September futures traded to a new low for the move of 3.46 ¾ probing under the June 19 th low. Resistance is at the winter lows of 3.70, the 50% retra

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1 Technical Overview Corn prices have continued to drop and are testing the lows on the nearby contracts from last winter near 3.35, completely retracing the winter/spring rally. The next support is the low from last August at 3.28 ½ while resistance is at the old downtrend near Momentum indicators on the weekly chart are oversold with the RSI at 30.34, but there isn t any confirmation of a low yet. The Commitment of Traders report showed managed funds were net sellers of 33,313 contracts of corn for the week ending June 26 th, increasing their net short position (bets for lower prices) to a net 90,764 contracts. They have flipped their position by over 270,000 contracts (1.35 billion bushels) during the past 4 weeks. Commercial hedgers (Producers/Merchants and End-users) were net buyers of 68,490 corn contracts for the week, lowering their net short hedge position to 327,077 contracts (1.635 billion corn bushels). Index funds were net sellers of 11,733 contracts for the week lowering their net long position to 287,496 corn contracts, while their share of the total open interest rose to 12.05% as of June 26 th, suggesting liquidation by other traders after options expired.

2 September futures traded to a new low for the move of 3.46 ¾ probing under the June 19 th low. Resistance is at the winter lows of 3.70, the 50% retracement at 3.83 ¾ (also near the March low) and the 61.8% retracement at 3.92 ½ (near the late April low). Support levels are a question mark with the July contract in deliveries. Momentum indicators are trending lower again with Stochastics near 32. Futures spreads are showing heavy carries still, with July- Sept hovering near 9 ½ cents for most of June, and the Sept-Dec spread now near.12 cents ($.04/bu/mo.). Basis levels have continued to narrow as plunging prices have stalled selling while end users are trying to extend coverage. Corn cash bids are flat, taking the incentive out of storing old crop corn. Producers should consider setting Basis levels if bullish during the next couple weeks as grain movement will likely pick up after spraying/pollination. Prices remain on the defensive as Canada, Mexico, the European Union and China implement retalitory Tariff in response to the U.S. Steel & Aluminum tariffs.

3 December corn futures stalled against the 4.29 ½ high from last summer placing a double top for resistance and have broken support near 3.80 (Winter lows) which is resistance now. The Crop Insurance average of 3.96 (during February) remains a psychological pivot ahead of pollination and is also close to the 50% retracement of the recent drop. 90% of the Insurance level is near 3.56 while 85% is near 3.37 (likely more significant especially in October). Stochastic Ocsilators are pointed lower, but remains above the values from the first half of June (divergence?). Crop conditions are favorable with forecasts looking mostly neutral but the large fund short position does have them vulnerable if forecasts become threatening or trade disputes get resolved. Many of the Tariffs have a July 6 th start date, (I m hoping the fireworks stay out of trade negotiations and don t blow up the broader markets).

4 The Weekly Continuous Soybean chart shows prices have fallen to probe the lows from 2015 & The nearby July contract has taken out it s lows from last summer and fallen all the way to 8.41 ½. Resistance is overhead at 9.00 and Next support is at 8.25, 8.00 (Psychological) then 7.76 (2008 low) if 8.40 gives way. A reflected channel line would be in the 8.40 neighborhood also. The Commitment of Traders report showed managed funds were sellers of 25,619 contracts, to raise their net short position to 52,656 contracts (bets for lower prices) as of June 26 th. Commercial hedgers were net buyers of 66,672 contracts for the week, to reduce their net short hedged position to 94,294 contracts (only 471 million bu. net hedged). Index funds were net sellers of 21,596 contracts of soybeans, lowering their long positions to a net of 140,708 contracts, about 13.8% of the total open interest. Similar to corn, the Index fund share of total open interest increased even though they were selling, indicating broader liquidation of positions as July options expired.

5 On the daily charts, August soybeans have a steep intermediate downtrend in place with resistance at Additional resistance is at retracements near 9.04, 9.38 (38.2%) and 9.66 (50%). The June 19 th low of 8.47 ½ is support. Momentum indicators are pointed lower again but are in oversold territory with Stochastics near 20. Soybean basis levels have strengthened during the last week as prices have fallen. Currently at -.65 August at our UP rail sites bassi is at the strongest levels for the current year, though still wide from historical averages. The bids have taken most of carry away from old crop cash soybeans removing the incentive to store. Board crush values continue to press to new highs with values near 1.90/bu. in the August and 1.80/bu. in September, very attractive for U.S. processors to maintain operating near capacity if they have soybeans on hand. NOPA and NASS crush reports have indicated processors have sustained strong crush paces though we just came through seasonal maintainence for several plants during April and May.

6 November soybeans have dropped sharply (nearly $2.00) since late May. The 10 day moving average has contained recoveries during June (currently 8.94). Additional resistance is near 9.25 and the 50% retracement of 9.62 ½. Support is at the June 19 th low of 8.64 ½. Similar to the August contract momentum indicators are oversold. Crop Insurance average was at in February and we are against the 85% value at 8.64 with the 80% value near 8.13 is a more significant objective (or cover point for offsetting against). Futures spreads for new crop soybeans are building carries between November and the later delivery periods (eliminating the inverses from a month ago) and trying to justify holding new crop soybeans where space is available (and allow for post harvest basis improvement). The Nov-Jan spread is now near 9 cents and Nov -Mar around 15 ½ cents.