By Dwayne Klassen, Commodity News Service Canada
May 7, 2013
Winnipeg – Canola futures on the ICE Canada trading platform finished mainly on the defensive Tuesday with bearish chart signals and the triggering of sell-stops behind some of the price weakness, market watchers said.
Early losses in canola were fueled by the inability of technical support levels to hold, particularly in the July canola contract, brokers said. The push below support triggered sell-stop orders which amplified the price declines experienced by canola for a portion of the session.
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The absence of willing buyers allowed the sell-off to occur, traders said. The general firmness of the Canadian dollar was also viewed as an undermining price influence.
However, at the lows of the day some commercial demand finally came forward and helped canola move off its lows. The strength displayed by CBOT soybean and soyoil futures also was viewed as an underpinning price feature, traders said.
Weather outlooks calling for wet and cool conditions to return to the Canadian prairies also restricted the downward price slide, brokers said. Those conditions could further delay the planting of the crops in western Canada.
The buying back of previously sold positions also slowed the price declines in canola.
There were an estimated 16,885 canola contracts traded Tuesday up from the 8,165 contracts that changed hands during the previous session. Of the contracts traded, 3,462 were spread related.
No milling wheat, durum or barley contracts were traded during the session.
Prices are in Canadian dollars per metric ton.
