Grain markets were uniformly weaker to start the week but are mixed this morning with corn higher, beans, lower, and wheat near unchanged. What’s in store for today’s trade?
Oliver Sloup was on RFD-TV yesterday morning, sharing his thoughts on the markets negative reaction to an otherwise friendly USDA report last week.
Soybeans
Monday’s Recap
Jan Soybean futures settled at 1022’2 Monday, down by 8’0, in lower trade across the board. Overall the session saw 262,071 contracts change hands, with Jan volume coming in at 137,395. Total open interest decreased 2,636, or 0.31%, with Jan dropping by 7,860 (2.28%) to 337,143.
Technicals
The soybean market failed against Friday’s high to start the week which further emphasized our interpretation of Friday’s price action as a fundamental rejection. Meaning the market had a good reason to stage a more impressive rally and couldn’t do it, that is a big caution flag. Yesterday’s rejection and weakness has led to additional pressure this morning. First support comes in from 1006-1008 3/4 with arguably the more significant pocket coming in from 995 3/4-1002 1/2. From a risk/reward perspective, these lower pockets may offer a setup to the buyside, whether that be covering shorts or dipping the toes in long.
Technical Levels of Importance
Resistance: 1049-1052 1/2***, 1083 3/4-1087 1/2****
Pivot: 1018-1024 3/4
Support: 1006-1008 3/4***, 995 3/4-1002 1/2***
Popular Options
Option trading centered around the Jan 1000 calls with 6,607 traded and the Dec 1000 puts with volume of 10,700. Options with the greatest open interest are the March 1100 call with 15,297, and the Jan 940 put with 21,273.
Volatility Update
Implied Volatility finished the session slightly up with SVL higher by 0.03, to end the day at 19.14. Historical volatility (30-day) closed the session at 13.66%, gaining 0.15%. The SVL Skew ended the session slightly down, losing 0.2 to settle at -0.47.
Seasonal Tendencies Update
Below is a look at historical price averages for January soybean futures on a 5, 10, 15, 20, and 30 year time frames (Past performance is not necessarily indicative of future results).
Commitment of Traders Update
Friday’s Commitment of Traders report showed Funds were net buyers of roughly 4.5k contracts, which puts them net short 56.4k contracts.
Ready to dig in?
Subscribe to our daily Grain Express for fresh insights into Soybeans, Wheat, and Corn. Get our expert technical analysis, proprietary trading levels, and actionable market bias delivered right to your inbox.
Sign Up for Free Futures Market Research – Blue Line Futures