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 $3.31 1/2, up 3/4 cent for the week. The NCI looks to be nearing the peak of its secondary (intermediate-term) uptrend as it tests resistance at $3.33 1/2 (last week's high was $3.34 3/4). This price marks the 61.8% retracement level of the previous downtrend from $3.57 1/4 through the low of $2.95 1/4. Weekly stochastics are above 93%, indicating the cash market is sharply overbought. The price gap left between the high of $3.20 (week of January 22) and low of $3.27 1/4 (week of January 29) leaves open the possibility of an island reversal over the coming weeks.

Corn (Old-crop Futures): The July 2018 contract (analyzed for DTN Strategy purposes) closed 1/4 cent higher at $3.77 1/2. The contract came within fractions of posting a bearish outside price range last week. Given the higher weekly close its secondary (intermediate-term) trend remains up. However, the contract (corn market in general) is vulnerable to increased selling interest given the establishment of a minor (short-term) downtrend Friday. National average basis versus the July contract continues to firm, calculated at 46 cents under Friday evening. The previous week saw national average basis come in at 46 1/2 cents under.

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Corn (New-crop Futures): The December 2018 contract closed 1/4 cent lower at $3.92 1/4. The contract posted a bearish outside price range last week, indicating it could come under continued pressure. Though it remains in a secondary (intermediate-term) 5-wave uptrend, with last week's high of $3.96 3/4 looking like the peak of Wave 3, its minor (short-term) trend turned down. Initial minor support is between $3.90 and $3.88, then between $3.85 3/4 and $3.83 1/4.

Soybeans (Cash): The DTN National Soybean Index (NSI, national average cash price) closed at $9.14 1/2, up 4 1/2 cents for the week. The NSI continues to show a secondary (intermediate-term) sideways trend on its weekly charts. Resistance is at the 4-week high of $9.31 3/4 with support the 4-week low of $8.99 1/2.

Soybeans (Old-crop Futures): The May contract (analyzed for DTN Strategy purposes) closed at $9.93 1/2, up 3 1/4 cents for the week. The contract remains in a secondary (intermediate-term) sideways trend between $10.16 and $9.55 3/4. National average basis continues to firm with the NSI gaining 1 1/4 cents on May futures, putting basis at 79 cents under. The contract's minor (short-term) trend remains down with support at the recent low of $9.79 1/4.

Soybeans (New-crop Futures): The November 2018 contract closed at $10.00, up 1 cent for the week. The contract remains in a sideways trend between $10.24 (high the week of (December 4) and $9.67 1/2 (low the week of January 8). Its minor (short-term) trend remains down with support at the recent low of $9.89 1/4.

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