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DTN Midday Grain Comments     01/19 11:24

   Grains Narrowly Mixed at Midday

   Narrowly mixed slow midday trade is seen at midday.

By David Fiala
DTN Contributing Analyst

 General Comments

   The U.S. stock market indices are lower with the Dow futures down 20. The 
interest rate products are lower. The dollar index is 11 points higher. 
Energies are mixed with unleaded down a penny and crude up $0.40. Livestock 
trade is mostly higher. Precious metals are lower with gold down $12.  

   CORN

   Corn trade is a penny higher at midday in slow trade. Ethanol is down 2 
cents at midday with another disappointing January day for ethanol production 
margins. Ethanol stocks were up 5.54% on the weekly EIA estimates with 
production up 0.48% with gasoline demand estimated 4.73% lower. DDG prices have 
fallen as well albeit they may see some support due to the spike in meal this 
past week. This is limiting upside in corn today, and in the bigger picture. 
Argentine weather continues to be the noted supportive factor with highs in the 
90s and low 100s the next 10 days with limited moisture in the forecasts. 
Commodity funds have been adding length this week, if it continues there may be 
short covering late today into Friday. There is plenty of hedge selling 
interest on higher prices which has kept corn from sharp upside moves with 
funds adding length this week. The weekly export sales report is delayed until 
tomorrow. On the March corn chart support is at the $3.60 10-day moving average 
then the 20-day at $3.55. Resistance is at the $3.69 6-month high followed by 
the $3.70 200-day moving average. The morning high has been $3.67.

   SOYBEANS

   Soybean trade is a penny lower this has us near the daily highs after 
trading 8 lower. Meal is down $1 and bean oil is up 10 points. The weakness 
overnight was noted as light long profit taking, granite a change in the 
forecasts could quickly have futures crashing lower, but for now the weather 
news has not changed. There is concern and reason for weather premium. On the 
March soybean chart support is at the 10-day and highest major moving average 
at $10.34. The high printed yesterday at $10.80 is resistance which was a new 
6-month high. The next level of resistance would be the $11 area; then the 
March futures high last June at $11.35. The chart still looks like a potential 
double top here even though we surpassed the late November high by about a 
nickel it is still close. If the weather forecast remains supportive, and fund 
buying continues like it has this week, a short squeeze by market logs may 
occur. Brazilian weather is more favorable, so there is a favorable weather 
picture as well.  

   WHEAT

   Wheat trade is again mixed with Minneapolis up a nickel at midday, Chicago 
down 4 and Kansas City down 5 cents. This market has the ability to be volatile 
on any day over the next several weeks following the move this month. Activity 
today is moderate. The Minneapolis contract has been more dynamic; there has 
been a 50 cent rally just this month, and the high on Tuesday was a full dollar 
above the low printed at the end of August. So we've priced-in some recovery 
from oversold conditions and a few spring wheat production problems. But world 
supplies still remain historically very large. The March Kansas City chart 
support is at the $4.42 10-day moving average, resistance is at the $4.59 
200-day moving average. 

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


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