DTN Early Word Grains

The Stockings Were Hung

6:00 a.m. CME Globex:

March corn was fractionally higher, March soybeans were 2 cents higher, and March Chicago (SRW) wheat was 1 cent lower.

CME Globex Recap:

The grain and oilseed complex was mixed following another quiet overnight session with soybeans higher, winter wheat lower, and corn fractionally higher. Other commodity sectors were also quiet, except for bitcoin, though most markets were showing green early Wednesday. The U.S. dollar index was posting a small loss while DJIA futures rallied once again as the U.S. tax reform frenzy continues.

OUTSIDE MARKETS:

The Dow Jones Industrial Average closed 37.45 points (0.1%) lower at 24,754.75, the NASDAQ Composite lost 30.91 points (0.4%) to 6,963.85, and the S&P 500 dipped 8.69 points (0.3%) to 2,681.47 Tuesday. DJIA futures were 83 points higher early Wednesday morning. Asian markets closed mixed with Japan's Nikkei 225 up 23.72 points (0.1%), Hong Kong's Hang Seng losing 19.57 points, and China's Shanghai Composite off 8.93 points (0.3%). European markets were trading mostly lower with London's FTSE 100 down 8.89 points (0.1%), Germany's DAX off 14.03 points (0.1%), and France's CAC 40 down 9.23 points (0.1%). The euro gained 0.0008 to 1.1847 as the U.S. dollar index lost 0.03 to 93.43. March 30-year T-Bonds were 3/32 higher at 151'19 while February gold gained $4.80 to $1,269.00. January bitcoin (CME) was $400 lower at $17,800. Crude oil was $0.18 higher at $57.74 while Brent crude slipped $0.05 to $63.75. China's Dalian soybean and Malaysian palm oil futures were lower overnight.

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BULL BEAR
1) Incredibly enough, new-crop December corn established a bullish short-term technical signal at the close of Tuesday's session. 1) If bullish corn traders walk away from the market for a minute, it would be easy for new contract lows to be set.
2) With the CFTC weekly reporting period ended as of Tuesday's close, soybeans could try to rally again. 2) Talk in the soybean market continues to center on another massive crop coming out of Brazil.
3) Continued dryness across the U.S. Southern Plains has helped put the July Kansas City wheat contract in position for a bullish turn on its weekly chart. 3) March Chicago wheat posted a short-term bearish reversal after testing technical resistance at its 20-day moving average Tuesday.

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 March corn posted a 3/4 cent trading range overnight on trade volume (futures only) of 4,300 contracts. So yes, one could say not even a mouse was stirring in the market. Still, old-crop contracts are in position to establish short-term technical signals on their respective daily charts indicating minor trends are turning up. New-crop December was able to pull off that feat, almost without notice, with Tuesday's fractionally higher close. While the corn market isn't expected to go bounding higher, these short-term technical signals could be a hint that noncommercial traders are set for a round of end-of-the-year short-covering now that Tuesday's reporting period (for the next CFTC Commitment of Traders report set for release this coming Friday) has come to an end.

SOYBEANS It wasn't a surprise to see soybeans posting a modest gain early Wednesday morning. After all the loss from this past Tuesday-to-Tuesday week was approximately 21 cents, with chatter hinting at noncommercial traders possibly liquidating the last remnants of their net-long futures-only position. Last Friday's CFTC Commitment of Traders report (for the week ending Tuesday, December 12) showed this group reducing the position by 37,340 contracts to 55,245 while March beans fell roughly 33 cents. The question is now was volume heavy enough over the last week to completely erase thee 55,245 contracts. It would appear not, meaning this group should be shown to still be holding a small net-long futures-only position in this coming Friday's report. Fundamentally, it's all about South American weather as North American traders head into the holiday.

WHEAT Winter wheat contracts were lower early Tuesday morning, with overnight trade volume for the March Chicago contract more than what was seen in March corn (6,400 contracts to 4,300 contracts). Once again it looks as if the 20-day moving average has turned away a short-term rally by Chicago wheat as the nearby contract falls back from Tuesday's high of $4.24 with the 20-day moving average calculated then at $4.26 1/2 and Wednesday at $4.25 1/2. Speaking of Tuesday's session, March Chicago wheat also posted a bearish outside range, also called a minor (short-term) bearish reversal hinting at a possible back to a test of its recent low of $4.10 1/2. On a more bullish note, new-crop July Kansas City wheat remains in position to establish bullish technical signals on its secondary (intermediate-term) weekly chart, though will need to see renewed buying interest before the end of the week to do so.

DTN Cash Change From National Contract Change from
Commodity Index Prev Day Avg. Basis Month Prev Day
Corn: $3.09 $0.01 -$0.38 Mar $0.000
Soybeans: $8.87 -$0.05 -$0.69 Jan $0.006
SRW Wheat: $3.83 $0.00 -$0.36 Mar $0.006
HRW Wheat: $3.67 $0.01 -$0.53 Mar -$0.002
HRS Wheat: $5.92 -$0.01 -$0.26 Mar $0.004

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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