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Tech Guy Opening Calls & Comments 4/11/23

May Wheat - 2 to 3 Lower

May Corn - Steady

May Beans - 5 to 6 Lower

The Canola Oil weekly chart made a high last April/May in the 1220 area, then sold off into July to about 780 and then marked a lower low at about 770 in early September. During the selloff, canola gapped down below 1050 - looks like a measuring gap. This gap is unfinished business.

Canola had a retracement rally to about 960 in October. After that, canola traded sideways and lower into mid/late March, printing a low below the 720 level. During the last leg down from 850, Canola made a big gap down near 800.

This most recent gap is probably an exhaustion gap meaning that the sellers have exhausted themselves. However, we will need a weekly close above 800 to confirm the low and exhaustion gap.

Once this confirmation happens, we can estimate targets above for a rally. The width of the bottom formation is about 200 points, not including the last selloff. Again, once the rally begins above 800, we can project a target above at about 1170 - the 970 high + 200 = 1170. There will need to be some fairly serious supply/demand concerns for the 1170 price to be achieved.

Markets love symmetry - this is the reason for the higher 1170 target, but of course this cannot be guaranteed. However, the 1050 target/gap is fairly high probability. We will follow canola on a weekly basis and provide updates. This first win for the bulls will be closing the gap at 800.

The 2nd objective - 1050 - is completing the business of closing the gap below 1050. All of these projections are for July canola, as the November contract is lagging about 57 points now and this spread may widen to 100 points later on.

Check out the weekly canola bar chart and study these prices on the left and right side of the chart and see if you can envision what I am talking about.

Chicago May Wheat marked a third lower low in the 670 support area today. It looks like it may be finished fleshing out the right shoulder of the inverted head & shoulders pattern. 666 is support.

Now, we will see if the wheat bulls can attempt a rally towards the neckline, which is above the 724 swing high. Therefore the upper price targets are 724 first, then about 740 and finally the 810 level.

Patterns take their time developing, so patience is the most valuable commodity. Chicago wheat will probably continue to lag KC wheat, therefore we will be watching both markets as they unfold. As the buyers come in, Chicago may gain on KC because that is where the funds are most interested in playing - greater liquidity. Here is the updated 4 hour May Chi - wheat chart.

The 649 support held up on a closing basis in May Corn today. The rest of the week should see the bulls make an attempt to rally toward 668, then 680. Support for tomorrow is near today's low at 647.

May Soybeans managed a close very near the 1498 pivot level - up +10.25 cents on the day at 1497.5. Support is 1487 and resistance is 1508 and higher at 1527.

Remember that upper price targets and resistance are really one and the same - simply different words to describe.

Also, I only recently discovered that at the very bottom of the page, below the commentary and recent posts, is a comment/question section for you. If you scroll all the way down to the low of the report page you will see it. Feel free to comment, ask a question or criticize. Thanks and I will attempt to respond.