DTN Early Word Grains

6:00 a.m. CME Globex:

December corn was 1 cent higher, November soybeans were 2 cents higher, and July Kansas City (HRW) wheat was fractionally lower.

CME Globex Recap:

It's Friday, and grains have started the day mostly in the green. Soybeans showed the strongest overnight gain as the market tried to recover some of Thursday's sell-off. Corn was quietly, as usual, higher. And the wheat complex was mixed with only Chicago showing early gains. Outside markets were mostly higher with metals up while softs and energies were mixed. The U.S. dollar index and DJIA futures were both showing losses.

OUTSIDE MARKETS:

The Dow Jones Industrial Average closed 12.74 points lower at 21,397.29, the NASDAQ Composite added 2.73 points to 6,236.69, and the S&P 500 dipped 1.11 points to 2,434.50 Thursday. DJIA futures were 17 points lower early Friday morning. Asian markets closed mostly higher with Japan's Nikkei up 22.16 points (0.1%), Hong Kong's Hang Seng losing 4.48 points, and China's Shanghai Composite adding 10.42 points (0.3%). European markets were trading lower with London's FTSE 100 down 33.23 points (0.4%), Germany's DAX losing 64.32 points (0.5%), and France's CAC 40 off 23.06 points (0.4%). The euro was 0.0021 higher at 1.1173 while the U.S. dollar index was 0.17 lower at 97.37. September 30-year T-Bonds were 2/32 lower at 156'13 while August gold rallied $8.50 to $1,258.00. Crude oil was $0.16 higher at $42.90 while Brent crude added $0.18 to $45.40. China's Dalian soybean and Malaysian palm oil futures were both lower again overnight.

	BULL		BEAR
1)	December corn now finds itself in a short-term technically oversold situation.	1)	December corn moved to a new 4-week low this week, usually an indicator that bearish momentum is growing.
2)	Old-crop soybeans could be supported by the idea next week's Quarterly Stocks report might lean bullish.	2)	Daily, weekly, and monthly soybean charts are all showing downtrends.
3)	Minneapolis spring wheat could find solid buying interest heading into the weekend.	3)	Winter wheat markets could see increased pre-weekend harvest pressure develop Friday.

The weekly Newsom on the Market column can be found on subscription sites only. On DTN Pro it is in News/Town Hall and on MyDTN in News/Columns.

MORE COMMODITY-SPECIFIC COMMENTS

CORN Well, on the positive side of Thursday's meltdown in corn, new-crop December now finds itself technically oversold on its daily chart. On the negative side, that means the contract's low of $3.80 was easily within striking distance of its previous 9-week low of $3.79 1/4 and 12-week low of $3.78 1/4. Technically this could lead to a minor (short-term) rally, but Dec corn will likely need some fundamental reason to pull buyers back in. That means weather. Look for today to be a normal "Weather Market Friday" as traders position themselves ahead of the weekend based on the latest round of forecasts. As of this morning, the latest precipitation map shows only light coverage for much of the U.S. Midwest through next Tuesday morning. However, temperatures are expected to be below normal this weekend. This, combined with light covering of some of Thursday's sales, could spark a modest rally in the market. One last thing: Friday is also July option expiration, and the largest open interest still being held in $3.70 calls and $3.60 puts. This would suggest a close in the $3.65 range.

SOYBEANS Soybeans look bearish on daily, weekly, and monthly charts. "So other than that, how was the play last night Mrs. Lincoln?" Yes, early Friday morning sees contracts trying to rally. But unless the market sees a dramatic mood swing by traders it isn't too difficult to envision a scenario with contracts selling off into the weekend. Weather could provide light support as the remains of Tropical Storm Cindy bring flooding to parts of the U.S. Delta and southeastern Midwest. Otherwise, the short-term forecast shows only light rain coverage mixed with cooler temperatures. Technically November soybeans have not reached an oversold situation on its daily chart - yet. If Friday sees a similar move to what occurred Thursday daily stochastics (short-term momentum study) could find themselves below the oversold level of 20%. Friday is also expiration day for July options with the largest open interest being in the $10 call and $9.00 put. That should make for a fun day.

WHEAT The wheat complex was mixed early Friday with Chicago (SRW) higher while Kansas City (HRW) and Minneapolis (HRS) were unchanged to fractionally lower. The Minneapolis market could be explosive again Friday despite a 24-hour map showing South Dakota receiving a general rain. On the other hand the short-term forecast doesn't look too promising for much of the U.S. Northern Plains. Technically, despite a lower week this week (so far) July Kansas City remains in an uptrend on its weekly chart with a next target intermediate-term target at $4.90. However, such a move is likely to be put on hold as the minor (short-term) trend turned down earlier this week. Winter wheat, both Kansas City and Chicago, is vulnerable to some late pre-weekend harvest pressure as Friday progresses.

	DTN Cash	Change From	National	Contract	Change from
Commodity	Index	Prev Day	Avg. Basis	Month	Prev Day
Corn:	$3.25	-$0.06	-$0.38	Jul	$0.003
Soybeans:	$8.40	-$0.14	-$0.64	Jul	$0.005
SRW Wheat:	$4.40	-$0.02	-$0.21	Jul	$0.008
HRW Wheat:	$4.06	$0.01	-$0.62	Jul	$0.009
HRS Wheat:	$6.16	$0.08	-$0.40	Jul	$0.008

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

Darin can be followed throughout the day at www.twitter.com\DarinNewsom

(KA)

Copyright 2017 DTN/The Progressive Farmer. All rights reserved.