Friday’s Commitment of Traders showed funds holding net short position in Corn, Soybeans and Wheat

December corn futures marked new contract lows last week
November soybean futures ran out of supportive news to spark a technical breakout
Grain futures market update

Grain futures market update

Corn Futures (December)
 

Fundamentals: December corn futures marked new contract lows last week and finished near the low end of the week’s range. The technicals remain extremely weak, but bulls are hopeful that this week’s fundamental calendar will start turning the tide. Crop Progress will be out after the close, good/excellent ratings are expected to come in at 58%, steady with last week. Thursday’s USDA report is the big-ticket item, we will have estimates out in tomorrow’s report. Friday’s Commitment of Traders report showed funds holding a net short position of 119,371 contracts.

Technicals: The bears remain in total control of the chart and with prices in uncharted territory the water is a bit muddy. Looking at the continuous chart the next support pocket comes in from 338 ¾-343, still 10+ cents lower than the market. Sure the market is oversold and funds are net short, but neither are to extreme levels that would indicate things are “overdone”. Previous support at 363 ¾ now becomes resistance, the bulls need to see consecutive closes above here to increase the chances of a short covering rally.

Bias: Neutral/Bullish

Previous Session Bias: Neutral/Bullish

Resistance: 377-381**, 392 ¾***, 405-407**

Pivot: 363 ¾

Support: 338 ¾-343**

 

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Soybeans Futures (November)

Fundamentals: November soybean futures ran out of supportive news to spark a technical breakout, in the back half of last week’s trade. Friday’s Commitment of Traders report showed funds holding a net short position of 73,127 contracts. Today’s crop progress report is expected to show good/excellent ratings at 55%, steady with last week. All eyes will then shift towards Thursday’s USDA report, we will have estimates out in tomorrow’s report.

Technicals: The market failed against our resistance pocket last week, 880-882. The inability to stage a breakout led to pressure in the back half of last week’s trade. Prices have now retreated to our support pocket, 852 ½-856 ½. In our opinion, this is a MUST hold pocket. A break and conviction close below keeps the door open for a run at contract lows, 815 ½. From the risk/reward perspective, there may be a tradable opportunity here, but you’ll want to keep a tight leash on things.

Bias: Neutral/Bullish

Previous Session Bias: Neutral/Bullish

Resistance: 880-882**, 891 ½-896 ¾***, 921-924***

Support: 852 ½-856 ½****, 839 ¾-843 ¾**, 815 ½****

 

Wheat Futures (December)

Fundamentals: Chicago wheat futures have been under pressure for the last 2 ½ months, bulls are hopeful that the market can receive positive news from the USDA on Thursday and start to work on forming a base. The strength in the US Dollar has continued to be a headwind, hurting demand while supply remains relatively high. Friday’s Commitment of Traders report showed the funds have a net short position of 21,037 contracts.

Technicals: We probably sound like a broken record by this point, but the trend of lower highs and lower lows remains intact. So long as the bears can continue to defend 483 ½ they remain in control. The downside objective remains 442 ¼, contract lows. Despite being under constant pressure, the RSI and CoT are not as stretched as one would think, meaning that a technical “snap back” is probably not imminent.

Bias: Neutral/Bearish

Previous Session Bias: Neutral/Bearish

Resistance: 483 ½**, 493-500****, 525 ¾-531 ½****

Pivot: 460

Support: 442-446**, 427 ¼****

 

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