DTN Early Word Grains

By Darin Newsom
DTN Senior Analyst

6:00 a.m. CME Globex:

December corn was 2 cents lower, November soybeans were 1 cent lower, and December Chicago (SRW) wheat was 2 cents lower.

CME Globex Recap:

Grain and oilseed market traders seem to have adopted the old MAD Magazine slogan as their view on continued corn and soybean harvest delays. December corn never traded higher during the session, with November soybeans mustering a 1-cent rally before selling off. Pressure did not come from the U.S. dollar, the latter's index trading a little lower early Wednesday morning.

OUTSIDE MARKETS:

The Dow Jones Industrial Average closed 69.61 points (0.3%) higher at 22,830.68, the NASDAQ Composite gained 7.52 points (0.1%) to 6,587.25, and the S&P 500 added 5.91 points (0.2%) to 2,550.64 Tuesday. DJIA futures were 8 points lower early Wednesday morning. Asian markets closed mostly higher with Japan's Nikkei up 57.76 points (0.3%), Hong Kong's Hang Seng falling 101.26 points (0.3%), and China's Shanghai Composite adding 5.30 points (0.1%). European markets were trading mixed with London's FTSE 100 off 6.24 points, Germany's DAX up 8.25 points and France's CAC 40 down 6.24 points (0.1%). The euro was 0.0004 higher at 1.1812 while the U.S. dollar index slipped 0.02 to 93.24. December 30-year T-Bonds were 2/32 lower at 152'14 while December gold slipped $1.80 to $1,292.00. Crude oil was $0.37 higher at 51.28 while Brent crude gained $0.20 to $56.81. China's Dalian soybean market was higher and Malaysian palm oil futures were mixed overnight.

	BULL		BEAR
1)	Reportedly, this year's corn harvest continues to fall further behind average, though we still don't know how many acres were actually planted.	1)	December corn seems destined to test its contract low of $3.44 1/4.
2)	Similar to corn, this year's soybean harvest remains slowed by adverse weather.	2)	Commercial selling, indicated by stronger carry in futures spreads, continues to pressure soybeans.
3)	December Chicago wheat could be considered oversold, technically, possibly limiting new selling interest.	3)	From a technical point of view, winter wheat futures have shown they have no problem staying in an oversold situation for long periods of time.

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 If nothing else, December corn looks to have broken out of its narrowing wedge of a consolidation pattern overnight. Wednesday's range between trendlines ran from $3.50 to $3.49 1/2, with Dec corn only able to must a high of $3.49 overnight through early Wednesday morning while posting a low of $3.47. This brings the contract low of $3.44 1/4 into play, if not Wednesday at least before the release of USDA's October round of Crop Production and Supply and Demand reports Thursday (11 am CT). Fundamentally, harvest continues to be slowed by rains and wet field conditions, though this hasn't attracted buyers to the market.

SOYBEANS The previous two days have seen soybeans try to rally and fail, opening the door to increased pressure ahead of USDA's October round of Crop Production and Supply and Demand reports set for release Thursday (11 am CT). Technically November soybean's minor (short-term) trend remains up with the contract testing trendline support calculated Wednesday at $9.62. Nov beans posted an overnight low, through early Wednesday, of $9.63 1/2. Fundamentally, soybeans are seeing a similar story to corn with traders unwilling to buy the market despite continued harvest delays due to weather.

WHEAT Winter wheat continues to grind lower, with the December Chicago contract extending its minor (short-term) downtrend to a new low of $4.32 3/4 overnight. However, daily stochastics (short-term momentum study) have moved into oversold territory below 20%. This could be considered bullish, if not for wheat's characteristic of having its daily stochastics stay oversold for long periods at a time. Fundamentally, there is little to get excited about ahead of USDA's October round of monthly Supply and Demand and Crop Production reports set for release Thursday (11 am CT).

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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