DTN Midday Grain Comments 09/09 11:10

DTN Midday Grain Comments 09/09 11:10 Grains Mostly Trading Lower at Midday Soybeans are the downside leader at midday after challenging chart resistance early. By David Fiala DTN Contributing Analyst General Comments The U.S. stock markets indices are higher at midday with the Dow futures up 25 points after being up over 200 early. The interest rate products are lower. The dollar index is 25 points higher. Energies are lower with crude down $0.90. Livestock trade is mixed. Precious metals are lower with gold down $12. CORN Corn trade is steady to a penny higher at midday after trading near a nickel higher a short while ago. Spillover pressure from beans and the stock market giving back gains appears to be behind us giving back our gains. Corn futures finished last week near the contract lows so the trade appears to be viewing the bearish items as priced-in, but upcoming harvest pressure is limiting buying at midday. We have a big Friday this week with the monthly USDA World Agricultural Supply and Demand Estimates (WASDE) due out and then a big month ahead with good harvest activity expected by the October WASDE. Looking to Friday the average trade guess is for a 167.6-bushel-per-acre yield with a range of 166-170.5 versus the 168.8 August number. The total production average trade guess is at 13.595 billion with a range of 13.47 to 13.87 billion. The new crop carryover estimate is 1.645 billion bushels versus 1.713 a month ago. The world carryover is expected to be at 193.5 million metric ton versus 195.1 last month. Position squaring should dominate trade the next two days with shorts desiring to take profit ahead of the report the friendly item and support expected around the contract lows. On the December chart support is at the low from last week at $3.60 and then the contract low at $3.57. Resistance is at the $3.73 20-day moving average then the $3.86 high printed two weeks ago. Momentum is flat to down at midday after we failed just below the 20-day. SOYBEANS Soybean trade is 4 to 7 cents lower at midday after trading over a nickel higher early. Meal is steady and bean oil down 20 points. Support this morning was noted from a firmer stock market, light commercial buying and short profit taking. On the chart the 20-day at $8.88 is key resistance versus the November $8.85 3/4 high this morning. Looking to Friday the trade is expecting the USDA to come out with a 46.4 bushel per acre yield versus the 46.9 number seen last month; the range of trade guesses is 45.4 to 47.1. Most believe the weather has been good enough the past month to keep the yield number steady but the areas too wet early still have many looking for the USDA August number to be the highest of the year. The crop estimate is at 3.87 versus 3.916 last month. The world carryover is expected to be at 86.2 versus 66.9 last month. So no major changes are expected, the big supplies, expected increase in South American plantings and slower than a year ago export sales pace continue to favor the bears. Most market bulls believe the yield number will come down. We hit new contract lows at $8.55 after the bearish August report; this level remains key support. WHEAT Wheat trade is 1 to 2 cents lower across the three contracts with spillover support early from the row crops and spillover weakness here at midday. European wheat values have been rising which should add some follow-through support and maybe help trigger some short covering but spillover support appears to be needed. Weak fundamentals and chart pressure will continue to limit upside, some profit taking vs. shorts could pick up ahead of the report this Friday. Winter wheat planting is just around the corner which could trigger a bit of a rally to secure acres as well with rains in the west limiting enthusiasm in the near term. The average trade guess is for the wheat carryover to be at 865 million bushels versus 850 on the August report. The world carryover is expected to be in line with the large 221.5 million metric ton carryover seen on the August report. Chart resistance for the December Kansas City contract is at the $4.80 10-day moving average. Support is at the $4.65 fresh contract low reached Friday. David Fiala is a DTN contributing analyst and the President of FuturesOne and a registered trading adviser. David Fiala can be reached at dfiala@futuresone.com Follow David Fiala on Twitter @davidfiala (BAS) Copyright 2015 DTN/The Progressive Farmer. All rights reserved.