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DTN Midday Grain Comments     01/18 11:47

   All Grains Higher at Midday

   Soybeans lead at midday with trade optimism boosting ag markets again.

By David Fiala
DTN Contributing Analyst

 General Comments

   The U.S. stock market indices firmer with the Dow 270 higher. The interest 
rate products are firmer. The dollar index is 30 points higher. Energies are 
firmer with crude up $1.60. Livestock trade is higher. Precious metals are 
mixed with gold down $10. 


   Corn trade is 1 to 2 cents higher in quiet trade at midday with market 
action looking to consolidate the late gains yesterday on improved trade 
optimism. The South American recent weather pattern remains intact with a mix 
of excessive rain and pockets of dryness with some potential improvement down 
the road. Ethanol margins remain poor with futures still near the lows even 
with firmer action this morning, while blender margins have struggled to 
maintain gains for the time being. Winter weather will likely slow corn 
movement again, keeping basis flat to firmer. The government partial shutdown 
is expected to continue to limit news. On the March chart support is the 
multiple moving averages at the $3.77-3.79 area, with resistance the upper 
Bollinger Band at $3.83 7/8.


   Soybean trade is 9 to 12 cents higher with trade building on the reversal 
yesterday on increases trade optimism and South American weather with talk of 
China making substantially offers towards future purchases. Meal is 3.50 to 
4.50 higher, and oil is 25 to 35 points higher. South America weather items 
remain in the recent weather pattern with harvest going early amid heat and 
pockets of dryness in Brazil with generally disappointing yields so far, and 
excessive rain potential in Argentina. Basis has been pretty flat with the 
weather likely to add support. Forecasts are being monitored closely. Support 
is the $9.06 50-day moving average, and resistance the 200-day at 9.25.


   Wheat trade is 1 to 3 cents higher at midday with trade building on the 
reversal from yesterday on talk of China importing wheat. The dollar has 
bounced last week into this week, but remains in the lower part our two-month 
range. Southern Hemisphere harvest will continue in the near term. North 
American winter wheat should see a cool down this week, with snow cover 
expected in front of the cold snap for most areas but will need to be watched 
with longer-term forecast warmer. Russia domestic prices will be watched 
closely with firmer values again there. On the March Kansas City chart, support 
is the 50-day at $5.04 with resistance the upper Bollinger Band at $5.11.

    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 him on Twitter @davidfiala


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