Technically Speaking: Corn | Soybeans | Wheat

Weekly technical analysis of corn, soybeans and wheat

Darin Newsom - DTN Senior Analyst,
May 20, 2018

Corn

Cash: The DTN National Corn Index (NCI, national average cash price) closed at $3.68, up 7 cents for the week. The NCI continues to consolidate below its recent high of $3.72, with weekly stochastics above the overbought level of 80%. Support is at last week’s low of $3.61 with resistance the recent high of $3.72.

Old-crop Futures: The July 2018 contract closed 6.00 cents higher at $4.02 1/2. Despite last week’s higher close, July corn still looks to be in a secondary (intermediate-term) 3-wave downtrend. This could change if the contract takes out the previous high of $4.08 1/4. Initial support is at last week’s low of $3.94 1/4, then $3.90 1/2. The latter marks the 38.2% retracement level of the previous uptrend from $3.62 through the $4.08 1/4 high.

New-crop Futures: The December 2018 contract closed 5.75 cents higher at $4.20 1/4. New-crop December corn still looks to be in a secondary (intermediate-term) downtrend following the bearish reversal on its weekly chart the week of May 7. However, this could be erased by a move to a new high this coming week, with next resistance at the previous high of $4.29 1/2. Weekly stochastics remain above the overbought level of 80%.

Soybeans

Cash: The DTN National Soybean Index (NSI, national average cash price) closed at $9.30, down 3 cents for the week. The NSI remains in a secondary (intermediate-term) 3-wave downtrend, with its weekly close below support at $9.34. This price marks the 38.2% retracement level of the previous uptrend from $8.40 through the high of $9.92. Next support at the 50% retracement level is pegged at $9.16. Weekly stochastics remain bearish after establishing a crossover above the overbought level of 80% the week of March 5, indicating the NSI has more room to extend its downtrend.

Nov Soybeans Wkly

Old-crop Futures: The July contract closed at $9.98 1/2, down 4 3/4 cents for the week. July soybeans remains in a wide-ranging secondary (intermediate-term) sideways trend with boundaries of $9.65 1/4 (low the week of January 8) and $10.90 1/4 (high the week of February 26). Last week’s range established a new 4-week low of $9.92 1/2. However weekly stochastics are nearing the oversold level of 20%, and given the continued sideways trend, could limit new selling interest.

New-crop Futures: The November 2018 contract closed at $10.08 1/4, down 6 cents for the week. November soybeans remain in a secondary (intermediate-term) 3-wave downtrend with the weekly close a test of next support near $10.07 3/4. This price marks the 38.2% retracement level of the previous uptrend from $9.23 1/2 through the high of $10.60. Given the bearishness of weekly stochastics and the contracts 3-wave pattern, Nov beans would be expected to test support between $9.91 3/4 and $9.75 3/4.

SRW Wheat

Cash: The DTN National SRW Wheat Index (SR.X, national average cash price) closed at $4.87, up 20 cents for the week. The SR.X remains in a secondary (intermediate-term) 3-wave downtrend on its weekly close-only chart with last week’s rally looking to be Wave B (second wave).

 SR.X remains in a secondary (intermediate-term) 3-wave downtrend on its weekly close-only chart

Look for subsequent weekly closes to be below the Wave 5 peak, high for the previous uptrend, of $4.94. The most recent secondary signal by weekly stochastics was a bearish crossover above the overbought level of 80% the week of March 5.

New-crop Futures: The Chicago July 2018 contract closed at $5.18 1/4, up 19 1/2 cents for the week. The contract still looks to be in a 3-wave secondary (intermediate-term) downtrend with last week’s rally a potential Wave B (second wave) move. Resistance is at the high of the previous uptrend at $5.38 1/2.

HRW Wheat

Cash: The DTN National HRW Wheat Index (HW.X, national average cash price) closed at $4.99 up 23 cents for the week. Cash HRW wheat remains in a 3-wave secondary (intermediate-term) downtrend on its weekly close-only) chart with last week’s rally looking to be Wave B (second wave). This will be confirmed it the HW.X holds below the previous high weekly close of $5.10, the subsequently moves below the Wave A low of $4.76.

New-crop Futures: The Kansas City July 2018 contract closed at $5.38 3/4, up 20 3/4 cents for the week. Despite the higher weekly close July KC wheat remains in a 3-wave secondary (intermediate-term) downtrend. Last week’s low of $5.20 1/2 was not only a test of support near $5.04 1/2, but also looks to be the Wave A (first wave) low. If so Wave B (second wave) should stay below the high of the previous 5-wave uptrend of $5.68 1/2 (week of April 30). Wave C would be expected to extend below the Wave A low, with next support down at $4.82 1/2.

HRS Wheat

Cash: The DTN HRS Wheat Index (SW.X, national average cash price) closed at $6.18, up 25 cents for the week. The secondary (intermediate-term) trend for cash spring wheat turned up last week with the SW.X posting a new 4-week high weekly close. Next resistance is at $6.26, a price that marks the 38.2% retracement level of the previous downtrend fr4om $7.30 through the low of $5.62. Weekly stochastics are already nearing the overbought level of 80%, possibly limiting new buying interest.

New-Crop Futures: The Minneapolis September 2018 contract closed at $6.33 1/4, up 21 1/2 cents for the week. The contract posted a bullish outside range last week, signaling a strengthening secondary (intermediate-term) uptrend on its weekly chart. Next resistance is at the 4-week high of $6.37, then the previous high of $6.47.

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