DTN Early Word Grains

Big Game Hangover Blues

6:00 a.m. CME Globex:

March corn was 1 cent lower, March soybeans were 3 cents lower, and March Chicago wheat was 1 cent lower.

CME Globex Recap:

Commodities in general were lower early Monday morning with grain contracts at near overnight session lows. Only gold was higher, possibly buoyed by the number of times it was highlighted it last night's big game, the 50th national football championship. The U.S. dollar index was showing a small gain while DJIA futures were sharply lower.

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OUTSIDE MARKETS:

The Dow Jones Industrial Average closed 211.61 points lower at 16,204.97, the NASDAQ Composite was down 146.42 points at 4,363.14, and the S&P 500 fell 35.40 points to close at 1,880.05 Friday. DJIA futures were 194 points lower overnight. Asian markets were mostly higher with the Nikkei up 184.71 points (1.1%) while China's Shanghai Composite was closed for a weeklong national holiday. European markets were lower with London's FTSE 100 down 108.96 points (1.9%). The U.S. dollar index was 0.135 higher at 97.166. Crude oil was down $0.75 at $30.15 while Brent crude was off $0.69 to $33.37. April gold was $18.10 higher at $1,175.80.

BULL BEAR
1) Last week saw national average basis for corn hold steady at 23 1/2 cents under. 1) March corn remains in a minor (short-term) downtrend.
2) March soybeans tested, and held, minor (short-term) technical price support overnight. 2) Favorable weather for Brazil and China on a weeklong holiday could keep the soybean market on the defensive.
3) March Chicago wheat is nearing a short-term technically oversold situation. 3) The wheat market could continue to feel the pressure of a stronger U.S. dollar index.

See Grain Archives for more information on the fundamental situation in grains. See the DTN Ag Weather Brief for complete market weather comments.

MORE COMMODITY-SPECIFIC COMMENTS

CORN The corn market was lower overnight with the March issue extending its minor (short-term) downtrend through initial support near $3.65 1/4. Next support is pegged at $3.61. Overnight volume was relatively light with only 8,200 contracts (March corn) changing hands. Monday's session is expected to remain quiet given Tuesday's lineup of USDA reports set for release. Last week saw national average basis hold steady with Friday's DTN National Corn Index (national average cash price) calculated at $3.42 1/4, 23 1/2 cents under the close of the March futures contract.

SOYBEANS Soybeans were lower overnight, not surprising given China is closed for business this week as the country celebrates its New Year's holiday. March beans tested minor (short-term) support at $8.64 on modest volume of 9,500 contracts, while daily stochastics (short-term momentum study) near the oversold level of 20%. Last week saw the market come under pressure from commercial selling, likely due in large part to China's holiday, with the carry in the March-to-May futures spread strengthening to 3 3/4 cents while national average basis weakened. Friday's DTN National Soybean Index (national average cash price) was calculated at $8.19 1/2, 48 cents under the close of the March futures contract. The previous Friday has national average basis at 46 3/4 cents under. Monday's trade is expected to be quiet given a lack of business from China and Tuesday's scheduled USDA reports.

WHEAT Winter wheat contracts were lower early Monday with most contracts at or near overnight session lows. Trade volume for the Chicago March issue was relatively light at 3,000 contracts as it tested minor (short-term) support between $4.66 3/4 and $4.63 3/4. These prices mark the 67% and 76.4% retracement levels of the previous rally from $4.56 through the high of $4.88 1/2. Daily stochastics (short-term momentum study) show the March contract is nearing an oversold situation. Wheat contracts are expected to stay under pressure Monday due to a stronger U.S. dollar index and USDA's February reports scheduled for Tuesday.

DTN Cash Change From National Contract Change from
Commodity Index Prev Day Avg. Basis Month Prev Day
Corn: $3.42 -$0.03 -$0.23 Mar -$0.002
Soybeans: $8.20 -$0.08 -$0.48 Mar -$0.007
SRW Wheat: $4.25 -$0.06 -$0.42 Mar -$0.003
HRW Wheat: $3.97 -$0.08 -$0.57 Mar -$0.018
HRS Wheat: $4.66 -$0.06 -$0.25 Mar -$0.025

Darin Newsom can be reached at darin.newsom@dtn.com

Darin can be followed throughout the day at www.twitter.com\DarinNewsom

(CZ)

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