DTN Midday Grain Comments 05/04 11:20
Wheat, Soy Higher at Midday
Trade is mixed to lightly higher at midday with some upside momentum
following the double digit Tuesday losses.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are lower, with the Dow down 100. The interest
rate products are mixed. The dollar index is 32 points higher. Energies are
mixed with crude down 0.05. Livestock trade is mixed. Precious metals are lower
with gold down $9.
Corn trade is narrowly mixed at midday in quiet trade with a 6 cent range so
far. Weather is warming which is welcome and will be good for the crop. Basis
has started to stabilze after dropping off sharply with the rally. Brazilian
double crop corn size will continue to be debated with some sources indicating
much higher acres than expected offsetting dryness. The weekly ethanol
production report showed production down 0.43%, stocks up 2.64%, and gasoline
demand was 2.01% higher. Japan bought 107,500 metric tons of new-crop corn. On
the July chart, trade has set back below the 10-day and 200-day moving averages
at $3.86 and the 20-day at 3.80, which are now resistance and the 50-day at
$3.72 is support with trade just below the 20-day at midday.
Soybean trade is 5 to 9 cents higher at midday with trade finding some light
buying during the day session so far. Meal is $3 to $4 higher and oil is 15 to
25 points higher. The market will start to focus on saturated areas where corn
planting could get late and move to beans, otherwise for the start of May the
planting progress is a fairly neutral market item at this juncture. Increased
acres from corn could become more of a factor. Harvest progress should continue
to pick up in South America with questions remaining about quantity and quality
in Argentina. The momentum lower has stalled this morning, keeping more support
in place on the chart. On the July soybean chart the 10-day moving average at
$10.24 is support which we are testing this morning with resistance at the
$10.57 high printed yesterday.
Wheat trade is 1 to 4 cents higher at midday across the three contracts with
support from improved row crop trade. The Kansas wheat tour will continue
through the end of the week, with a mixed of disease and strong yield potential
found so far. World weather is fairly benign at this point, although the
Candadian Prairie has been pretty dry this spring. The July Kansas City chart
has resistance at the $4.74 20-day with support at the recent and contract lows
printed in March at $4.52 3/4 which we are just above today.
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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