Technically Speaking

Monthly Analysis: Grain Markets

Source: DTN ProphetX

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.35 1/4, up 10 1/4 cents for the month. The major (long-term) trend of the NCI.X remains difficult to classify. The best description could be a long-term sideways trend between the low of $2.81 1/2 (October 2014) and $4.10, a price that marks the 23.6% retracement level of the previous downtrend from $8.26 1/4 (August 2012). The NCI.X continues to sit near the midpoint of its range at $3.39 1/2.

Corn (Futures): The July contract closed at $3.72, up 5 1/2 cents on the monthly chart. Similar to the NCI.X (see above), the major (long-term) trend of corn futures is still classified as sideways with support at the low of $3.18 1/4 (October 2015) and resistance at $4.43 1/2. The latter price marks the 23.6% retracement level of the previous major downtrend from the high of $8.49 ((August 2012). Also as with the NCI.X, corn futures continue to hold near the midpoint of the sideways range at $3.82 1/2.

Soybeans (Cash): The DTN National Soybean Index (NSI.X, national average cash price) closed at $8.50 1/4, down 28 1/4 cents for the month. The NSI.X is another complicated market with its monthly chart continuing to show a number of conflicting signals regarding the major (long-term) trend. The NSI.X posted a bearish outside month in May, indicating the cash market could fall back to test its long-term low of $8.05 from March 2016.

Soybeans (Futures): The July contract closed at $9.16, down 40 1/4 cents on the monthly chart. The futures market posted a bearish outside month during May, indicating the market could test its major low of $8.44 1/4 from November 2015.

HRW Wheat (Cash): The DTN National HRW Wheat Index (HW.X, national average cash price) closed at $3.54 3/4, up 13 cents for the month. While indications are the HW.X remains in a major (long-term) 5-wave uptrend, activity the last three months shows a consolidation pattern. Support is at the April low of $3.13 3/4 with resistance at the March and May highs of $3.78 1/2 and $3.78 1/4 respectively. Monthly stochastics are still bullish, above the oversold level of 20% yet well below the overbought level of 80%.

HRW Wheat (Futures): The July Kansas City contract closed at $4.31 3/4, down 5 1/2 cents for the month. While the major (long-term) trend still looks to be up, similar to HW.X the futures market is in a consolidation phase between support at $4.02 1/4 and resistance at the 4-month high of $4.75.

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