DTN Midday Grain Comments 08/27 11:15
All Grains Higher at Midday
Soybeans lead corn higher at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock markets are higher with the Dow futures up 259 points. The
interest rate products are mostly higher. The dollar index is 70 points higher.
Energies are higher with crude up $2.60 cents. Livestock trade is mostly
higher. Precious metals are higher with gold up $1.
Corn trade is 2 to 3 cents higher at midday with trade continuing to grind
around in the recent range. Outside markets are mixed this morning with crude
and stock futures sharply higher, and the dollar and metals slightly higher. No
major weather issues are out there at this juncture with more corn being
shelled in some of the southern growing areas. Crude futures have bounced back
over $41 at midday boosting ethanol blender margins, with ethanol futures
moving slightly higher this morning while unleaded is up a nickel. The weekly
export sales were good as an aggregate with -131,800 of old crop, and 986,000
of new crop. On the December chart support is at the early week low at $3.65,
and then the contract term low at $3.57. Resistance is at the $3.79 20-day
moving average, which we are just below. The next levels of resistance are the
$3.86 weekly high then the $3.94 100-day moving average.
Soybean trade is 12 to 17 cents higher at midday as commercial buying helps
trade regain the losses from yesterday. Meal is $1 to $2 higher and oil is 70
to 80 points higher. Trade will continue to watch weather to determine how the
crop will finish out, especially in the eastern belt. If the concerns over
forward Chinese demand can cool off it may help stop the downtrend with
progress being made today with additional 130,000 metric tons of fresh sales
being made today. The weekly export sales were good with -131,800 metric tons
of old crop, 1.46 million of new crop, 56,100 of old crop meal, 93,800 of new
crop meal, 17,100 of old crop oil, and 18,000 of new crop oil. On the November
soybean chart our new contract low this week at $8.55 is support with
resistance at $8.88, the previous contract low printed last week. The market
did come up on Tuesday and fill the gap left under $8.88 Sunday night. This is
a characteristic of a bear market when the market fills a gap then drops.
Wheat trade is 2 to 6 cents higher at midday finding support from the firmer
row crop trade. Most contracts tested recent lows or contract lows yesterday,
but are trying again to bounce enough to trigger short covering. The wheat
export market has been quiet in recent days with the U.S. still at a
competitive disadvantage to other origins of wheat. The weekly export sales
were stronger than expected at 529,100 metric tons. Chart resistance for the
September Kansas City contract is at the $4.77 the 10-day moving average.
Support is at the $4.61 3/4 fresh contract low reached Monday.
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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