came in at 515tmt, within the range of expectations. Crop Progress showed winter wheat harvest is 41% complete and the crop has a good/excellent rating of 52%. Good/excellent conditions for spring wheat came in at 69%, a 6% drop from last week. Todays USDA report will be out at 11:00am CT.

Technicals: The wheat chart has been controlled by the bears for the better part of the last 3-months, and there is nothing over the last week that has changed that. Our bias remains Neutral as we see the risk of a relief rally offsetting potential downward movement. Previous support became minor resistance at 481, this will act as a pivot pocket going forward. The more significant resistance pocket will come in from 497-502 . Consecutive closes above this pocket would neutralize the technical landscape.

Bias: Neutral

Previous Session Bias:Neutral

Resistance: 497-502 ****

Pivot: 481

Support: 471-475***

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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.

 

 

Contributing author since 10/6/17 

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