DTN Early Word Grains

Simply Red

6:00 a.m. CME Globex:

December corn was fractionally lower, November soybeans were 7 cents lower, and December Chicago (SRW) wheat was 1 cent lower.

CME Globex Recap:

Following Wednesday's close, particularly in soybeans, it's not overly surprising the grain and oilseed complex is showing red early Thursday morning. In other news, Wednesday's announcement by the Federal Reserve that interest rates will likely rise in December had gold on the defensive to the tune of roughly $17. The energy complex was also under pressure despite a slightly weaker U.S. dollar.

OUTSIDE MARKETS:

The Dow Jones Industrial Average closed 41.79 points (0.2%) higher at 22,412.59, the NASDAQ Composite lost 5.28 points (0.1%) to 6,456.04, and the S&P 500 gained 1.59 points to 2,508.24 Wednesday. DJIA futures were 13 points lower early Thursday morning. Asian markets closed mostly lower with Japan's Nikkei up 37.02 points (0.2%), Hong Kong's Hang Seng off 17.47 points, and China's Shanghai Composite down 8.18 points (0.2%). European markets were trading mostly higher with London's FTSE 100 up 6.14 points, Germany's DAX gaining 40.31 points (0.3%), and France's CAC 40 rallying 28.82 points (0.5%). The euro was 0.0018 higher at 1.1912 while the U.S. dollar index dipped 0.04 to 92.41. December 30-year T-Bonds were 2/32 higher at 153'26 while December gold lost $17.80 to $1,298.60. Crude oil was $0.19 lower at $50.50 while Brent crude slipped $0.15 to $56.14. China's Dalian soybean futures were mixed and Malaysian palm oil futures were lower overnight.

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BULL BEAR
1) Dec corn continues to hold above its contract low. That's all I've got for a bullish nugget in corn. 1) The path of least resistance in corn looks to be down.
2) Announcements of new export sales continue to roll in for 2017-2018 soybeans. 2) November soybeans look to have established a double-top on its daily chart.
3) Winter wheat markets remain in a short-term uptrend. 3) If the other grain and oilseed markets remain under pressure, wheat will likely follow.

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 It's another quiet morning in corn as the December issue posted an overnight trading range of less than two cents on trade volume (futures only) of 7,200 contracts. Dec corn continues to grind lower, sitting within a nickel of its contract low at $3.44 1/4. Harvest is just getting under way in some areas, while old-crop makes its way to town in other parts of the U.S. The bottom line is there remains nothing for the market to get excited about, particularly with USDA's Quarterly Stocks report just over a week away, set for release on Friday, September 29.

SOYBEANS Wednesday's 4-cent rally in the soybean market wasn't all that impressive when you consider it had earlier extended its gains to 8 cents on the announcement of large sales of 2017-2018 (predominantly) supplies. Given Wednesday's close it isn't overly surprising to see the market under pressure early Thursday, having spent much of the overnight session below unchanged. In fact, at $9.63 3/4 the Nov contract was one tick off its session low. Nov beans' daily chart continues to show a possible double-top near $9.77 1/2 with support expected at $9.55 1/2. Fundamentally the carry in the markets 2017-2018 forward curve continues to strengthen, indicating a more bearish view of supply and demand.

WHEAT Winter wheat contracts were lower early Thursday morning following a quiet overnight session. However, it's interesting to note that the December Chicago contract did post a new high for this short-term uptrend of $4.52 overnight, pulling daily stochastics (short-term momentum study) above the overbought level of 80%. This sets the stage for a possible bearish turn, with initial resistance still sitting above the market at $4.62 1/2. If the U.S. dollar index stays under pressure, and if the wheat market can disassociate itself from corn and soybeans, from a technical point of view it should be able to extend its uptrend.

DTN Cash Change From National Contract Change from
Commodity Index Prev Day Avg. Basis Month Prev Day
Corn: $3.06 $0.02 -$0.44 Dec $0.003
Soybeans: $9.00 $0.04 -$0.70 Nov -$0.001
SRW Wheat: $4.06 $0.06 -$0.44 Dec -$0.005
HRW Wheat: $3.68 $0.06 -$0.80 Dec $0.004
HRS Wheat: $5.71 $0.04 -$0.50 Dec $0.000

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

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

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