July Wheat - Steady
Dec Corn - Steady to 1 Higher
Nov Beans - 6 to 8 Higher
July Corn has now corrected very close to the 50% Fibonacci level, to about 54%. The selling worked today because it caught the most market participants off guard. A very bullish crop condition report so most folks (including me and some funds) are buying and expecting strength - the whales come in to hit more sell stops.
Whales are the biggest of the funds and investors - just a drop in the bucket to sell 50,000-100,000 contracts. What this selling accomplishes is a buildup of more bullish energy - the whales wanted to buy Dec corn below 580 so they can make more money on the way to 775 to 850.
Simple as that. Have you ever heard the saying, "it's all about the money?" The futures markets are unforgiving - folks win, folks loose. At the end of the day, you have to keep your head about you to profit, because the markets are also about greed and fear - raw emotion.
Here is today's December corn daily. If corn needs more selling, the lower triangle line comes in at about 550, 5 cents below today's low. I don't believe 550 will be violated on a close basis, the weather and crop conditions are too bullish.
The Soybean markets are stronger and therefore, didn't sell off as much as corn did today? The August contract didn't even mark a new low for the move today. However, November beans did print a new low by about a dime.
November beans have now retraced about 39%, which is within 1 % of the 38.6% Fibonacci level. The August contract is so strong, it has only sold off to a 15% retracement!
You will see on the November bean chart that some old highs to the left helped with support today. Check it out.
Neither area of support held in July Wheat today, as it sold off to very close to the 680 level which is another support level marked by lines. Today's low is only a 41% retracement in the wheat, so I should have been more open to this.
If today's low does not hold, there is another level at 669. You will see this on the July wheat chart.
Another reason that confidence is high for all the grains to mark new highs with another leg higher is the 2 - legged rule of charts. Markets very rarely move in 1 leg increments, unless the market is caught in a sideways range.
Once you know 1 leg is complete, after a correction, another leg in the same direction is due to happen.
This is from O'Reilly media:
"The market regularly tries to do something twice, and this is why all moves tend to subdivide into two smaller moves. This is true of both with-trend and countertrend moves."