DTN Before The Bell Grain Comments

By Darin Newsom
DTN Senior Analyst

Morning CME Globex Update:

There seems to be trouble in rumor land as soybeans gave back much of its 12-cent overnight gain by the end of the session Friday morning. Corn and wheat also saw gains trimmed, while DJIA futures saw a strong early rally erased and the U.S. dollar gained strength.

Other Markets:

DJIA futures	Lower
U.S. Dollar Index:	Higher
Gold:	Lower
Crude Oil:	Lower

Corn:

Corn contracts finished overnight trade higher, though a couple cents off session highs. It's likely light spillover selling from soybeans was seen (see below), with flat futures spreads hinting at little to no interest from commercial traders yet. Technically it could still be argued that both old-crop July and new-crop December are in minor (short-term) downtrends, though both could change that if buying enthusiasm ramps up during Friday's session.

Soybeans:

The overnight rally based on rumors of a U.S./China trade deal took old-crop July up as much as 12 3/4 cents and new-crop November to a gain of 11 1/2 cents. However, as overnight trade came to an end these contracts were showing gains of 4 1/2 cents and 4 1/4 cents respectively. If for some reason both close lower at the end of Friday's trade, signals of possible short-term bullish changes in trend could be set aside. Look for the market to remain susceptible to the latest headlines released over the course of the day. It was a busy morning for announcements from USDA regarding soybeans with sales of 56,000 mt of 2017-2018 and 112,000 mt of 2018-2019 both sold to unknown, offset by cancellations of 829,000 mt of 2017-2018 and 120,000 mt of 2018-2019 also by unknown.

Wheat:

Wheat markets held firm through the close of overnight trade, though off session highs a bit. While the July-to-September Kansas City (HRW) futures spread showed a slightly stronger carry, implications of renewed commercial selling need to be set aside until Friday's session confirms with similar action. Until then, spread activity can be chalked up to low volume overnight trade.

Darin Newsom can be reached at darin.newsom@dtn.com

FollowDarin on Twitter @DarinNewsom

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