December Corn Futures Posted a New Low for the Year
The technical condition of the July futures contract remains cautiously positive even though the market failed to crack the 40 day moving average area of 6.35. If this resistance area is broken a move to the 6.50-6.60 is probable. On the downside, obvious strong support is in the 5.91-94 area.
December corn futures posted a new low for the year this past week and broke trendline support in the process. The good news is that prices rebounded well off the lows and closed back above the trendline support zone. Near term resistance is now at 5.32 with secondary resistance at 5.50 The next support zone exists in the 5.00 to 5.05 area.
After making a new contract high this week at 15.125, the market then posted a technical reversal lower and experienced mild downside follow through. Several technical indicators are in the beginning stages of negativity developing. This will be the third time in the past two months that a price correction will have attempted to unfold. The previous two price corrections were challenged by the market bulls and new highs unfolded. Currently, values remain above the key moving averages and the major trendline. If prices begin to pierce these support levels between $14.17-14.60 it will give the bearish crowd the edge.
November soybean futures pierced the support trendline this past week but bounced back up. A couple of technical points at 13.46 offer support below the market then the 13.32 area remains a major secondary support zone and a move below there is technically bearish. Otherwise, upside resistance remains very strong at the $14 mark.
Prompted by the previous weeks positive activity, July futures tried three straight days of trying to crack the 6.55 area and failed. It was all downhill after that as the funds actively drove the prices to a new contract low of 5.995 on Friday. A move back above 6.22 would be beneficial to help stabilize this market. Otherwise, the next support zones are at 5.90 then 5.68.