Grains Rebound and Poised to Test Higher Levels

Grain moved higher on Friday after a whipsaw trading week. Weekly corn export sales were down 13% from last week and 0.6% more than the prior 4-week average.  New crop sales of 273.4 TMT lifted combined sales to 1,127.7 TMT. Total sales were within analyst expectations that ranged from 80 to 1,350 TMT. Increases were reported for South Korea, Mexico, and Japan.

Corn Prices

Corn prices rebounded on Friday after hitting fresh 2-year highs on Thursday but closed lower following the cancelation of the North Korean summit. With the summit now back on, prices will likely move higher when they open following the Memorial Day holiday. Target resistance remains near the June 2016 highs at 4.39.  Support is seen near the 10-day moving average at 4.01.  Momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in the black with an upward sloping trajectory which points to higher prices.

Soybean Prices

Soybean prices moved up about 0.5% on Friday after whipsaw price action on Thursday. Resistance is seen near a downward sloping trend line at 1065. Support is seen near the 10-day moving average at 1019. Momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line).

Malaysian palm oil exports of 1,003,696 metric tons are 13.55% less than what was seen over the first 25 days of April and 0.3% below than the 1,160,994 MT shipped over the same period in May 2017. Malaysia resumed its export tariff on CPO beginning May 1st. The reinstated tariff is now at 5% and CPO exports are down 73% month over month.

Wheat Prices

Wheat prices surged higher on Friday rising 2.4%. Resistance is seen near the July highs at 553. Support is seen near the 10-day moving average at 511. Momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line).