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DTN Midday Grain Comments     01/29 11:07

   Grains Mixed at Midday

   Row crops are slightly lower while wheat is higher in slow midday action.

By David Fiala
DTN Contributing Analyst

General Comments

   The U.S. stock market indices are mixed at midday with the Dow futures up 25 
points. The interest rate products are higher. The dollar index is 19 higher. 
Energies are lower with crude down 0.50. Livestock trade is mixed. Precious 
metals are lower with gold down $25.


   Corn trade is 2 to 4 cents lower at midday with follow-through selling from 
the late day break yesterday below key chart support. Ethanol margins remain 
fairly stable and very tight with the weakness of the energy complex. The 
weekly export sales were stronger than expected at 1.07 million metric tons, so 
we have seen two good weeks of sales reports. The lower board should give the 
economics for additional good business, but the competition from South American 
will also be an issue looking forward this year. March chart resistance is now 
at the $3.77 100-day moving average with limited support below the market. If 
we cannot get back above it today fresh chart selling and fund long liquidation 
should not be a surprise as we head towards the close.


   Soybean trade has seen two-sided trade, and is mixed at midday. Meal is $2 
to $3 higher and oil is 60 to 70 points lower. South American weather remains 
good with most of the concerns concentrated in Northern Brazil. Some of the 
local crop forecasters have begun to scale back crop size projections slightly, 
but overall expectations remain very large and most see that we are to a point 
where it would be very hard to harm the crop. Soymeal continues to maintain an 
inverse with good demand for the front month, and overall meal is the main 
leader of the complex. The weekly export sales were much better than expected 
at 888,200 metric tons of soybeans, 296,500 of meal, and 10,600 of oil. The 
March soybean chart resistance is the 10-day moving average at $9.79, with 
support at the new low for the move put in this morning at $9.66. Major support 
is at $9.20 which is our contract low printed in early October. 


   Wheat trade has turned higher this morning, with gains of 5 to 10 cents 
across the three exchanges at midday following better than expected exports. 
Wheat is oversold, and we are seeing some light profit taking by shorts this 
morning. The firmer dollar will continue to limit export demand, but Russian 
restrictions take effect next week. The weakness of the Euro has made France 
much more competitive than they have been recently as well. Warmer weather 
across the Southern Plains will limit wheat stress but could encourage some 
wheat to leave dormancy early, with dryness concerns starting to build a across 
the plains as well. The weekly sales were stronger than expected at 544,400 
metric tons. The March Kansas City 10-day and lowest major moving average, at 
$5.64, serves as nearby chart resistance with limited support to note other 
than $5 at this point. 

   David Fiala is a DTN contributing analyst and the president of FuturesOne 
and a registered Trading Adviser. 
David Fiala can be reached at 
Follow David Fiala on Twitter @davidfiala


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