Technically Speaking

Weekly Analysis: Grain Markets

Source: DTN ProphetX

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.05 3/4, up 6 1/2 cents for the week. The secondary (intermediate-term) trend looks to be at the early phase of Wave 5 with initial resistance at the double-top (weekly close only) slightly below $3.12 1/2. This price marks the 23.6% retracement level of the previous downtrend from $4.00 1/2 through the low of $2.85 1/4. When the NCI.X breaks through this level the next target becomes the area between $3.23 1/2 and $3.29 1/2, the 33% and 38.2% retracement levels. At that time weekly stochastics should be well above the overbought level of 80%, setting the stage for the next downtrend.

Corn (Futures): The December contract closed 5.25cts higher at $3.45 1/2. The contract's secondary (intermediate-term) trend remains up after a rally off a test of support at $3.37. Last week's low was $3.36 1/2. Initial secondary resistance remains at $3.59 1/2, a price that marks the 33% retracement level of the previous downtrend from $4.49 through the low of $3.14 3/4. The 38.2% retracement level is up at $3.66. The minor (short-term) trend on the contract's daily chart is also up following a bullish crossover by daily stochastics last Tuesday. (Note: Next week this analysis will roll to the more active March contract and introduce the new-crop December 2017 contract.)

Soybeans (Cash): The DTN National Soybean Index (NSI.X, national average cash price) closed at $9.20, up 9 cents for the week. While technical indicators continue to show the NSI.X in a secondary (intermediate-term) uptrend, the NSI.X needs move through its previous high weekly close of $9.27 3/4 to confirm. Beyond that initial resistance is pegged near $9.42 3/4, a price that marks the 23.6% retracement level of the previous downtrend from $11.12 through the low of $8.08.

Soybeans (Futures): The January contract closed at $9.86, down 4 3/4 cents for the week. The secondary (intermediate-term) trend remains after the contract was able to rally off support at $9.75. This price marks the 61.8% retracement level of the initial rally from $9.40 1/4 through the high of $10.31. The latter price remains resistance. However, if the uptrend can extend to a new high the next target becomes $10.61, a price that marks the 50% retracement level of the previous downtrend from $11.82 through the $9.40 1/4 low. (Note: Next week's analysis will include an introduction to the new-crop November 2017 contract.)

SRW Wheat (Cash): The DTN National SRW Wheat Index (SR.X, national average cash price) closed at $3.67, up 5 1/4 cents for the week. The secondary (intermediate-term) trend remains up with initial resistance at the recent high (weekly close only) of $3.73 1/4. A move above that level sets the upside target at $4.04 3/4, the 23.6% retracement level of thee previous downtrend from $6.01 1/4 through the low of $3.44. (Note: Next week will introduce analysis of the new-crop July 2017 contract.)

HRW Wheat (Cash): The DTN National HRW Wheat Index (HW.X, national average cash price) closed at $3.12 1/4, up 7 1/4 cents for the week. The secondary (intermediate-term) trend remains up as the HW.X moved beyond its previous high weekly close of $3.11 3/4. An extension of the uptrend could test the next high weekly close of $3.27 1/4 (week of August 15, 2016). Weekly stochastics are bullish below the overbought level of 80%. (Note: Next week will introduce analysis of the new-crop July 2017 contract.)

HRS Wheat (Cash): The DTN HRS Wheat Index (SW.X, national average cash price) closed at $4.82, up 8 1/4 cents for the week. The secondary (intermediate-term) trend is up, with the SW.X above resistance pegged at $4.79. This price marks the 67% retracement level of the previous downtrend from $5.01 through the low of $4.35. Next resistance is at the 76.4% retracement level of $4.85 1/2, though weekly stochastics are already above the overbought level of 80%. (Note: Next week will introduce analysis of the new-crop September 2017 contract.)

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