The monthly chart for the cmdty National Corn Price Index (NCPI, weighted national average cash price) could be the key to the entire grain and oilseed complex. Corn remains King of the Complex, with the NCPI the heart, or intrinsic value of the King. And like so many others, the NCPI posted a bearish spike reversal during May, confirming its major (long-term) trend has turned down. This move coincided with another bearish crossover by monthly stochastics above the overbought level of 80%. The NCPI posted a May high of $7.4931 before falling to a low of $6.1857 and closing at $6.7121. This was down 18.17 cents for the month, completing the spike reversal, but also well off its monthly low. The latter is a result of continued strong demand for old-crop cash corn supplies, indicated by national average basis holding well above its previous 5-year highs the cmdty National Corn Basis Index was calculated at 14.5 cents over July futures last Friday. The previous 5-year high for the last week of May was 25.5 cents under, of a difference of roughly 40 cents. The 2020-2021 marketing year still has a full quarter remaining, so it would not be surprising to see the NCPI consolidate before extending its new major downtrend, unless basis starts to crack before the fourth quarter is through.
