RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

Soybeans were the leader to the downside overnight following yesterday afternoon’s larger than expected improvement in crop conditions and weather forecasts continuing to indicate occasional rains and very moderate temperatures across the corn belt over the next two weeks. Corn was able to eke out a small loss despite the somewhat unexpected small decline in conditions last week, but the non-threatening weather appears to have trumped that factor in overnight trade.

U.S. soybean conditions improved by 2% in good/excellent last week to 59% and compares to last year’s crop at this time of 72% of g/e. Market ideas were unchanged conditions. Solid improvements were fairly widespread, led by IL and MS up 7 & g/e, IN up 4%, SD and KY up 3%, MO, WI, and LA up 2% and NE, MN, OH, ER, and MI up 1%. Overall conditions remain the second worst of the last 11 years, only better than the horrendous conditions in 2012.

Because of Friday’s continuation of the past five weeks’ uptrend, the hourly chart below shows that the market has identified Friday morning’s 34.08 low as the latest smaller-degree corrective low it now needs to sustain gains above to avoid confirming a bearish divergence in momentum and stemming the rally. Per such 34.08 is considered our new short-term risk parameter to a still-advised bullish policy. Former 34.37-area resistance would be expected to hold as a new support if the market is still truly strong up here. 


Dec ’17 Soybean Oil 60 min Chart

Dec '17 Soybean Oil 60 min Chart

Manon Lasserre