DTN Midday Grain Comments 07/24 10:57
Grain Futures Mixed at Midday
Grains trade is mixed at midday after initial strength; soybeans are higher.
By David Fiala
DTN Contributing Analyst
U.S. stock market indices are higher with the Dow up 10. Interest rate
products are lower. The dollar index is 4 higher. Energies are mixed with crude
oil down $.40. Livestock trade is lower with lean hogs trading limit down.
Precious metals are mixed with gold down $14.
Corn futures are flat to 2 cents lower at midday after reversing from early
strength. Trade is currently in the middle of a 12-cent range for day with a
new low made this morning at $3.64. Ethanol margins and basis remain stable
with good coverage for end users in place. The December 10-day is at $3.79 and
20-day is in the $3.98 area as upside targets on a bounce. Chart support will
continue to be round numbers under the recent low, such as $3.60 for December
corn. Forecasts have moisture for the Eastern Corn Belt, light for the Western
Corn Belt over the next 10 days with temperatures staying mostly below normal
which will limit stress. Trade remains oversold which could help support a
bounce here as shorts look to lock in profit. The weekly export sales were soft
on old crop and strong on new crop at 291,500 metric tons of old crop and 1.14
million of new crop.
Soybean futures are 8 to 14 cents higher at midday, well below the early day
highs. Meal is $4 to $5 higher and oil is 10 to 20 points higher. Weather
remains mostly non-threating for now but some areas will need an upturn in
moisture soon. Along with strong export demand, this is helping trade find some
additional buying support this week. On the November chart, support is the
contract low of $10.55 from Wednesday, with resistance at the 10-day moving
average at $10.82, which we have edged above Thursday. The 20-day moving
average at $11.15 is the next round of resistance. The crop is rapidly
approaching the key reproductive cycle and a dry forecast will likely continue
to find additional buying. The weekly export sales were strong with 226,700
metric tons of old crop, 2.45 million metric tons of new crop, 93,900 metric
tons of old crop meal, 348,900 of new crop meal, and 2,900 of bean oil.
Wheat futures are 1 to 4 cents lower at midday, giving back the dime higher
move seen earlier in the day as row-crop trade softened. Trade remains heavily
oversold which could encourage additional profit-taking if a bounce can be
sustained. Concerns over political issues in the Black Sea area have moved to
the back burner. On the chart, trade put in new lows which are support.
Resistance on the chart is $5.34 for Chicago wheat and $6.34 for KC where we
find the 10-day moving averages. The weekly export sales were mediocre at
443,200 metric tons.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered trading adviser.
David Fiala can be reached at firstname.lastname@example.org
Follow David Fiala on Twitter @davidfiala
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