Technically Speaking

Weekly Analysis: Grain Markets

Source: DTN ProphetX

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.50, up 5 cents for the week. The secondary (intermediate-term) trend looks to be sideways-to-up, with the NCI.X needing a move beyond its triple-top near $3.64 to signal a bullish breakout. Weekly stochastics are bullish indicating momentum could continue to build. Retracement resistance is pegged between $3.67 and $3.80, prices that mark the 50% and 67% levels of the previous downtrend from $4.06 through the low of $3.28. National average basis firmed 2 cents last week, with Friday's NCI.X coming in 30 cents below the close of the December futures contract.

Corn (Dec futures): The December contract closed 3.00cts higher at $3.79 3/4. While the minor (short-term) trend is up on the contract's daily chart, the secondary (intermediate-term) trend remains sideways. Support is at the 4-week low (last week's low) of $3.72 while initial trendline resistance is calculated at $3.86 1/2 this week. The 4-week high is up at $3.99 3/4. Support continues to come from commercial buying with the carry in the December to March spread closing at 9 cents Friday, its weakest weekly close since late March 2015.

Soybeans (Cash): The DTN National Soybean Index (NSI.X, national average cash price) closed at $8.40, down 1 cent for the week. Despite the lower weekly close the secondary (intermediate-term) trend remains up based on the previous week's move to a new 4-week high and continued bullish weekly stochastics. Initial resistance is at last week's peak of $8.57, then the previous high of $8.74. National average basis firmed 2 cents last week with the Friday's NSI.X calculated at 55 3/4 cents under the close of the November futures contract.

Soybeans (Futures): The November contract closed 2.75cts lower at $8.95 1/2. Despite the lower weekly close the secondary (intermediate-term) trend remains up, supported by strong buying from commercial and noncommercial traders. Commercial interest is reflected in the strong uptrend (weakening) carry of the November to January futures spread as it traded near par last week. Friday's CFTC Commitments of Traders report showed the noncommercial net-long futures position increased by 1,007 contracts to 64,140. Initial secondary resistance is near $9.42 1/2.

SRW Wheat (Cash): The DTN SRW Wheat National Index (SR.X, national average cash price) closed at $4.40, down 2 cents for the week. While the secondary (intermediate-term) trend is up, the minor (short-term) trend is down. The SR.X is testing support between $4.41 and $4.31, prices that mark the 50% and 67% retracement levels of the rally from $4.11 through the high of $4.71.

HRW Wheat (Cash): The DTN HRW Wheat National Index (HW.X, national average cash price) closed at $4.21, down 7 cents for the week. The secondary (intermediate-term) is sideways while the minor (short-term) trend is down. After the recent test of resistance at $4.62, a price that marks the 23.6% retracement level of the previous downtrend from $6.41 through the low of $4.06, the HW.X has fallen below support at $4.24. This price marks the 67% retracement level of the previous rally from the $4.06 low through the weekly high of $4.60.

HRS Wheat (Cash): The DTN HRS Wheat National Index (SW.X, national average cash price) closed at $4.77, up 2 cents for the week. The secondary (intermediate-term) trend remains up while the minor (short-term) is down. The SW.X is testing support at $4.72, a price that marks the 50% retracement level of the previous rally from $4.44 through the high of $5.01. The 67% retracement level is down at $4.63.

The weekly Commitments of Traders report showed positions held as of Tuesday, October 20.

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