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GRAINS-Soybeans slump on technical selling, South America rains

* Soybeans weighed down by technical selling

* Corn hovers near recent contract lows

* Cold Plains weather supports wheat (Recasts with U.S. market open, updates prices, adds analyst quote, changes byline, changes dateline from HAMBURG)

CHICAGO, Dec 19 (Reuters) - U.S. soybean futures fell on Tuesday for the ninth time in 10 sessions on technical selling and forecasts for crop-boosting rains in South America.

Winter wheat futures firmed on signs of improving export demand and worries that frigid temperatures forecast for the Plains wheat belt may damage crops. Corn was narrowly mixed, with prices capped by ample supplies.

Trading volumes were light as investors moved to the sidelines ahead of the year-end holidays. Grain markets will close early on Friday and remain closed through Monday for the Christmas holiday.

Chart-based selling added pressure to a soybean market already slumping from forecasts for beneficial rains in Brazil and Argentina, both large soy producers.

"A lot of the weakness has been because of rain in Argentina, and there is more rain in the forecast this week. But we're really doing some major damage to the charts and that is leading to some technical selling," said Brian Hoops, president of Midwest Market Solutions.

Soybean futures prices climbed above the November high early this month but have since fallen and breached the November low. The bearish technical indicator, known as an outside monthly reversal, is causing traders to square positions or limit long holdings in the market, Hoops said.

Chicago Board of Trade March soybeans fell 3-1/2 cents to $9.58 a bushel by 10:59 a.m. CST (1659 GMT).

Dry conditions and a lack of snow cover in the U.S. Plains wheat belt have put recently planted hard red winter wheat at risk of damage from cold weather, which is expected to strike the region later this week.

Along with the weather worries, signs of improved export demand has lifted wheat prices from recent lows.

U.S. wheat was the cheapest origin grain offered in an Iraqi tender for hard milling wheat.

"We're starting to see U.S. values become more competitive in the world markets," said Brian Basting, analyst with Advance Trading in Bloomington, Illinois.

"But having said that, we're not the only shop in town for wheat, with plenty of competition from the Black Sea and Europe. And they are now harvesting those crops in Argentina and Australia."

CBOT March soft red winter wheat was down 1/2 cent at $4.20 a bushel while March hard red winter wheat gained 3/4 cent to $4.20.

CBOT March corn rose 1/4 cent to $3.47-1/4 a bushel on light short-covering support after last week's contract lows.

(Additional reporting by Michael Hogan in Hamburg and Naveen Thukral in Singapore, editing by David Evans and Tom Brown)