USDA Day!
Oliver Sloup of Blue Line Futures - InsideFutures.com - Thu Jul 12, 8:04AM CDT

CORN (December)

Yesterdays Close: December corn futures finished yesterdays session down 6 cents, trading in a range of 7 cents. Funds were estimated sellers of 21,500 contracts.

Fundamentals:The USDA will release their monthly report at 11am cst today, below are estimates. In the weekly EIA inventory report, ethanol production fell 34,000 barrels per day to the lowest level in 2 months. Export sales came in at 530,100 metric tons, this was below the low end of the expected range.

Yield: 174.9 bushels per acre

Production: 14.269 billion bushels

Carryout: 1.725 billion bushels

Technicals: The market finished lower for the third consecutive session, posting new contract lows and closing near the bottom end of the days range. The market has been steady to slightly firmer in the overnight and early morning session as market participants await new news which could give us a bigger technical move. We are in uncharted territory so technicals carry less weight than normal. 350 is obviously a psychologically significant level traders will want to keep an eye on. On the resistance side of things, the bulls want to achieve a close back above 358 -360. Consecutive closes above this pocket could spur short covering towards our significant resistance pocket from 376 -379 .

Bias:(sign up for a free trial to view the full report)

Resistance:(sign up for a free trial to view the full report)

Support:(sign up for a free trial to view the full report)

SOYBEANS (November)

Yesterdays Close: Soybean futures finished yesterdays session down 24 cents, trading in a range of 19 cents (gap). Funds were estimated sellers of 13,500 contracts.

Fundamentals:The USDA will release their monthly report at 11am cst today, below are estimates. Headline risk continues to be a big factor in keeping prices suppressed despite being in oversold conditions for so long. We still believe that soybean demand will remain firm as global demand continues to shift. Brazilian beans have been on a tear making it more advantageous for previous buyers like the EU to look to the US for more competitive pricing. Export sales this morning came in at 429,400 metric tons, this was just below the low end of the expected range.

Yield: 48.6 bushels per acre

Production: 4.314 billion bushels

Carryout: 471 million bushels

Technicals: Trying to find technical support in a market making new contract lows has proved to be a fools errand since the beginning of time, soybeans are proving that once again. For some reason, retail traders feel compelled to be some sort of hero and pick a bottom. We believe that the bottom is more of a process than a point, making buying on strength a more realistic option for us. The bulls need to regain ground back above 866 -872 to have a chance at encouraging additional short covering. Our bias remains neutral as it would be ill advised to recommend selling here, sometimes the best trade is no trade.

Bias:(sign up for a free trial to view the full report)

Resistance:(sign up for a free trial to view the full report)

Support:(sign up for a free trial to view the full report)

WHEAT (September)

Yesterdays Close:September wheat futures finished yesterdays session down 18 cents, trading in a range of 19 cents. Funds were estimated sellers of 10,000 contracts.

Fundamentals: The USDA will release their monthly report at 11am cst today, below are estimates. Export sales this morning came in at 136,400 metric tons, this was below the low end of the expected range. The lack of bullish news and heavy pressure in other grain markets has snowballed into pressure on wheat. The market has been dead weight this week with winter wheat harvest in the homestretch and better yields than some had previously thought.

All wheat carryout: 973 million bushels

Technicals: The wheat market has provided a lot more opportunities to trade as it remains in the years range, making technicals more meaningful. We have been bearish on the failure to breakout above 4-star resistance, and the target of 475 -480 was achieved. If you were short this is a place to reduce or lighten up. We will not recommend flipping long, we would rather sit tight and sell rallies. If the bears keep the peddle to the medal, we could see a retest of the December lows at 450 .

Bias:(sign up for a free trial to view the full report)

Resistance:(sign up for a free trial to view the full report)

Support:(sign up for a free trial to view the full report)

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