DTN Midday Grain Comments

General Comments

The U.S. stock markets are flat to higher with the Dow up 15 points. The interest rate products are mixed. The dollar index is 35 points higher. Energies are lower with crude down $0.50. Livestock trade is mostly higher. Precious metals are lower with gold down $3.

CORN

Corn trade is flat to 2 cents higher at midday with commercial buying overcoming the stronger dollar and weaker crude trade. Volume is expected to remain poor this week with the Thanksgiving holiday trade and limited possible material market news. The weekly ethanol production report showed production up 3.38% to a new record level, and stocks were 1.96% higher, with gasoline demand 1.47% lower. On the December chart, first support is the 10-day moving average at $3.62, and then the recent low at $3.56, with resistance that 20-day moving average at $3.68. Trade has not challenged the 20-day significantly today, and it looks like we will stay below that areas going into the break. For the holiday we will have a normal close today then open Friday morning at the day session opening time and close at noon. If any trade volume shows up in thin holiday trade we could always have some excitement, but for today the less than 4 cent trading range through midday forecasts a slow afternoon.

SOYBEANS

Soybean trade is 5 to 9 cents higher with commercial buying adding more support during the day session. Meal is flat to $1 higher and oil is 25 to 35 points higher. South American weather brings some rains late this week, and a wetter extended forecast for some areas but some holes are likely to remain. Soybeans basis has been fairly quiet in recent days, with no major moves yet. If Argentina drops export taxes more soybeans could move onto the world market in the near term but there appears to be some near term political hurdles to accomplishing this. On the January chart, support is at the $8.45 contract low. Resistance is the 20-day moving average at $8.65 which we have moved above at midday. Monday was an outside day with a higher close for beans, plus a key reversal due to a close at a three-day high. If we can hold the move through the 20-day moving average it may encourage further chart buying.

WHEAT

Wheat trade is narrowly mixed across the three contracts this morning with Minneapolis trade leading with commercial selling showing up in the Chicago trade. The dollar has moved solidly higher this morning as well. Russian conditions should improve this week heading towards dormancy, with no major cold threats in the near term. Egypt bought French wheat with their tender this morning. Winter storms will bring moisture so some wheat country the next few days. On the December Kansas City chart support is at the new contract low printed yesterday at $4.49 with resistance at the $4.73 20-day moving average.

David Fiala is a DTN contributing analyst and the President of FuturesOne and a registered trading adviser.
David Fiala can be reached at dfiala@futuresone.com
Follow David Fiala on Twitter @davidfiala

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