Is an Inverse Head and Shoulders Pattern Forming?
Fundamental Snapshot
Crop Progress
Yesterday’s weekly crop progress report showed further declining crop conditions. Good/Excellent conditions for soybeans were down 1%, to 59%, which was in line with expectations. However, corn G/E ratings fell 3%, to 58%, 2% lower than expectations.
Private Estimates
DTN released their yield estimates for corn and soybeans yesterday afternoon, and boy were they bullish. They have the national average corn yield at 167.2 bushels per acre, well below the USADA’s July estimate of 177. We have been assuming the market has been trading 174-175. DTN’s estimate for soybean yield comes in at 48.9, well below the USDA’s 51.5. As with corn, we’ve been assuming the market is trading closer to 50bpa.
WASDE Estimates
Reuters has complied estimates for Friday’s WASDE report. The average analyst estimate for corn yield is 175.9, with production at 14.392. The average estimate for soybean yield is 51.1, with production at 4.481.
Corn (September): September corn futures got some friendly news yesterday afternoon which helped propel prices back to technical resistance. The last few times we have been up at this level we moved our bias back into bearish territory, but with a potential inverse head and shoulders pattern forming and a WASDE report looming, we are keeping our bias Neutral. A breakout and close above 628-632 could open the door for an extension towards 650.
Bias: Neutral
Previous Session Bias: Neutral
Resistance: 628-632***, 645-652 ½***
Pivot: 600
Support: 580 ¾-586 ¼****, 561 ¼**, 542 ¼-547 ¾***
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.
Crop Progress
Yesterday’s weekly crop progress report showed further declining crop conditions. Good/Excellent conditions for soybeans were down 1%, to 59%, which was in line with expectations. However, corn G/E ratings fell 3%, to 58%, 2% lower than expectations.
Private Estimates
DTN released their yield estimates for corn and soybeans yesterday afternoon, and boy were they bullish. They have the national average corn yield at 167.2 bushels per acre, well below the USADA’s July estimate of 177. We have been assuming the market has been trading 174-175. DTN’s estimate for soybean yield comes in at 48.9, well below the USDA’s 51.5. As with corn, we’ve been assuming the market is trading closer to 50bpa.
WASDE Estimates
Reuters has complied estimates for Friday’s WASDE report. The average analyst estimate for corn yield is 175.9, with production at 14.392. The average estimate for soybean yield is 51.1, with production at 4.481.
Corn (September): September corn futures got some friendly news yesterday afternoon which helped propel prices back to technical resistance. The last few times we have been up at this level we moved our bias back into bearish territory, but with a potential inverse head and shoulders pattern forming and a WASDE report looming, we are keeping our bias Neutral. A breakout and close above 628-632 could open the door for an extension towards 650.
Bias: Neutral
Previous Session Bias: Neutral
Resistance: 628-632***, 645-652 ½***
Pivot: 600
Support: 580 ¾-586 ¼****, 561 ¼**, 542 ¼-547 ¾***
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.