SPREADS
August crush trades to 85.22c/bu while oilshare firms to 32.99%. The July roll officially begins on Friday. On corn weakness this morning, July/Dec widens back out to 14 1/2c from 13 1/2c, while Jul/Sep trades out to 4 3/4c from 4 1/4c. July/Dec meal widens back out to $8.80 from $8.50. July/Nov beans firmed into 9c yesterday, and trades from 9 1/2c to 10 1/2c this morning.
PALM OIL
August crude closed up 59 ringgits higher, up 2% to a two-month high close Wed. on lower than expected May production and higher crude oil prices. SGS forecast their estimate of palm oil exports in May at 1.246 mln mt, up 4.4% from mo ago.
NEWS
The Dow is higher, up 175 pts, with crude oil advancing to new highs at $38.18/barrel before seeing a round of profit-taking. The US dollar falls to 97.28. The continued rise in the Brazilian Real vs. the weaker US dollar continues to make US beans more attractive, while shutting off farmer selling.
CALLS
Calls are as follows:
beans: 3-5 higher
meal: .70-.80 higher
soyoil: 10-14 higher
corn: 1 lower
wheat: 2 1/2-3 higher
canola: 2.20-2.50 higher
BUSINESS
USDA reports 186,000 mt of beans sold to China.
TECHNICALS
July Beans: Major direction is sideways/ higher, with first support moving up to $8.45 and upper resistance located at $8.62. Prices are setting new highs this morning, and the market has been well bid since Monday. Trade over $8.62 opens the door for a rally towards $8.70. Pullbacks may now be met with support and more buying interest given the solid tech performance as of late.
first support: $8.49/$8.51
resistance: $8.58/$8.62
possible range: much the same
July Meal: Prices are setting multiple lows from $281.00-$282.00, with converging lines of support on another break located at $280.00. The market is attempting to work higher, but will find more buy-stops triggered if prices can get over key resistance at $286.00. If short, would probably consider getting something priced in this vicinity, as a trade over $288.00 would trigger fund short-covering and a trade back towards $295.00.
first support: $282.50/$283.00
resistance: $285.50/$286.00
possible range: much the same or higher
July Soyoil: Prices remain well bid, matching previous market tops at 2814c. The major direction is higher, and prices have now matched previous market highs at 2814c. However, the rally does not appear to be quite finished at this point, and if prices can move over 2814c would target 2865c, the 100 day moving average, and then close a gap at 2890c. Prices have been well bid, and think the market is prepared to probably head towards 29c for a new 27c-29c trading range.
first support: 2780c
resistance: 2815c
possible range: much the same or higher
July Corn: The chart has key resistance today at $3.25/$3.28, and key support at trendline support at $3.18. If prices were to go to $3.18, would probably get something priced or cover in a partial short. Prices are attempting to walk back and test key support at $3.20 to see if can hold. For now, it is a pivot point in a market that is sideways from $3.10-$3.30, but gaining slight upward momentum.
first support: $3.20
resistance: $3.25
possible range: much the same or higher
July Wheat: Prices are sideways from $4.95-$5.25, with a test of trendline support located at $5.06. Prices bounced nicely off this level, and therefore think that pullbacks will be viewed as an opportunity to cover a short. Would look for a continuation of sideways trade from $5.05-$5.25, with any trade over $5.30 extremely constructive leading to a much larger rally.
first support: $5.05/$5.08
resistance: $5.15/$5.17
possible range: much the same
DECEMBER CORN
Prices are moving sideways from $3.30 to $3.45. The trend remains weak with an ADX reading on only 22. However, support at $3.30 seems stronger than current resistance, with $3.33/$3.35 serving as support today. This is perhaps one of the best markets to straddle/strangle, as prices have been caught in this sideways range since last April. A break-out to the upside would therefore come from a settlement over $3.43/$3.45, which would springboard prices to the next level of resistance located at $3.55. Without a major weather problem, expect rallies towards $3.40/$3.42 to still be viewed as a selling opportunity.
TAGS – Feed Grains, Soy & Oilseeds, Wheat, North America