SPREADS
May crush moves down to the lowest point so far at 81c/bu, while oilshare weakens to 33.55%. July/Dec corn remains a 2c-2 3/4c carry, while March/May firms into 3 1/2c from 4 1/2c. July/Nov beans trades into 10 3/4c from 11 1/2c. May wheat/corn trades at 157 3/4c. March/May wheat inverse trades from 1 1/2c to 2 1/2c.
PALM OIL
May palm ended 17 ringgits lower. Top economic officials from Indonesia said the gov. is considering increasing their palm oil export taxes in a bid to help support and expand domestic biodiesel production and consumption. Indian refiners of edible oils urged the gov. to stop issuing import licenses for palm-olein to help avoid a crash in domestic prices of rapeseed.
NEWS
The Dow is higher, up 60 pts but it would not be surprising to see prices trade both sides of unchanged as the impact of the virus continues. Crude trades back below $50/barrel which may impact soyoil futures at the start of the session.
CALLS
Calls are as follows:
beans: 1/2-1 higher
meal: steady
soyoil: mixed/easier
corn: mixed/easier
wheat: 1/2 to 1 lower
canola: .30-.60 higher
BUSINESS
USDA reports 123,000 mt of corn sold to South Korea for 2019/20.
TECHNICALS
May Beans: The tendency for this market is to post new lows followed by a better corrective bounce. The break to $8.79 1/4 was back below previous congestion at $8.83. Would look for the market to rally back towards the swing point of $8.96 minimally. Support moves up to $8.83 again, and if short would have to cover on any weakness towards $8.75 to $8.80 for a continued $8.80-$9.20 trading range.
first support: $8.83-$8.84 1/2
resistance: $8.94/$8.96
possible range: $8.83-$8.93 or higher
May Meal: Contract low is now $290.70, and the market is putting in a recovery trade off the low. Would look for prices to eventually trend higher still, with a $290.00-$302.00 trading range. If needing to price something, think that a break towards $291.00 would be a good place to do so.
first support: $292.50
resistance: $294.50
possible range: much the same or lower
May Soyoil: Prices reached a new low for the sell-off at 2939c, which took prices right to trendline support. Despite the weaker trade, if short would probably be lifting some of that position as long as we stay above the morning low. Would be more surprised to see a break of the morning lows, and it would be easy to retrace some of the recent break with a move back over 30c at some point.
key support: 2940c
resistance: 2980/30c
possible range: much the same
May Corn: Prices are now congesting inside the $3.73 1/2-$3.80 price level. Very strong crossing lines of support are now located from $3.71/$3.72 on a break, and a target low of $3.68 is in place should we go there. The major direction is lower, but prices could rally a bit as the overnight trade challenged the recent ctr lows of $3.73 1/2, which held in place so far. IF a pullback holds at the outset, would cover a partial short or try the long side of the market for a brief correction towards $3.80.
first support: $3.75
resistance: $3.78/$3.79
possible range: much the same or lower
May Wheat: Prices hit a major target low at $5.28 1/2 (the 200-day moving average) and bounced off. Typically, breaks to strong moving averages such as a 200 day often hold the first time around, but not the second. Double lows are in place today at $5.32 1/2 and feels like the market is going to test the 100-day moving average overhead at $5.41. IF short would probably be lifting something here, as price recovery back over $5.41 would create more buying, and a move back towards $5.50 for a $5.30-$5.65 trading range.
first support: $5.32
resistance: $5.41
possible range: much the same or lower
MAY WHEAT
Prices have adjusted lower with a test of the 200 -day moving average which was $5.28. Double lows today are $5.32 1/2, and if the market is to put in a further upward correction the market must hold them at the start of the trading session. Could own wheat from $5.28-$5.32, but would have to put in a tight sell-stop as any violation of $5.28 will flush out more length and take prices down to $5.18/$5.20. The chart presents a challenge to the bull as it has a top in place, and the previous strength of the downtrend has been depleted with an ADX reading of only 19. Think if the market is going to notch lower, it will do it at the start of the day.
TAGS – Feed Grains, Soy & Oilseeds, Wheat, North America
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