Technically Speaking

Monthly Analysis: Grain Markets

Source: DTN ProphetX

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.24, down 5 1/4 cents for the month. The major (long-term) trend is sideways with support pegged near $3.23. This price marks the 67% retracement level of the rally from the low of $2.81 1/2 (October 2014) through the high of $4.05 3/4 (July 2016). If this support fails to hold, next support is at the October 2014 low. Monthly stochastics are well below the oversold level of 20%.

Corn (Futures): The May contract closed at $3.51 1/2, down 5 1/2 cents on the monthly chart. The major (long-term) trend remains sideways with support at $3.50 1/4. This price marks the 76.4% retracement level of the rally from the low of $3.18 1/4 (October 2014) through the high of $4.54 1/4 (July 2015). If this support fails to hold, the next level is the October 2014 low that occurred in conjunction with a major bullish reversal. Monthly stochastics continue to slide back toward the oversold level of 20%.

Soybeans (Cash): The DTN National Soybean Index (NSI.X, national average cash price) closed at $8.52 3/4, up 46 3/4 cents for the month. The major (long-term) trend turned up as the NSI.X posted a key bullish reversal during March. After posting a new major low near $8.05, cash soybeans rallied to a high near $8.60 1/4. This left it just short of the December 2015 high of $8.60 1/2. A move beyond that level, likely in early April, would confirm the major uptrend. Monthly stochastics also posted a secondary bullish crossover below the oversold level of 20%, confirming the original that occurred at the end of January 2016.

Soybeans (Futures): The May contract closed at $9.10 3/4, up 49 3/4 cents on the monthly chart. The major (long-term) trend turned up as the May futures contract posted a bullish outside month. May beans posted a high of $9.17, its highest level since October 2015. Monthly stochastics continue to grow more bullish, indicating the uptrend could continue to strengthen.

Wheat (Cash): The DTN National SRW Wheat Index (SR.X, national average cash price) closed at $4.32 3/4, up 26 cents for the month. The SR.X is consolidating above recent lows indicating the major (long-term) trend could soon turn up. Monthly stochastics established a bullish crossover below the oversold level of 20% at the end of March, setting the stage for an upturn. A move above the December 2015 high of $4.48 1/2 would confirm the major trend has turned up.

SRW Wheat (Futures): The May Chicago contract closed at $4.73 1/2, up 20 1/4 cents on the monthly chart. The major (long-term) trend tuned sideways at the end of March as monthly stochastics posted a bullish crossover below the oversold level of 20%. Action by the May futures contract also indicates a possible two-month reversal, though a move beyond the February high of $4.83 would confirm a potential major uptrend.

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