July Wheat - 1 Higher
July Corn - Steady to 1 Lower
July Beans - Steady
Remember a few days ago I was talking about simplicity and then gave you some very detailed information yesterday, for those who want to dig into the smaller timeframes. Chart analysis is sometimes a paradox.
We looked for a possible low below 1300 in July Soybeans using ratios of the legs down in this correction and instead, beans rallied 33 cents today. I have something written on the daily chart that wasn't discussed yesterday.
The down move in beans from last June to July was 493 cents on the continuation chart when the July contract rolled to the November. The correction which began recently started from about 1555.
One half of 493 is 246.5. 1555-246.5 = 1308.50. Friday's low was 1304.75. Therefore, the 50% correction is within 4 cents of the bean low. Considering the force of today's rally, Friday is probably the low - within a few cents.
Soybeans could still selloff to 1288, but after today's data, this is less likely. My point is with all the calculations on yesterday's 4 hour bean chart, the simplest calculation (493 divided by 2) on the daily chart is probably closer to our answer to the question - where is the bean low going to be?
Technical analysis is simple yet difficult. A primary rule of reading charts is that the higher timeframe chart takes precedence over the smaller timeframe charts. For example, what the daily chart is telling us is more important than what the 2 or 4 hour chart is saying, unless you are day trading.
Also, the trend could be different from one timeframe to the other. For corn and beans, the weekly chart is in an uptrend while the daily chart has been correcting in a downtrend. It's important to keep this as clear as possible.
With that being said, the intraday charts look to have launched a new uptrend today. Then, after a few day's, if beans are still marking up price, we can say the daily chart is again in an uptrend.
The next move I am looking for in July beans is a correction down to about 1324 from today's high at 1344.25 or a few cents higher. If the fund buyers show up in force near 1324 we will have more confidence the bean low at 1304.75 will hold.
By the way, 1324 is very close to a 50% correction on the 2 hour chart, from today's rally.
Additionally, if today confirms to be the low in July beans, this last leg will be about 50% or half of the previous down leg. These Fibonacci ratios are all over the place, but it takes practice to know best how to utilize and integrate them.
Here is today's 2 hour July Soybean chart and below is a reminder of the daily. I hope you have some time to study the charts.
Notice how the recent down leg from February is about one half of the selloff of last summer.
Either the 647 July Corn low stands or it makes 1 lower low below 647 - we should know in the next 2 day's. Remember the 538 support below. Today's high at 575.5 is first resistance and 600 above is the next resistance.
Support at 560, then 538. Check out today's 4 hour July Corn chart.
July Wheat is treading water around the 600 level at the double bottom. 600, most likely provides a good foundation as KC Wheat turned around (up) at an old gap, today.
I like the triple low forming on July Canola, where the 3rd low should be 690 +/- 5
The Crude Oil traders have rolled to July and I like the spike and ledge pattern continuing to flesh out for a rally to spring. Since May 15th, crude has marked 2 higher lows and 1 lower high.
The ledge is in the form of a converging triangle - support is 71.35 with resistance at 73.40. I don't expect the top number to hold down price for long. Check out the crude chart.
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