DTN Midday Grain Comments 04/29 11:16
Little Trade in Grains at Midday
Trade is fairly flat across the board at midday, quiet following this active
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are lower, with the Dow down 165. The interest
rate products are mixed. The dollar index is 70 points lower. Energies are
mixed with crude down 0.40. Livestock trade is mostly higher. Precious metals
are higher with gold up $30.
Corn trade is narrowly mixed at midday with trade fading from early
strength. Corn is poised to post a strong monthly gain at the conclusion of
trade today which could trigger additional chart buying and/or short covering.
South American weather has shown some improvement, but dryness looks to return
to Brazil in the extended forecast which could continue to stress the second
corn crop, with more talk of export reductions from Brazil. Cooler and wetter
weather here will keep planting slow is areas in the near term, but overall
progress remains ahead of pace and should stay that way with warmer and drier
weather returning in the extened forecast. Ethanol margins remain fairly stable
with blender margins improving on unleaded strength this week. The USDA
announced 100, 640 metric tons of corn sold to Japan. On the July chart support
is the 200-day at 3.88, with resistacne at the high printed last week at $4.07.
Soybean trade is flat to 3 cents lower at midday with trade seeing another
20 cent trading range so far. Meal is flat to $1.00 higher and oil is 10 to 20
points lower. Planting progress will remain slow in the US, but it is too early
to be an issue with pace expected to accelerate next week. Argentina harvest
should start to gain more momentum soon with flooding starting to recede. The
chart continues to hold the up trend with support found on Monday at the 10-day
and highest major moving average. On the July soybean chart the 10-day moving
average at $10.12 is support with resistance at the $10.46 1/4 high put in
Wheat trade is narrowly mixed trade treading water this morning with limited
spillover from the row crops and support coming from the sharply lower dollar.
Trade was unable to hold gains yesterday, and continues to struggle to
consolidate breakouts. The bull argument continues to need improved export
demand with world supplies still ample overall with further weakness in the
dollar needed to encourage buyers. The weekly export sales were strong at
351,900 metric tons of old crop, and 454,700 of new crop, but that will need to
happen consistently before the market gets excited about it. Disease concerns
will continue in some of the wetter areas. The cold weather in continental
Europe will slow growth there, but Russia has seen good weather so far, along
with improvement in Ukrainian conditions. The July Kansas City chart had
resistance at the $4.76 3/4 20-day which we have are hanging around this
morning and support at the recent lows at $4.53.
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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