DTN Midday Grain Comments 12/19 11:33
All Grains Lower at Midday
Grain trade is lower across the board at midday.
By David Fiala
DTN Contributing Analyst
The U.S. stock market indices are flat to higher with the DOW futures up 10
points. The interest rate products are lower. The dollar index is 26 higher.
Energies are mixed with crude $1.80 higher. Livestock trade is mixed with
cattle higher and hogs lower. Precious metals are flat to higher with gold up
Corn trade is 2 to 3 cents lower at midday with light selling surfacing due
to spillover pressure from wheat and a firmer dollar. Ethanol margins remain
under pressure for the blender and producer, but plants continue to run hard
with basis mostly stable. Ethanol futures are lower at midday, while unleaded
gas futures are slightly higher. Corn exports were announced to Japan and
Mexico for a total of 237,200 metric tons. The March corn chart items remain
the same with support at $4.02 at the 10-day moving average and resistance at
the $4.22 200-day moving average. This has been a sideways trading week so
quiet action is expected. The trend remains up so if this Friday is a trend day
we should find our way into the green by the close.
Soybean trade is 5 to 10 cents lower at midday with meal $4 to $5 lower and
bean oil flat to 10 points higher. Spread trade has softened this week
indicating that commercial demand is slowing. The South American weather items
have not provided much impact this week. Nearby January chart support now is at
the $10.19 100-day then the $10.13 50-day. Resistance is at the $10.37 10-day
moving average, and the recent high at $10.60. Trade looks to stay mostly range
bound into the weekend. We are near the daily lows at midday and the trend is
leaning negative this week. So if we challenge the 100-day, currently around a
nickel below the market, we should expect sizeable sell stops under it. This
could give us more active trade versus the slower midday action.
Wheat trade is 8 to 18 lower across the three exchanges at midday with
profit taking surfacing after the strong run we have seen this week. Selling
has been mostly non-commercial so far with commercial business still concerned
over future disruptions from Russia. Weather items appear fairly benign with
some beneficial snow cover developing in some northern hemisphere locations.
The dollar is back at the recent highs which should help to keep some sort of
lid on rallies. On the March KC chart we moved through the 200-day moving
average at $6.82 early in the week, but failed to hold the area, which leaves
support at the 10-day moving average of $6.47 for now. The Chicago March
200-day and highest major moving average is at $6.15, which trade remains
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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