Technically Speaking

Weekly Analysis: Grain Markets

Source: DTN ProphetX

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.17 1/2, up 14 1/4 cents for the week. The secondary (intermediate-term) trend remains up. However, with weekly stochastics moving above the overbought level of 80% last week additional upside could be limited. Next resistance is between $3.23 1/2 and $3.29 1/4, prices that mark the 33% and 38.2% retracement levels of the previous secondary downtrend from $4.00 1/2 through the low of $2.85 1/4. Seasonally the market tends to post an initial peak (weekly close only) the third close of December, or this coming Friday.

Corn (Old-crop Futures): The March contract closed 12.25cts higher at $3.59 1/2. Despite its recent consolidation the secondary (intermediate-term) trend remains up. Weekly stochastics turned bullish again at the end of last week indicating the contract could make another run at initial resistance near $3.67 3/4. This price marks the 33% retracement level of the previous secondary downtrend from $4.53 1/4 through the low of $3.25. The 50% retracement level is up near $3.89.

Corn (New-crop Futures): The December 2017 contract closed 10.75cts higher at $3.88 1/2. The contract's secondary (intermediate-term) trend remains up with initial resistance near $3.90 3/4. This price marks the 50% retracement level of the previous downtrend from $4.22 3/4 through the low of $3.58 1/2. The 61.8% retracement level is up at $3.98 1/4. Weekly stochastics are bullish and still below the overbought level of 80% indicating the contract may have more upside momentum.

Soybeans (Cash): The DTN National Soybean Index (NSI.X, national average cash price) closed at $9.66, up 10 cents for the week. The secondary (intermediate-term) trend is up with the NSI.X testing resistance near $9.75 1/4. This price marks the 38.2% retracement level of the previous downtrend (weekly close only) from $11.12 through the low of $8.08. Weekly stochastics remain bullish but nearing the overbought level of 80%. This would indicate a possible retest of initial resistance, with a decreasing chance of extending its uptrend to the 50% retracement level of $10.01 1/4.

Soybeans (Old-crop Futures): The January contract closed at $10.37 1/2, up 10 cents for the week. The secondary (intermediate-term) trend remains up, though the contract has failed the last two weeks to hold spikes beyond next resistance near $10.61 1/4. This price marks the 50% retracement level of the previous secondary (intermediate-term) from $11.82 through the low of $9.40 1/4. With the downtrend (stronger carry) in the January-to-March spread strengthening and weekly stochastics near the overbought level of 80% it could be difficult for the market to extend its rally beyond the 50% retracement level.

Soybeans (New-crop Futures): The November 2017 contract closed at $10.25, up 10 cents for the week. The secondary (intermediate-term) uptrend looks to be nearing its end as weekly stochastics approach a bearish crossover above the overbought level of 80%. Upside resistance remains between $10.38 1/2 and $10.52 3/4, prices that mark the 61.8% and 67% retracement levels of the previous secondary downtrend from $11.50 1/2 through the low of $8.57. Seasonally the contract tends to post an initial high on its weekly close only chart this coming Friday before trending lower through early February.

SRW Wheat (Cash): The DTN National SRW Wheat Index (SR.X, national average cash price) closed at $3.65 1/2, up 14 cents for the week. The market's weekly close only chart shows its secondary (intermediate-term) trend to still be up. With weekly stochastics growing more bullish the SR.X could push through initial resistance at its previous high weekly close near $3.73 1/4, setting its sights on the next high weekly close of $3.92 3/4.

SRW Wheat (New-crop Futures): The Chicago July 2017 contract closed at $4.38 1/2, up 7 1/2 cents for the week. Despite the higher close the contract's weekly close only chart continues to show a secondary (intermediate-term) downtrend. Initial support is at the low weekly close of $4.31 (week of November 28).

HRW Wheat (Cash): The DTN National HRW Wheat Index (HW.X, national average cash price) closed at $3.06 3/4, up 6 3/4 cents for the week. The market's secondary (intermediate-term) trend remains sideways-to-up on its weekly close only chart. Initial resistance is at the double-top between $3.11 3/4 (week of October 17) and $3.12 1/4 (week of November 14), though the fact the latter was higher than the former would suggest a bullish breakout over the coming weeks. Also, weekly stochastics are bullish indicating a possible test of the next high weekly close of $3.27 1/4.

HRW Wheat (New-crop Futures): The Kansas City July 2017 contract closed at $4.37 1/2, up 5 cents for the week. Despite the higher weekly close the secondary (intermediate-term) trend looks to be down after the contract posted a new low of $4.23 1/2 last week. Weekly stochastics turned bearish again above the oversold level of 20%.

HRS Wheat (Cash): The DTN HRS Wheat Index (SW.X, national average cash price) closed at $4.95 1/2, down 3/4 cent for the week. The secondary (intermediate-term) uptrend looks to be nearing its end with the SW.X just short of a full retracement of the previous secondary downtrend from $5.01 through the low of $4.35. Weekly stochastics are above 90% indicating a sharply overbought situation, likely leading to a bearish crossover during the weeks ahead.

HRS Wheat (New-crop Futures): The Minneapolis September 2017 contract closed at $5.36, down 7 cents for the week. The secondary (intermediate-term) uptrend could soon come to an end with weekly stochastics above the overbought level of 80%. However, the contract could look at a retest of its recent high of $5.50 1/4 before its secondary trend turns down.

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