ICE canola weekly outlook: Slowly grinding higher

Glacier FarmMedia — ICE canola futures saw some choppy activity during the week ended Nov. 26, falling below nearby support at one point before clawing back from those losses to continue their steady uptrend of the past two months.

Looking at the price action on the chart, canola is “grinding off its October lows,” said analyst Mike Jubinville noting that cash basis levels were also improving.

The January contract touched a session low of C$610 per tonne on Oct. 1 but has edged steadily higher since then — settling at C$651.70 per tonne on Nov. 26.

Jubinville said a sustained push above C$650 to C$660 would be supportive technically, with the next upside target at C$680. He added that the market was not overbought at current levels.

However, while canola is trending higher “the fundamental news could change at anytime,” said Jubinville.

He said weather threats in South America, movement on biodiesel legislation in the United States or any developments with Chinese trade could be the catalysts to spark a larger move one way or the other in the futures.

In the absence of any such news, he expected to see subdued sideways trade through the holiday period.