DTN Midday Grain Comments 06/01 12:18

DTN Midday Grain Comments 06/01 12:18 Grains Mixed at Midday Trade is drifting lower from early gains at midday. By David Fiala DTN Contributing Analyst General Comments The U.S. stock market indices are firmer with the Dow up 200 points. The interest rate products are higher. The dollar index is 15 higher. Energies are lower with crude down 0.65. Livestock trade is mostly lower. Precious metals are mixed with gold down 3.70. CORN Corn trade has been narrowly mixed with trade down a penny at midday with trade pulling back from the early strength. Warm weather should dominate the week, with rain coverage shifting from model run to model run with better coverage for the next 7 days for the most part. The second crop areas of Brazil are trending back slightly drier. Ethanol margins are stable this morning with crude and ethanol futures drifting slightly lower. The weekly export sales were ok at 993,100 metric tons of old crop, and new crop was 149,300 metric tons. On the July chart we are right below the 50-day at $3.96 which is first resistance with the 100-day at 3.86 becoming support. Overhead resistance is the 20-day moving average at $4.01. This does appear to be a week where the 2018 weather market has surfaced; volatility has grown in option premium with normal market nervousness ahead of the next two very important growing weather months. SOYBEANS Soybean trade is narrowly mixed with early strength failing to hold yet again during the midday action. Meal is $2 to $3 lower, and oil is 20 to 30 points lower. Crush margins have narrowed but remain positive, with meal drifting back towards the $370 area. Basis has remained steady, with trade likely to remain quiet in the near term. Strikes and turmoil continue in Brazil which we help to offset their cheaper currency, but strides have been made. Weekly export sales showed improvement at 273,400 metric tons of old crop, 771,600 metric tons of new, 140,700 of old crop meal, and 6,000 of oil. On the July chart, trade tested the 20-day at $10.23 overnight, with the next support the 200-day at 10.17 which we are testing at midday and further resistance the 50-day at 10.37. Major support is the 200-day with the May low at $9.92 3/4 the next notable support. WHEAT Wheat trade is 4 to 9 cents lower at midday with selling returning overnight with overbought conditions and a lack of fresh bullish news limiting upside. Warmer weather should help to boost maturity with the crop still behind normal, with the southern plains drying out again the next seven days with early harvest likely to expand quickly the next two weeks. Spring wheat should see better progress with warmer weather helping to catch up emergence, with Canada remaining on the dry side, along with Ukraine trending drier. Australia is expected to see better short term rains. Black Sea values are at $205.50 a ton with world supplies remaining ample. The weekly export sales remained soft at 29,500 metric tons of old crop, and 270,900 metric tons. On the July Kansas City contract support is the 20-day at 5.35 which we are just below at midday, with the next level of support the 50-day at $5.23. 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 (BAS) Copyright 2018 DTN/The Progressive Farmer. All rights reserved.