Grains Move Lower as Dollar Gains Traction

Grain prices are moving sideways, waiting for an impetus to drive them higher. The dollar has moved higher this week weighing on commodity prices, and despite a robust up move in oil prices, the strength of the greenback has capped grains advance.

Corn Prices

Weekly corn export sales for the 2017/18 marketing season of 1,091.7 TMT, rose 30% from last week but were 4% below the prior 4-week average.  New crop sales came in as at 112.2 TMT, lifting combined sales to 1,203.9 TMT. Total sales exceeded analyst expectations that ranged from 700 to 1,150 TMT. Increases were reported for Columbia, Taiwan, and Japan. 2017/18 export commitments are 87% of the USDA forecast and need to average 362 TMT per week to meet projections. Export sales trail last year’s pace by 2%.

Corn prices moved lower and is poised to test trend line support which is an upward sloping trend line that comes in near 379. Resistance is seen near the 10-day moving average at 385. Momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. The MACD histogram is printing in the red with a downward sloping trajectory which points to lower prices.

Soybean Prices

Soybean export sales for the 2017/18 marketing year came in at 1,040.7 TMT, down 31% from last week  but 11% more than the prior 4-week average.  Sales for the 2018/19 crop year totaled 1,090.7 TMT, lifting combined sales to 2,131.4 TMT.  Combined sales were down 14% week over week and exceeded analyst estimates that ranged from 1,400-2,100 TMT. 2017/18 export commitments are 96% of the USDA forecast with 20 weeks to go and need to average 108 TMT weekly to meet projections. Current sales are 3% behind last year’s pace. Major purchases were reported for Egypt, Indonesia, and Mexico.

Soybean prices moved lower breaking through support near the 50-day moving average at 1034.5 in early North American trade. Momentum is negative as the MACD is poised to generate a crossover sell signal. The MACD  (moving average convergence divergence) histogram is printing in the red with a declining trajectory which points to lower prices. The RSI (relative strength index) also broke down which reflects accelerating negative momentum.

Wheat Prices

Wheat prices moved lower in early North American trade reversing the gains experienced on Thursday. Prices lost support near the 10-day moving average at 477, which is now seen as resistance. Target support is seen near and upward sloping trend line at 450. Target resistance is seen near a downward sloping trend line at 490. Momentum is neutral as the MACD is prints near the zero-index level with a flat trajectory which points to consolidation.