Wheat Futures Rebound While Soybeans Face Lackluster Demand

Corn planting process near 8% complete
May corn futures expire on Friday
Grain futures market update

Grain futures market update

Corn (May)

Fundamentals: Corn futures manage to rally into the weekend, only to give it up in the Sunday night/Monday morning trade. Friday’s Commitment of Traders (COT) report showed funds holding a net short position of 137,571 contracts. This is far from an eye-popping position, but it’s fairly aggressive for this time of year. Crop Progress will be released after the close, market participants are expected to see planting progress near 8% complete. 

Technicals: With the market consolidating over the past 3 sessions, many of the technical support and resistance levels remain intact. 313 ¾-315 ¼ is long-term support, this is based off the continuous chart, going back to the August 2016 lows. May option expiration is Friday In a normal environment we’d use open interest to try and figure out where the magnet is for prices. Right now, that suggests somewhere between 330-335. Keep in mind this isn’t a normal environment.

Bias: Neutral

Previous Session Bias: Neutral

Resistance: 343 ¼-344 ¾**, 354-356 ¾***

Pivot: 330-332

Support: 313 ¾-315 ¼***


Soybeans (May)

Fundamentals: Soybeans continue to bleed lower on the back of lackluster demand and concerns that the “trade deal” with China is in the dumps. Friday’s COT report showed funds holding a net long position of 12,522 contracts. This is a little scary, considering they’re net long and prices are essentially at contract lows. 

Technicals: Last week we had warned of a technical breakdown taking prices to retest the contract lows of 821 “in the very near future”. We're just a stones throw away from there, we wouldn’t be terribly surprised to see a breakdown below here and a possible run at the 7 handle. Previous support is now resistance, that comes in from 842-845 ¼. The bears have full control until we see consecutive closes back above here. 

Bias: Neutral/Bearish

Previous Session Bias: Neutral/Bearish

Resistance: 854-858 ¾****, 871 ¼-875**

Pivot: 842-845 ¼***

Support: 820-821**


Wheat (May)

Fundamentals: May wheat futures are rebounding sharply in the early morning trade; the bull camp will want to see this sustained through the 8:30am open. This afternoon’s crop progress report is expected to show good/excellent conditions little changed from last week, 62%.

Technicals: 4-star technical support was tested and held last week, on a closing basis. That remains intact from 525-528 ¼. The market is now moving north, back above first resistance from 540 ½-542 ½ If the bulls can achieve a conviction close above here, we could see an extension towards 564-568 ½. 

Bias: Neutral

Previous Session Bias: Neutral/Bearish

Resistance: 564-568 ½****

Pivot: 540 ½-542 ½

Support: 525-258 ¼****, 506 ¼-512 ¼***, 491 ¾****


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