The Ag sector drifted lower yesterday and light volume, reports Oliver Sloup.

Corn (ZCH)

Fundamentals: Corn futures subsided yesterday as the bullish headlines started to dissipate as we work our way into the low volume holiday trade. Yesterday’s weekly ethanol report showed production dropped 8,000 barrels per day to 1,064,000 barrels per day. Weekly export sales came in at 1,709,400 metric tons, a marketing year high.

Technicals: In yesterday’s report we moved our bias to neutral, as prices worked against our resistance pocket, $3.88 ½ to $3.90 ½. This pocket represents previously important price points.

Soybeans (ZSJ)

Fundamentals: November soybeans were lower for much of yesterday’s session but managed to rally into the close to finish near unchanged. The bullish headlines have seemingly run their course, which is part of the reason why we changed our near-term bias from neutral to bearish in yesterday’s report. Export sales this morning came in at 1,430,600 metric tons, up 36% from last week and 18% above the four-week average.

Technicals: The market held our four-star technical resistance pocket nearly perfectly over the last two sessions.

Chicago Wheat (CWH)

Fundamentals: Chicago wheat futures gave back some ground yesterday but are reclaiming some of that this morning, with help from a good export number. Export sales came in at 868,600 metric tons, a marketing year high and 95% better than the four-week average. This would explain the strength we saw at the beginning of the week.

Technicals: The market worked lower yesterday but managed to hold our pivot pocket from $5.44 to $5.46 ½, this was previously resistance and now becomes support. If we see the market breakdown below here, we would expect to see the selling accelerate.

Kansas City Wheat (March)

Technicals: Kansas City wheat futures tried to trade lower yesterday but found support near our pivot point (the 200-day moving average), $4.59 ½. The bulls will want to continue to defend this area, a close below could encourage some profit taking from recent buyers, taking us back to near term support.

Cotton (March)

Fundamentals: Export sales this morning came in at 249,400 RB, this was down 10% from the previous week but up 5% from the 4-week average.

Technicals: The chart is starting to resemble that of a bull flag, consolidating with lower highs and higher lows after a big leg higher last week.

Bill Baruch provides technical levels on all markets throughout the week at BlueLineFutures.comSign up for a complimentary two-week trial of 1 or all 4 of our daily Blue Line Express commodity reports!