DTN Midday Grain Comments 07/31 11:29
Grains Mixed at Midday
Mixed action is seen at midday with limited changes in the forecasts.
By David Fiala
DTN Contributing Analyst
The U.S. stock markets are mixed. The interest rate products are higher. The
dollar index is 65 points lower. Energies are lower with crude oil down $0.90.
Livestock trade is mostly lower. Precious metals are higher with gold up $6.
Corn trade is a penny lower at midday; the trading range has only been a
nickel and we are near the lows. The market dropped last week into early this
week erasing most of the big late June into early July gains. Now the market is
looking for a trading range heading toward the August USDA supply and demand
numbers due out on Wednesday, Aug. 12. This is a summer weekend so the noon
forecasts should have the most control of our direction into the close. Chart
direction remains down, but the momentum has stalled. If Fridays are trend
days, we should end up slipping. Crude is down 80 cents and looking like it may
want to go challenge its lows, but the dollar is lower so outside markets are
mixed at midday. On the December chart corn resistance is in the $3.97 area
where we find the 10-, 50-, and 100-day moving averages. Support is at the
$3.75 3/4 low printed yesterday then the $3.62 1/2 contract low.
Soybean trade is 6 to 8 cents lower at midday, meal is off $3 to $4 and bean
oil is down 30 points. Good weather and forecasts have the market believing
crop ratings can come up on Monday, plus the overall chart momentum remains
down with the bounce stalling at nearby resistance yesterday. Tighter old crop
supplies and good usage are supporting August. August was only a dime above
November two weeks ago and now sits 40 cents above it. Weather remains
non-threatening for established beans as we work into the main reproductive
window this week. Unless weather changes sellers are expected to be around on
rallies, and the midday action acts like this will be a trend day, so watch for
long liquidation this afternoon. Good weather can add soybean yield well into
September so forecasts should continue to be the most important market
directional indicator looking to next week. On the November chart support is
the contract lows at $8.95. Resistance is the 100-day moving average at $9.55.
Wheat trade is flat to 3 cents higher across the three contracts at midday.
Some light short profit taking is noted for the stop in the market slide along
with the good weekly sales number yesterday. Market bulls hope the lower prices
will continue to support exports. The weak dollar today is limiting selling in
wheat, but bears continue to be in control due to the comfortable world
supplies. Spring wheat yields have been good which has been illustrated in our
futures direction this month. On the September Kansas City wheat chart support
is the fresh low at 4.90 with the 10-day moving average resistance at $5.11.
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered trading adviser.
David Fiala can be reached at email@example.com
Follow David Fiala on Twitter @davidfiala
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