As mentioned in today’s Afternoon Commentary, from a technical point of view it could still be argued July corn is in a minor (short-term) uptrend. Let’s take a look at the contract’s daily chart:
- Tuesday saw July complete a bullish spike reversal, falling to a new low for the move of $4.2925 before closing at $4.3875, up 5.25 cents for the day.
- Yes, open in the contract dropped by 43,230 contracts, a move that looked to be noncommercial short covering .
- If so, then July would be expected to continue to extend its minor uptrend
- Daily stochastics have established a number of bullish crossovers below the oversold level of 20%
- Most recently at the close June 5
- A signal the minor trend was set to turn up
- Wednesday saw July extend its rally to a high of $4.4475 before closing at $4.37, down 1.75 cents for the day
- Technically, this could be viewed as a bearish spike reversal
- But as 5-wave trend patterns go, this could also be viewed as the beginning of a Wave 2 selloff
- Putting support at Tuesday’s low of $4.2925
Traders might’ve bought over the past couple days:
- Possibly near $4.30 based on the idea of corn’s Round Number Reliance
- Or maybe near Tuesday’s close of $4.3875 after the completion of the bullish spike reversal
- Either way, sell stops would be below Tuesday’s low of $4.2925
