Technically Speaking

Weekly Analysis: Grain Markets

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.61, down 25 cents for the week. The NCI.X followed the previous week's bearish reversal with a bearish gap lower. However, weekly stochastics indicate the secondary (intermediate-term) trend is sideways-to-down rather than down, meaning support could emerge near $3.55. This price marks the 67% retracement level of the rally from $3.29 through the recent high of $4.06. Cash corn's major (long-term) trend remains up.

Corn (Old-crop): The September contract closed 27.75cts lower at $3.92 1/2. The sharp sell-off the last two weeks has led to a bearish crossover by weekly stochastics below the overbought level of 80%. This would indicate the secondary (intermediate-term) trend has turned sideways, with the last secondary crossover still bullish (week of June 1). Next support is pegged near $3.82 1/2, a price that marks the 67% retracement level of the rally from $3.52 (week of June 15) to $4.43 1/4 (week of July 13).

Corn (New-crop): The December contract closed 28.50cts lower at $4.02. The sharp sell-off seen the last two weeks established a bearish crossover by weekly stochastics below the overbought level of 80%. This would indicate the secondary (intermediate-term) trend has turned sideways with next support near $3.93, the 67% retracement level of the rally from $3.62 1/2 (week of June 15) to $4.54 1/4 (week of July 13). Volume and open interest continue to decrease, additional signals that the contract is in a consolidation phase rather than a change of trend. The corn market in general remains in Wave 3 of a major (long-term) 5-wave uptrend.

Soybeans (Cash): The DTN National Soybean Index (NSI.X, national average cash price) closed at $9.53, down 21 cents for the week. The secondary (intermediate-term) trend remains sideways with initial resistance at the 4-week high of $10.12 and initial support near $9.50. Weekly stochastics are neutral, though the last secondary crossover was bullish below the oversold level of 20% (week of June 1). Despite the sell-off in July NSI.X remains in Wave 3 of a major (long-term) 5-wave uptrend given the move above the Wave 1 peak of $10.08 (November 2014).

Soybeans (old-crop): The August contract closed 23.50cts lower at $9.91 1/4 last week. Weekly stochastics established a bearish crossover below the overbought level of 80%, indicating the contract is moved into a secondary (intermediate-term) sideways trend. Initial support is at $9.82, a price that marks the 50% retracement level of the rally from $9.09 1/2 to $10.54 3/4. Next support is at the 67% retracement level of $9.57 1/2. The contract moves into delivery at the end of July, with cash bids moving to the November contract.

Soybeans (new-crop): The November contract closed 41.75cts lower at $9.65 last week. The secondary (intermediate-term) trend has turned sideways with weekly stochastics establishing a bearish crossover below the overbought level of 80%. Nov beans closed below support near $9.70 1/2, a price that marks the 50% retracement level of the rally from the low of $8.95 3/4 (week of June 15) to $10.45 (week of July 13). Next support is the 67% retracement level near $9.45 1/2. The soybean market in general remains in a major (long-term) sideways trend on its weekly chart, unable to move into Wave 3 of its 5-wave uptrend so far.

Wheat (SRW Cash): The DTN National SRW Wheat Index (SR.X, national average cash price) closed at $4.53, down 45 cents for the week. There are no conclusive secondary (intermediate-term) trend signals on the weekly chart. Nevertheless the SR.X looks to be moving toward a test of its previous low of $4.38. The major (long-term) trend is sideways.

Wheat (HRW Cash): The DTN National HRW Wheat Index (HW.X, national average cash price) closed at $4.62, down 40 cents for the week. The sharp sell-off of the last three week has the HW.X in position to test its previous low of $4.49. The major (long-term) trend remains sideways.

Wheat (HRS Cash): The DTN National HRS Wheat Index (SW.X, national average cash price) closed at $4.93, down 30 cents for the week. Cash HRS moved to a new low 5-year low last week, keeping both the secondary (intermediate-term) and major (long-term) trends sideways-to-down. Next support could be found between $4.72 (low from June 2010) and $4.45 (low from September 2009).

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