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Yesterday’s Close: May corn futures finished the day down 1 cent, trading in a range of 2 ¼ cents. Funds were estimated sellers of 3,000 contracts.
Fundamentals: Yesterday’s weekly EIA ethanol report showed ethanol production at 1.057 million barrels per day, this was a bump of 13,000 barrels per day from the previous week. Ethanol production continues to hang above average levels which has been supportive to the market. Export sales this morning came in at 1,857,000 metric tons, this compares with the expected range from 1,000,000-1,600,000 metric tons. This mornings USDA report will be released at 11 am cst. The corn carryout is expected to come in between 2.222-2.352 billion bushels with the average estimate coming in at 2.313 billion bushels. Brazil corn production is expected to be pegged at 91.6mmt with the range coming in from 86.2-95.5mmt. Argentina production estimates range from 33-38.5mmt with the average estimate coming in at 36.5.
Technicals: Corn futures look to be consolidating a bit as market participants await some new news to cross the wires, that will come today in the form of a USDA report that is due out at 11 am cst. The bulls remain in control as prices levitate in the middle of support and resistance ahead of the report. Our first pocket of technical resistance continues to be from 391 ¾-392 ¾, a break and close above this pocket invites funds and momentum traders to extend their net long position. On the support side of things, 379-382 ¾ is the pocket that the bulls will need to defend, a close below will neutralize the chart.
Resistance: 391 ¾-392 ¾**, 400 ¾-406***
Support: 379-382 ¾****, 376-376 ½**, 370 ¼-372 ¼***
Yesterday’s Close: May soybean futures finished yesterday’s session down 11 ¼ cents, trading in a range of 14 ¼ cents on the day. Funds were estimated sellers of 8,000 contracts.
Fundamentals: Export sales this morning came in at 2,509,000 metric tons, this compares with the expected range from 1,000,000-1,700,000 metric tons. Market participants are looking forward to getting some new news today that will come in the form of a USDA report which is due out at 11am cst. Soybean carryout estimates are ranging from .490-.590 billion bushels with the average estimate coming in at .529 billion bushels. Brazil soybean production estimates are ranging from 112.0-116.0mmt with the average estimate coming in at 113.ommt; this compares to last month’s 112.0mmt. Estimates for Argentina’s production range from 45-53.5mmt with the average estimate coming in at 48.5; this compares to last month’s 54mmt.
Techncials: Yesterday’s session of profit taking from funds and hedging from producers has carried over into pressure in the overnight and early morning session. The market is testing the low end of support, but the bears will want to see confirmation through volume on the floor open. If the market closes below support, we would expect to see additional long liquidation baring any significant fundamental changes over the weekend. The next pocket of support doesn’t come in until 1039-1040. A close above keeps the bulls in control for the time being. We continue to believe there will be an excellent opportunity on the short side, but it is about risk management to and staying alive to have the ability to capitalize on that.
Resistance: 1070 ¼**, 1080-1082 ½****, 1091 ½**, 1119 ½-1123****
Support: 1056-1059***, 1039-1040****, 1013 ¾-1016**, 1001-1006***
Yesterday’s Close: May wheat futures finished yesterday’s session down 8 ¾ cents, trading in a range of 13 ¾ cents on the day. Funds were estimated sellers of 6,500 contracts.
Fundamentals: This mornings export sales came in at 391,000 metric tons, this compares with the expected range from 200,000-600,000 metric tons. The wheat carryout is expected to come in near 1.007 billion bushels with the range of estimates coming in from .970-1.035 billion bushels; last months came in at 1.009. Today’s USDA report will be mostly focused on corn and beans, but we could see spill over price action from those markets.
Technicals: The market is treading water at the bottom end of the recent range and hugging our technical support pocket which we have outlined as 493 ¼-499 ½. From a risk reward perspective, this is an excellent opportunity to look to the long side if you have a bullish bias. A break and close below opens the door to 478-481 ½, this pocket represents previous resistance which contains the 200-day moving average among other technicals.
Resistance: 516 ¾-518 ½***, 535-538 ¾**, 550***
Support: 493 ¼-499 ½**, 478-481 ½***, 451-453****
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