Soybeans Lead Grains Heading into Thursday's Report

November 6, 2018 10:40AM CST

Soybeans have started this week lower after finishing last week’s trade strong with headlines of the US/China trade talks moving in the right direction. This week has not started well for the bulls with good weather forecasted in Brazil and comments from China’s president giving the tone that trade agreements aren’t as close as one would hope. Crush margins for January also traded to the lowest level for the year. The soybean market is hanging on the USDA report on Thursday as well as new headlines on the US/China trade talks. Decreases in yield from the USDA would potentially be offset by less demand from China due to an outbreak of African swine fever on their pork market. Look for the market to position itself in anticipation of Thursday’s report with January support at 873^6 and resistance coming in at last Friday’s high of 900^6.

December corn started the week on a positive note and is trading even to down a penny today. Estimates of a smaller USDA yield Thursday and a decrease in ending stocks are supportive. Corn harvest came in at 76% complete up from both last week and last year, although it will be interesting to see what affect the wetter than normal weather will have on yield. The market has potential for further advances but could be held back if soybeans are overly bearish. Resistance comes in at 377^4 and then 385^6 with support down around 362

Soybeans Jan '19 Daily Chart

Soybeans Jan '19 Daily Chart

 

Corn Dec '18 Daily Chart

Corn Dec '18 Daily Chart

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