Soybeans and Wheat rebounded sharply on bullish crop planting reports.
We were able to capitalize on the Soybean move to reap a 2.1% daily return.
Post-Market Wrap-up for May 14, 2019
Pre-Market Set-up for May 14, 2019
With recent strength in the Treasury Bond Market, we are looking for an entry point above 150.
We believe the recent sell-off in Soybeans has been overdone and are looking for a bounce upward.
We are looking for a Long entry point above 818.75.
Gold has been showing strength recently and although we recently took profits on a trade, we will be interested in re-entering this market if strength persists above 1315.00.
Post-Market Wrap-up – May 13, 2019
It was a turbulent day in the markets, as the Chinese announced their retaliatory responses to the tariffs imposed by the US on Friday. Below are our trades for the day.
A nice recovery in the price of wheat allowed us to get in for a day trade. We were able to enter and exit for a 10% daily return.
With the large overnight plunge in the S&P and the continued pressure to the downside, we had a Sell signal hit and were able to enter the market for a Short which netted a 3.4% daily return.
Pre-Market Set-up for Monday May 13, 2019
We are watching the following markets on this trading day:
Having fallen over 2% this past week amid concerns over trade negotiations between the US & China, I believe this market will enter into a consolidation pattern this week. If I am correct and the market moves sideways, we will remain on the sidelines. If, however, the S&P shows strength and trades above 2930 (above the current area of congestion) or continues to breakdown and trades below 2826 (breaking the current levels of support), we will be looking to enter the market for a trade.
Soybeans – July 2019 Contract
Amid trade talk concerns, Soybeans fell 3.92% over the past week. Based on market fundamentals, this sell-off has been over-done and I am looking for a retracement of these looses to fill-in the gap left at 336 – 340. I will be looking to enter this market on the Long side if it recovers above 806.00.
Similar to Soybeans, Wheat has been a casualty of the current US-China trade talks. I am looking for a recovery above 438.00 to enter this market on the Long side.
Amid growing world tensions and strong demand, Crude is trending upward. I am looking for a push above 63.00 where we will be looking to go Long.
Soybeans Await News On Trade Deal
Wheat Surges Higher
Our Shubie Partners AG Growth Fund saw a nice run in Wheat today.
As shown on the hourly Wheat (May 2019) chart above, Wheat surged 28.50 cents or 6.65%. As the Ag markets await news on a China trade deal, the only apparent reason for this move was a lack of bad news. Additionally, no doubt there was some fund short covering here as well, as the Wheat market has fallen a full cent over just the past month due to pressure from short selling.
Crude Oil Shows Strength
Coming off of last week’s two day OPEC + Russia meeting where the decision was to pull 1.2 million barrels of oil daily from the markets, Light Sweet Crude has begun to show strength. The proof of this agreement will however ‘be in the pudding’, as we wait to see if each of the parties involved, uphold their end of the agreement.
Over the past couple of weeks, Crude has tested the $50 level but failed to close below it. Therefore from a trading standpoint we are looking for a breakdown below $50 or a meaningful push above the $55 level.
We are Watching Gold for a Trade
Since hitting $1230 on October 11th, Gold has shown support @ the $1220 level. We attribute this move to instability in the equity markets as well as recent political events which have sparked a flight to security. We will continue to monitor this market for a trade to the Upside.
Ags Turn Negative Amid Poor Exports and Record Supply
Amid Poor export numbers and surplus stocks; Corn, Soybeans and Wheat have begun to consolidate with a downward bias. In December Wheat, (pictured above), support and resistance are 505 and 527 respectively. Unless we see positive export news, we expect to see Corn, Soybeans and Wheat to trend lower.
S&P Remains Weak
Given the magnitude of last week’s decline and the lack of follow-through in the recovery on Friday, there is potential for further market decline. With this in-mind we will be watching downward momentum early in the trading session, to gauge the potential for further profitable trades from this market correction.