Technically Speaking

Weekly Analysis: Grain Markets

Source: DTN ProphetX

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.35 1/2, up 7 3/4 cents for the week. The secondary (intermediate-term) trend remains sideways-to-down as the NCI.X continues to post a series of lower highs and lower lows. However, it continues to hold above support near $3.29, a price that marks the 67% retracement level of the rally from $2.81 1/2 (week of September 29, 2014) through the high of $4.05 3/4 (week of July 13, 2015). Resistance remains between $3.49 1/2 and $3.59 1/2.

Corn (Old-crop futures): The May contract closed 8.25cts higher at $3.62 1/4. For now the secondary (intermediate-term) trend remains sideways between support at the recent low of $3.47 1/4 and the 4-week high of $3.74. Weekly stochastics are neutral-to-bullish above the oversold level of 20%.

Corn (New-crop futures): The December 2016 contract closed at $3.75, up 5 1/4 cents for the week. Despite the higher close the secondary (intermediate-term) trend remains sideways-to-down. Renewed selling could lead the contract to rejoining its minor (short-term) downtrend resulting in a possible test of its recently established contract low of $3.64.

Soybeans (Cash): The DTN National Soybean Index (NSI.X, national average cash price) closed at $8.59 1/4, down 2 1/2 cents for the week. The inability of the NSI.X to post a new high with weekly stochastics above the overbought level of 80% increases the likelihood of a move to a secondary (intermediate-term) downtrend in the coming weeks. Pressure could continue to come from the commercial side of the market indicated by weaker national average basis and stronger carry in the May-to-July futures spread.

Soybeans (Old-crop futures): The May contract closed at $9.16 3/4, down 1 1/2 cents for the week. While the secondary (intermediate-term) trend remains up, the combination of weekly stochastics above the overbought level of 80% and the lower weekly close increase the market's vulnerability to continued noncommercial selling. If so a bearish crossover could soon be established (weekly stochastics) indicating a downturn in the secondary trend.

Soybeans (New-crop futures): The November 2016 contract closed at $9.30 3/4, down 1 1/2 cents for the week. The secondary (intermediate-term) trend remains up. However, the contract continues to struggle finding buying interest while weekly stochastics sit above the overbought level of 80%. This could lead to increased selling, possibly enough to establish a downturn in the secondary trend.

SRW Wheat (Cash): The DTN SRW Wheat National Index (SR.X, national average cash price) closed at $4.19 1/4, down 18 3/4 cents for the week. Despite the lower weekly close the secondary (intermediate-term) trend is up. Support is now at the new 4-week low of $4.15 3/4 with initial resistance at the recent high of $4.38.

SRW Wheat (New-crop futures): The July 2016 Chicago contract closed at $4.66 3/4, down 16 1/4 cents for the week. The contract posted a bearish outside range last week indicating the secondary (intermediate-term) trend has turned sideways. Support is at the contract low of $4.49 1/2.

HRW Wheat (Cash): The DTN HRW Wheat National Index (HW.X, national average cash price) closed at $4.94 1/4, down 17 3/4 cents for the week. The secondary (intermediate-term) trend is now sideways after the HW.X posted a new 4-week low. Support is at its recent major low of $3.84 1/4.

HRW Wheat (New-crop futures): The July 2016 Kansas City contract closed at $4.70 3/4, down 17 3/4 cents for the week. The secondary (intermediate-term) trend turned sideways. Support is now the recently established contract low of $4.57 1/4.

HRS Wheat (Cash): The DTN HRS Wheat National Index (SW.X, national average cash price) closed at $4.72, down 7 cents for the week. Despite the lower close the secondary (intermediate-term) trend remains up with an initial target of $4.97.

HRS Wheat (New-crop futures): The September 2016 Minneapolis contract closed at $5.39, down 8 cents for the week. The secondary (intermediate-term) trend remains up with next resistance at $5.53 1/2. This price marks the 33% retracement level of the previous downtrend from $6.55 through the contract low of $5.02 3/4. Weekly stochastics are nearing the overbought level of 80%.

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