Last week’s crop report had the bean market crushing corn, reports Oliver Sloup.

Corn (ZCZ)

Friday’s Close: December corn futures finished Friday’s session down 18.5¢, trading in a range of 42¢.

Fundamentals: Corn futures got slammed Friday afternoon, following a bearish USDA report. Their planted acres survey showed corn acres at 91.7 million acres, well above the average estimate of 86.8 and just about 1 million off of the March report, 92.8 million acres. We know the survey was taken from the beginning of the month and may not be reflective of up to date intentions, this report sets a high bar going forward, there will likely be another survey update in August. Crop Progress will be released at 3 pm cst, condition expectations are around 58% good/excellent, up 2% from the previous week. Friday’s Commitment of Traders report showed funds holding a net long position of 187,929 contracts.

Technicals: December corn futures broke below support from $4.47 ¼-$4.49 and that opened the door for a straight shot to our next support level, $4.31 ¼. Significant support this week comes in from $4.17 ¾-$4.20, a break and close below here could trigger additional long liquidation. Though Friday’s report was undoubtably bearish and did significant damage to the chart, the bulls still have the advantage on the intermediate term chart.

Bias: Bullish/Neutral

Resistance: 447 ¼-449***, 462 ½-464 ¼**, 473-475***

Pivot: 431 ¼

Support: 417 ¾-420***, 399-406****

Soybeans (ZSX)

Friday’s Close: November soybeans finished Friday’s session up 11.25¢, trading in a range of 18.75¢.

Fundamentals: Soybean futures managed to find some strength on the back of Friday’s acreage report. The USDA pegged soybean acres at 80.00 million, this vs. the average analyst-estimate of 84.4. The dramatic drop in soybean acres makes the corn number seem a little more reasonable, though still questionable in our opinion. Crop Progress will be out at 3 pm cst today, the average estimate is for soybeans to have a rating of 55% good/excellent, up 1% from last week. Trade negotiations with China are expected to continue following a good meeting between leaders at the G20 summit in Japan. Friday’s Commitment of Traders report showed the funds holding a net short position of 34,042 contracts.

Technicals: The market held trendline support on Thursday and with the help of a friendly USDA report on Friday, the market worked higher. Higher lows are marked so far, leaving the door open for potential higher highs. First resistance today comes in from $9.34 ¼ to $9.38 ¾, just above here is recent highs at $9.48. On the support side of things, the market needs to defend Friday’s gains and feed off of that momentum. A failure to do so would neutralize our bias.

Bias: Bullish

Resistance: 934 ¼-938 ¾***, 948-950**, 969 ¼-971***

Pivot: 922 ¾-923 ¾

Support: 907 ¾-913 ¼***, 891 ¾**

Wheat (ZWU)

Friday’s Close: September wheat futures finished yesterday’s session down 20.25¢, trading in a range of 32.25¢.

Fundamentals: The market plunged lower on Friday on the back of pressure from the corn market. As mentioned in previous reports, if weakness set in on corn, wheat would likely experience the brunt of the pressure. Friday’s USDA report had all wheat acres at 45.609 million acres, in line with the average estimate of 45.654 million acres. Ending stocks came in at 1.072 billion bushels, in line with estimates of 1.100 billion bushels. Friday’s Commitment of Traders report showed funds holding a net long position of 31,513 contracts. Crop Progress will be released after the close today, expectations are for crop conditions to increase by 1-2%.

Technicals: The market is right back down to support from 1 ½ weeks ago and the 200-day moving average. A break and close below here opens the door for another 20¢ lower. Another break lower could also cement a double top in the market. First support today comes in from $5.14 ¼-$5.18 ¾. On the resistance side of things, the bulls need to reclaim ground above 535-536 ¼.

Bias: Bearish/Neutral

Resistance: 535-536 ¼**, 562 ¾**, 571 ¾-578 ¾***

Pivot: 525 ¾

Support: 514 ¼-518 ¾****, 498 ¾-502***, 486 ¾-490 ¾****

Bill Baruch provides technical levels on all markets throughout the week at BlueLineFutures.com.

You can sign up to receive these levels here.