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Grains Consolidate, Following Monday’s Price Surge as China’s XI is Conciliatory

Grain prices consolidate Monday’s gains as conciliatory words on trade from China’s President Xi Jinping, who pledged greater openness in sectors from banking to auto manufacturers while warning against a return to a “Cold War mentality” helped to calm nerves and underpinned riskier assets while weighing on safe-haven assets.

Corn Prices

Corn prices tested generated an inside day on Tuesday in early North American Trade, which is a sign of indecision. Resistance is seen near the April highs at 392. Support is seen near the 10-day moving average at 385. Momentum is positive as the MACD (moving average convergence divergence) histogram is printing in the black with an upward slowing trajectory which points to higher prices.

Soybean Prices

Soybean export activity for the week was up 257% from the prior week but 7% less than the prior 4-week average. 2018/19 export sales were 358.2 TMT. Combined season sales were down 285% week over week. Total export commitments are 91% of projections with 22 weeks to go and need to average 214 TMT in weekly sales to meet forecast. Current export sales are 6.5% behind last year’s pace.

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Soybean prices remained buoyed and higher but is trading below Monday’s highs forming an inside day early in North American trade. Support is seen near the 10-day moving average at 1033. Resistance is seen near the April highs at 1060. 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).

Wheat Prices

Wheat prices consolidated and are lower after surging on Monday. Support is seen near former resistance near the February highs at 467. Target resistance is seen near the March highs at 553. 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).

This article was originally posted on FX Empire

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