Technically Speaking

Monthly Analysis: Grain Markets

Darin Newsom
By  Darin Newsom , DTN Senior Analyst
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Source: DTN ProphetX

Corn (Cash): The DTN National Corn Index (NCI.X, national average cash price) closed at $3.07 3/4, down 20 cents for the month. The major (long-term) trend remains sideways-to-down. The last three long-term highs have been lower, as have the last two major lows. This would suggest that the August 2016 low of $2.73 is a long-term target.

Corn (Futures): The December contract closed at $3.57 3/4, down 27 cents on the monthly chart. The major (long-term trend remains sideways-to-down. As with cash corn, the last three major highs have been successively lower ($4.54 1/4, $4.39 1/4, $4.17 1/4) while the interim lows ($3.18 1/4, $3.14 3/4) have also been lower. This would suggest a new low could be printed in 2018.

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Soybeans (Cash): The DTN National Soybean Index (NSI.X, national average cash price) closed at $8.82 3/4, down 52 cents for the month. The NSI.X erased many of the bullish technical signals from July as it holds near price support at $8.77 1/2. A decisive break of this level would lead to a retest of the June 2017 low of $8.40, then the major (long-term) low of $8.05 from March 2016.

Soybeans (Futures): The November contract closed at $9.45 1/4, down 62 cents on the monthly chart. It's interesting to note that the downtrend line connecting the major (long-term) highs of $17.89 (September 2012) and $15.36 3/4 (May 2014) continues to hold rallies, this time the July 2017 spike to $10.47. If the June 2017 low of $9.00 1/4 is taken out the futures market could test the November 2015 low of $8.44 1/4.

SRW Wheat (Cash): The DTN National SRW Wheat Index (SR.X, national average cash price) closed at $3.86 1/2, down 58 3/4 cents for the month. Cash SRW wheat posted a new 4-month low of $3.73 3/4 during August, indicating the major (long-term) trend is likely sideways. Next major support is the April 2017 low of $3.63 1/4, then $3.31 3/4 from August 2016.

SRW Wheat (Futures): The December Chicago (SRW) contract closed at $4.34 1/2, down 40 cents for the month. Despite another lower monthly close the market's major (long-term) trend remains up. The December contract was able to close above support at $4.31, a price that marks the 76.4% retracement level of Wave 1 from $3.86 3/4 through the July 2017 high of $5.74 1/2.

To track my thoughts on the markets throughout the day, follow me on Twitter: www.twitter.com\DarinNewsom

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