Technically Speaking

Weekly Analysis: Corn and Soybean Markets

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

Corn (Cash): The DTN National Corn Index (NCI, national average cash price) closed at $3.17 1/4, up 2 cents for the week. Cash corn's secondary (intermediate-term) trend remains up, though nearing a possible bearish rollover. The NCI tested resistance at $3.19 last week, posting a high of $3.19 before falling back slightly. This price marks the 38.2% retracement level of the previous downtrend from $3.57 1/4 through the low of $2.95 1/4. Weekly stochastics are above the overbought level of 80%, nearing a possible bearish crossover that would signal a move to a downtrend.

Corn (Old-crop Futures): The July 2018 contract (analyzed for DTN Strategy purposes) closed 1/4 cent higher at $3.67 1/2. The contract already looks to be losing bullish momentum, indicating a test of the recent low of $3.63 1/4 is likely over the coming weeks. Weekly stochastics remain bullish below the oversold level of 20%, meaning potential pressure is likely to be short-lived. However, the market's major (long-term) trend remains down and could possibly trump neutral-to-bullish secondary signals.

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Corn (New-crop Futures): The December 2018 contract closed 1/2 cent higher at $3.84 1/2. The contract's secondary (intermediate-term) trend looks to be up following the recent 2-week reversal off the low of $3.79 1/4 and bullish crossover by weekly stochastics below the oversold level of 20%. The initial upside target is near $3.91, a price that marks the 23.6% retracement level of the previous downtrend from $4.29 1/2. Support is at the recent low.

Soybeans (Cash): The DTN National Soybean Index (NSI, national average cash price) closed at $8.99, up 13 1/4 cents for the week. The secondary (intermediate-term) trend on cash soybeans' weekly close-only chart still looks to be down. The most recent signal by weekly stochastics was a bearish crossover above the overbought level of 80% the week of December 4.

Soybeans (Old-crop Futures): The May contract (analyzed for DTN Strategy purposes) closed at $9.81 1/2, up 8 1/2 cents for the week. Despite the higher weekly close the May contract remains in a secondary (intermediate-term) downtrend. The recent consolidation pattern looks to be a bearish pennant, putting pattern support this week at $9.74. A bearish breakout would project a downside target of $9.52 1/4.

Soybeans (New-crop Futures): The November 2018 contract closed at $9.85 1/4, up 9 1/2 cents for the week. New-crop November soybeans remains in a secondary (intermediate-term) downtrend following the recent double-top near $10.28 3/4 and subsequent fall to a new 4-week low of $9.70. Next support is near $9.63 1/2, then $9.48 1/4. Weekly stochastics remain bearish above the oversold level of 20%.

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