Kleist Comments

MORNING GRAINS 5/16/14
MORNING GRAINS 5/16/14

Corn:
Exports: None Visible.
Comments: Could be a good day for a bounce or at least a consolidation?: farmer selling dries up; oversold after 22+ decline in two days (top to bottom); and open interest was off 9,000 led by July AND the December amid moderate volume (thought there were more new short sales whereas it was long liquidation); light snow in northern Illinois; July corn’s next downside target its 100-day at $4.76; likely bear defense a close over major m/a’s at $5.00-3/4-5.02-3/4 if selling rallies.
SOYBEANS:
Exports: Sold Unknown 180,000t new crop beans; Sold China 40,000t old crop soyoil.
Comments: Quick take on yesterday’s China new crop purchase and today’s Unknown: a Chicago farm broadcaster seemed confused between China cancelling then buying. China has not gone out of the bean import business yet and crushers, if offered a good price, will book some new crop beans because 1) look at the price differential and 2) they have plenty of time to cancel if need be. Deliveries: 1 and mini-beans 5; Malaysian palm oil (CPO) slightly higher on May 1-15 exports rising 22.5% on month but expected due to demand from Ramadan holiday end June; I feel personally gratified that I saw someone actually say yesterday’s old crop weekly export sales were mostly ‘switches’ from Unknown; open interest rose 4,100 even as July falls 11,100 (Q/U/X up) amid moderate volume. I noticed that July beans liked the May contract’s support in the $14.60’s, though unlike the May right now the squeeze game seems over with. Next test for the July their major m/a’s at $14.53-3/4-14.47-1/2, a close below there likely gets our near term downside objective. From a strictly technical perspective if bottom picking that also a solid bull defense, eh?

Wheat:
Exports: None Visible.
Comments: Like the corn, prices fell yesterday in part on long liquidation and not new fund selling and that might also cause a consolidation here as well. Open interest off 3600 led by July/Dec. amid moderate volume. Paris futures modestly higher over south Russian weather and some apparent new wrinkle in
the Ukraine situation. Nearby support a ‘double’ low at $6.76-1/2 (yest. and overnight) then that ‘double low’ in April at $6.63-3/4; likely selling at $6.96-1/4-6.99-1/2, likely bear defense a close over $7.10.

Kleist Comments

This is John Kleist, of Kleist Ag Consulting.
Questions? Email me: johnwkleist@sbcglobal.net

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