Tech Guy Opening Calls & Comments 1/18/23
March Wheat - Steady to 1 Higher
March Corn - Steady
March Beans - Steady to 1 Lower
March Corn showed the most strength today during this little corrective move, trading down about 4 cents to 680.25. The selling stopped just shy of an old high to the left which provides support now.
Today's support line is an old high from November 15th at 677. It is also the point where the neckline originates. I will be surprised if corn doesn't trade back up to the neckline this week. Check out the updated March Corn chart, noting the support line I'm referring to.
The selling in March Soybeans today fell through the 1528 support line where the old gap is and continued down until the price of 1511. This is a somewhat odd area to find support, but a closer look reveals a bump to the left that had to be tested. Sometimes the fund buyers come into the market in between support levels.
Remember, bull markets have to do what they have to in order to have enough energy to continue the trend. Today, the selling target was the last swing point low before beans printed their high price yesterday. I expect the buying to continue. Here is today's 2 hour chart.
The daily soybean continuation chart reveals that support came in today just a few ticks above the top of the ascending triangle.
The new crop (Nov 23) soybean chart has been consolidating in a sideways channel, and building energy since August 23rd. I expect this contract will eventually make new highs into the spring before any substantial selloff correction occurs. Here is a daily Nov 23 chart with resistance and support lines drawn.
The soybean board remained inverted during today's selloff. In other words, May lost more that March, May lost more price than July, and the August contract lost more July. This tells me that near term demand did not wane during today's corrective move.
March Wheat fell about 1.5 cents through my 742 support level but remained above an uptrend line just below at 736. You will see on the chart that wheat traded above the old 758 high to the left yesterday and corrected down from there.
Markets have to generate energy periodically. Corrections in a trend are a healthy thing. It provides more balance and stability. Markets that scream straight up usually come straight back down all the way from the takeoff point. Stable markets stairstep. March Wheat has been methodically building a base of price which will enable higher prices.
The next target higher is 799. Check out the updated 1 hour March Wheat chart with 2 new lines drawn - a blue uptrend line and a red horizontal line across a swing high that painted right after wheat bottomed out - the threat of this second line being tested seemed to get the fund buyers going again.
The Crude Oil market rolled to the March contract today. This is when the fund money gets out of February then gets into March - both longs and shorts. Basically, crude's trade revolved around the neckline today moving about 2 dollars above early in the session then selling off about a dollar below.
The next move could very well be to test the 78 support to the downside. In general, when a market trades to the neckline of a head & shoulders it has reached a supply/demand balance point so that it becomes a moment of truth for the buyers in this case of crude oil. Will they commit to further price markup.
Sometimes markets need a couple of days to recharge. Between today's close and 78 the fund buyers will most likely take charge again and then the upper target of about 89 comes into play. I will expect a larger correction when March Crude Oil reaches this 89-90 objective. Here is today's chart.
