DTN Midday Grain Comments 07/18 11:44
Grains Mixed at Midday
Mixed midday trade is seen with the market giving back some light early
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are mixed with the Dow futures up 85. The
interest rate products are firmer. The dollar index is 5 points higher.
Energies are mostly firmer with crude up $0.30. Livestock trade is mixed with
cattle higher and hogs lower. Precious metals are slightly lower with gold down
Corn trade is flat to a penny higher at midday after trading 3 cents higher
early in the morning session. On the chart it appears the market is trying to
move through nearby resistance, but is taking its time. Outside markets are
neutral at midday, and weather is fairly benign. Cooler weather looks to hang
around the next couple weeks with mixed moisture potential with a growing focus
on early August weather with the advanced state of the crop. Ethanol board
margins remain positive but have narrowed with firmer corn and weaker energy
trade. Corn basis has been flat to firmer for the most part. On the September
chart futures are around the 10-day at $3.47, with the 20-day at $3.53 chart
resistance. Support is the fresh low of $3.37 1/4 scored last week which is
also the level of the lower Bollinger Band.
Soybean trade is mixed at midday after some higher overnight and early-day
session strength with soybeans continuing to try to work higher after reversing
on Monday. Meal is mixed and bean oil is 20 to 30 points higher. Brazil remains
at a stout premium to U.S. origin, which is compounded by the ongoing logistics
issues with Brazil with premiums around $2.05, which almost equals the tariffs
placed by China. Bean basis has remained steady with processors taking the lead
with crush margins remaining exceptionally strong. The daily export wire has
remained quiet. Weather should not be a major driver near term for soybeans due
to limited stressful forecasts but with pod fill starting beans could be more
active based upon any forecast changes. On the August chart the 10-day at
$8.42 is again the first level of resistance which we were we are trading this
morning with further support the lower Bollinger Band at 8.13 with the next
level resistance the 20-day at 8.58.
Wheat trade is 1 lower to 4 cents higher at midday with trade working to
consolidate the attempt at an uptrend we are seeing since the report last week.
Harvest pressure should start to fade as it winds down for the winter wheat.
Spring wheat should see good progress with Canada with drier weather showing up
again for some. Russian harvest continues to move along as well with yields
remaining below last year's levels as they get into spring wheat harvest. HRW
basis has remains solid through harvest with the better protein with offered
premiums declining. On the September KC is just above the 20-day at $4.90 and
the 10-day at $4.93 overnight with the 200-day at 5.11 the next level of
David Fiala is a DTN contributing analyst and the President of FuturesOne
and a registered adviser.
He can be reached at firstname.lastname@example.org
Follow him on Twitter @davidfiala
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