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Posted June 4, 2025 at 11:26 am
Yesterday’s Settlement: 63.41, up +0.89 [+1.42%]
WTI Crude oil showed follow-through strength yesterday as geopolitical risk and Canadian wildfires aided in the short covering rally. Russia’s ability to export crude oil is being squeezed as sanctions continue to bite, and the probability of further sanctions from the Trump administration is growing as a ceasefire becomes less likely.
Today, WTI Crude Oil is lower by -0.34 [-0.54%] to 63.07
Crude is lower today on technical selling and the slowing of wildfires in Canada. The Canadian wildfires have shut in around 350k bpd for a short period, but overnight rainfall has slowed the fires and limited the risk of more barrels being taken offline.
Last night’s API report was as follows [thousand bbls]:
Crude: -3,300
Gasoline: +4,700
Distillates: +760
Estimates for today’s EIA report are as follows [thousand bbls]:
Crude: -3,128 estimate
Gasoline: -500 estimate
Distillates: +171 estimate
Refinery Utilization: +1.00%
Technical Analysis:
While crude showed follow-through strength, price failed to test our longer-term pivot pocket of….
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S&P, yesterday’s close: Settled at 5981.50, up 34.25 NQ, yesterday’s close: Settled at 21,706.00, up 171.50 E-mini S&P and E-mini NQ futures levitated from yesterday’s opening bell into the noon CT hour without a negative 30-minute bar. The tape largely held those gains aside from a wiggle after the private ADP jobs survey for May this morning. The survey came in at 37k versus 111k expected, with last month revised lower by 2k, and sets the stage for Friday’s official Nonfarm Payrolls report. Services data is also front and center this morning with final May SPGI due at 8:45 am CT and followed by the more closely watched ISM report at 9:00 am CT, which includes Prices. E-mini S&P futures stuck their nose above major three-star resistance at 5982.50-5987.50, trading to 5991.25 yesterday before settling at 5981.50. This pocket will remain crucial as a pivot and point of balance and trading above here will clearly pave the path for a test into rare major four-star resistance at 6019.50-6040.50. As for the E-mini NQ, it did clear the next wave of resistance at…
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Technicals
Wheat futures saw a choppy trade again in yesterday’s trade, probing out above the 50-day moving average but reversing to finish the day slightly lower. All in all, the market has seen wide ranges through the first half of the week, but prices remain near unchanged. Support and resistance levels remain intact. We continue to believe the risk/reward setup skews favorably to the Bull camp from these levels as the chart (despite not rallying significantly) continues to try and build a base of higher lows.
Technical Levels of Importance
Resistance: 541 1/4-544***, 569 1/4-571***
Pivot: 532 1/2-535
Support: 517 1/2-523 1/4***, 498-501 1/4***
Headlines
Drought bakes China’s wheat belt, slashing harvests for some
Parts of China’s wheat belt in Shaanxi and Henan provinces have been hit hard by hot, dry weather, with the sun baking the soil into cracked slabs and scorching the wheat before it could ripen. Last month, Shaanxi recorded its highest average temperatures since records began in 1961. While official figures are still some six weeks away, more than a dozen farmers in the area and those they hire to harvest the crop told Reuters of losses and small harvests, down as much as half for some.
In some parts of the province, the drought was so bad farmers brought the harvest forward by a week. And while rain finally arrived in recent days, bringing some relief, it has also threatened to disrupt the harvest for those who waited.
Seasonal Tendencies Update
(Updated on 6.2.25)
Below is a look at historical price averages for July wheat futures on a 5, 10, 15, 20, and 30 year time frames (Past performance is not necessarily indicative of future results).
Commitment of Traders Update
Friday’s Commitment of Traders report showed Funds were net buyers of roughly 8k futures/options. The second straight week of net buying from Funds.
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Originally Posted on June 3, 2025
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