Grain markets got hit hard in Thursday’s trade. Will support levels hold or is more selling pressure to be expected?

Soybeans

Thursday’s Recap
May Soybean futures closed the session at a one month low of 1037’2 Thursday, off by 4’0. Across all maturities, 288,998 contracts changed hands, with 153,275 traded in the May maturity. Combined open interest decreased 20,024 (2.49%), with May up by 1,096, or 0.29%, to 374,598.

Technicals
Soybean futures were lower yesterday, but it wasn’t a hardcore selloff like we saw in many other acres. Corn is doing the heavy lifting in terms of brining that corn/bean ratio back into normal territory. Significant support remains intact from 1037 1/4-1038 1/2. A failure here and we could start to see the selling accelerate. We still see some attractiveness in the November contract. For a longer-term play, we like looking at options to help offer staying power during what has been a choppy trade as of late.

Technical Levels of Importance
Resistance: 1063-1066 3/4***, 1088-1092 1/2***
Pivot: 1055-1057 1/4
Support: 1037 1/4- 1038 1/2****, 1028 3/4-1031 1/4***

Popular Options
The Feb ZS4 1040 put saw the most traded with 3,138 contracts changing hands. Calls with the largest open interest are the May 1080 strike (10,287), and for the puts are the May 1000 strike (16,876).

Volatility Update
As measured by SVL, implied volatility finished the day slightly down, off 0.027 to settle at 15.52. Dropping 0.0123%, historical volatility (as measured by the 30-day) closed the day at 20.42%. The SVL Skew was down with the 30-day dropping 0.058, finishing at a one month low of 0.45.