ICE weekly outlook: Canola nears resistance

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Published: July 9, 2020

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ICE November 2020 canola with 20-, 50- and 200-day moving averages. (Barchart)

MarketsFarm — ICE Futures canola contracts hit their strongest levels in three months during the first week of July, but appear to be running into resistance from a chart standpoint.

The November contract hit an intersession high of $482 per tonne on Wednesday, but settled below the $480 mark.

“You can’t discount at least the potential of this time being the breakout time, but for right now it (resistance) continues to hold,” MarketsFarm Pro analyst Mike Jubinville said.

Gradual strength in outside vegetable oil markets, including European rapeseed futures and Chicago Board of Trade soyoil, were supportive influences, and Jubinville said it would take continued gains in those outside markets to keep canola pointed higher.

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Weather conditions in the United States and their influence on the CBOT soy complex will likely be a major driver over the next few weeks, with Canadian weather also being followed closely.

Excess precipitation may lead to issues with slow development and possible disease issues in parts of Western Canada. However, Jubinville said it was too early to cut yield estimates.

— Phil Franz-Warkentin reports for MarketsFarm from Winnipeg.

About the author

Phil Franz-Warkentin

Phil Franz-Warkentin

Editor - Daily News

Phil Franz-Warkentin grew up on an acreage in southern Manitoba and has reported on agriculture for over 20 years. Based in Winnipeg, his writing has appeared in publications across Canada and internationally. Phil is a trusted voice on the Prairie radio waves providing daily futures market updates. In his spare time, Phil enjoys playing music and making art.

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