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GRAINS-U.S. corn, soybean futures edge higher; wheat weak

(Recasts, updates with U.S. trading, adds analyst quote, changes byline, dateline; pvs HAMBURG)

CHICAGO, Oct 25 (Reuters) - Chicago Board of Trade soybean and corn futures posted modest gains on Wednesday, with technical buyers and short-covering underpinning prices despite abundant supplies, traders said.

"Grain futures are mostly higher this morning getting a lift from chart traders buying on technical strength despite better progress on harvest," Farm Futures analyst Bryce Knorr said in a note to clients.

Wheat futures were slightly lower, giving up early gains after failing to hold support above key technical points.

Soybeans notched the biggest gains after falling to their lowest in nearly two weeks on Tuesday.

At 10:44 a.m. CDT (1544 GMT), Chicago Board of Trade soybeans for November delivery were up 2-1/4 cents at $9.77-3/4 a bushel.

CBOT December corn was up 1/2 cent at $3.53-1/4 a bushel, with prices consolidating near the 50-day moving average.

U.S. regulatory data showed that speculators held their biggest net short position in corn since early June. Traders have been stepping unwinding those bearish bets on signs of market weakness this week, providing underlying support to the market.

CBOT December wheat was 1/4 cent lower at $4.37-1/2 a bushel.

Wheat prices retreated from 2-1/2-week high after CBOT December failed to hold support above its 20-day moving average.

But some concerns about the Australian crop limited the declines.

"Wheat could be getting some background support from problems with the Australian harvest but the overall plentiful supply picture globally could limit rises," said Matt Ammermann, commodity risk manager at INTL FCStone.

Australia's wheat farmers face a double blow this year as dry weather slashes local production at a time when bloated global inventories are dragging on international prices for the grain. (Additional reporting by Michael Hogan in Hamburg and Naveen Thukral in Singapore; Editing by David Evans and Meredith Mazzilli)