7/27/18

Morning Bullet Points - 07/27/2018

HAPPY FRIDAY—

 

MARKET HIGHLIGHTS

  • Markets trading mixed overnight following the sell-off from highs yesterday.
  • August options expire today.
  • CFTC commitment of traders will be out this afternoon with funds expected to show up as sizable buyers in corn, beans, and wheat.
  • The spring wheat tour found an average yield of 41.1 bpa vs. 38.1 last year and five-year average of 40.5.
  • Corn technically is trending higher with support for Dec. at 3.64 and resistance near 3.85.
  • Soybeans technically are starting to trend higher with support at 8.80 and resistance well above the market at 9.30.
  • Wheat technically traded up to resistance near the highs of the year yesterday before pulling back.  Support for Sep. Chicago at 5.15 and resistance 5.55.
  • USDA reported 270,000 MT of corn to unknown for 2018/19.
  • USDA reported 154,100 MT of soybeans to unknown for 2018/19.

 

WEATHER

  • Cool temperatures set in over the next five days before returning to normal in the 6-15 period.
  • Scattered rains expected over the next couple weeks as well to limit weather concerns in the US.
  • Russia dries out to allow wheat harvest to pick back up.

 

OUTLOOK

  • Corn ran out of gas yesterday at resistance near 3.80 December.  A low looks like it may be in place, but some consolidation between moving average support at 3.65 and resistance near 3.85 is possible.  Longer term, the global supply situation continues to be supportive with higher prices likely.
  • Soybeans also reversed hard after hitting resistance yesterday.  Similar to corn, a low looks to be in place, but if corn takes a break to consolidate in this price area, beans will probably trade similarly.  Longer term, soybeans do not have as good of an outlook as corn, so from a producer’s standpoint, I think it is important to take advantage of selling opportunities when they are presented.  9.30 looks like a valid target for the Nov. contract.
  • Wheat made a run at the highs for the year again yesterday, but failed to take out the highs again.  With that being the fifth time we’ve traded there, it seems likely that we eventually take out that resistance and head higher.  Look for pullbacks to be supported.

 

Fun Fact of the Day:  A Boeing 787 has over 2.3 million parts, and workers on the 747 have to drill a million holes during its assembly.

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