SPREADS
Wheat inverses remain strong nearby, with May/July reaching 24c over on Friday, now trading from 13 1/2c high to 10 3/4c. July crush trades firmer to 1.18c/bu while oilshare is firmer at 29.79%. July/Dec corn narrows into 12c from 12 1/2c. July/Nov bean inverse trades from 13 1/2c down to 9 1/2c. July/Dec meal inverse trades from $12.10 to $10.90. May wheat/corn trades from 2.29 1/4c to 2.30c.
PALM OIL
June down 39 ringgits, down 1.6% as demand concerns outweigh supply disruptions due to coronavirus.
NEWS
Stocks are down 99 pts in quiet trade, with the US dollar firmer to 99.95. Crude trades to $21.89/barrel, off its all-time low of $19.85/barrel.
CALLS
Calls today are as follows:
beans: 3-5 lower
meal: 1.20-1.50 lower
soyoil: 10-14 lower
corn: 1/2-1 lower
wheat: 2-2 1/2 lower
canola: 3.40-4.00 higher
BUSINESS
USDA reports 113,000 mt of corn sold to Japan for 2019/20
TECHNICALS
July Wheat: Prices are retreating in a congestion phase from $5.51 to $5.71 in what appears to be a bull-flag period of consolidation. Multiple bottoms are located at $5.50-$5.52, which is still support at the open. On a further decline, would expect it to hold. Resistance is also lowered as prices retreat, with $5.65 now becoming a level that the market has to take out if long. Since the chart presents a bit on the bullish side, would not want to be a seller until $5.45-$5.51 is violated.
key support: $5.51
resistance: $5.63/$5.65
possible range: much the same but depends on the report
May Corn: Prices move into key support at $3.40, and seem to be stuck here, with a current ctr low of $3.32. The down-trend is getting stronger with an ADX reading at 30, meaning funds will continue to sell rallies. For now, the key to lower prices would be to open and break $3.38, double lows, which may get tested at the open. Target low under $3.32 is $3.25. If the report is more bullish than expected and prices take out $3.50, will trigger buy-stops and an expanded upside range. Current trading range is from $3.32 - $3.50/$3.52.
key support: $3.38 to $3.40
resistance: $3.44 1/2-$3.45
possible range: depends on the report
May Beans: Mini-trading range is from $8.70-$8.98, but broader range is from $8.40-$8.80. Returning to lows and failing on rallies is never a sign of inherent strength, but the bean market has little follow-through in either direction, and would expect it to stay that way into the report. Any trade outside of $8.70-$8.95 would be a break-out. While beans have shown the ability to bounce, would also note that recent rally highs have been a touch lower, which actually reinforces resistance.
key support: $8.68-$8.71
resistance: $8.88/$8.89
possible range: depends on the report
May Soyoil: Prices trading in an uptrend channel with key support today at 2660c, and under that 26c. Bottom of the uptrend channel is located at 2650c, and top of the channel is well overhead at 2740c. On a weaker start, would look for prices to perhaps drift towards 2650c, but would probably cover a short at that level, and keep the rest in case it's broken for a trip down to 26c.
first support: 2650c
resistance: 27c
possible range: depends on the report
May Meal: Overall trading range is from $313.00 up to $336.00. The chart is not toppy, with a wide range still present in an uptrend channel. Prices would have to cross back under $313.00 to turn the trend lower now. Until then, would continue to price or cover a short on breaks towards $320.00.
first support: $320.00
resistance: $325.00
possible range; depends on the report
JULY WHEAT
Prices are retreating from current market highs of $5.71, approaching overall lows of $5.51. The chart pullback from $5.50-$5.71 speaks to wheat could be a bull -flag formation, which is overall bullish and implies that prices could head higher again. Would therefore not sell this market until it breaks $5.45, in which case prices still have plenty of support in the form of crossing moving averages located at $5.43 and $5.30. If prices can confirm a top, with a violation of $5.45, would look for a pullback to $5.30 as a possible buying opportunity. Big picture trading range is from $5.30 $5.71, with a relatively firm up-trend intact.
TAGS – Feed Grains, Soy & Oilseeds, Wheat, North America
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