The U.S. stock market indices are lower at midday with the Dow futures down 90 points with volatility continuing. The interest rate products are mixed. The dollar index is 60 lower. Energies are mostly lower with crude down 0.55. Livestock trade is mixed. Precious metals are higher with gold 3.90 higher.
Corn trade is flat at midday with trade scoring a new high for the move on the March at $3.68 1/2. Ethanol margins continue to see pressure with firm corn values and sliding energy values with ethanol futures edging slightly higher this morning. Basis is expected to remain mostly steady to weaker with trade at the upper end of the range. The daily export wire has been quieter recently as prices rise, although the U.S. should remain competitive on the world market in the near term. On the March chart support is now the 20-day at $3.59 with the 100-day at 3.57 below that, with the 200-day moving average at $3.76 the highest moving average and major resistance with the nearby chart resistance noted at the $3.68 upper Bollinger band.
Soybean trade is 7 to 9 cents higher at midday with trade turning higher after some initially weaker overnight trade due to some rains slated for Argentina, but not enough to change the near term pattern. Meal is $9 to $10 higher and oil is 25 to 35 points lower, with crush margins improving substantially. The strength in meal yesterday into today has given beans this strength as much as the Argentine weather concerns. Brazil continues to struggle with excessive rain in the areas with harvest on-going. The Brazilian real has gained vs. the dollar this morning, but fresh bushels should keep selling pressure on the market once Carnival wraps up, along with China going on holiday at the end of the week. Trade will be concerned about fresh cancellations by China after the large one announced yesterday. On the March, support is the 100-day at $9.88, with resistance the fresh high at 10.11 3/4.
Wheat trade is narrowly mixed at midday with trade remaining at the upper end of the range. The may be relief again in the extended forecast but the dry trend is expected to remain entrenched for the plains in the near term. The Black Sea area has seen some stressful weather for winter as well with little protective cover as winter winds down. The dollar is below 90 on the index, with the most recent rally fizzling again. On the chart, trade is back just above the 200-day at $4.72 today with the strong start to the week, with resistance the upper bolliger band at $4.93.
David Fiala is a DTN contributing analyst and the President of FuturesOne and a registered Advisor.
He can be reached at firstname.lastname@example.org
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