Sep Wheat - 2 to 4 Lower
Dec Corn - 1 to 3 Lower
Sep Beans - Steady to 2 Lower
Nov Beans - Steady
Do you remember some of the things I have said about gaps - mainly that they are unfinished business. Sep Beans had a gap below and one above. The one below was closed at 1469.75 today. The first breakaway gap is still open at 1357.
Here is another simple way to view the charts. If it can't do one thing like gap up on the open, it does the other thing (gap down). If it can't sell off it's probably going to buy up, etc. Now we know the gap underneath Sep Beans was higher priority business - it needed to be taken care of sooner rather than later.
It took me years to understand gaps. Is it good for the trend if they stay open/get closed? I remember reading an article in a futures magazine about the soybean rally (2002) and the guy said, "beans filled the gap underneath and that is good". Why is it good? He said nothing about the health of the trend. Does that mean the trend is dead, I wondered?
The answer is it is good for the up trend because that business underneath will no longer be nagging the market. The Sep Soybeans needed more time to build energy going back and forth. It couldn't fill this gap Friday and the market found itself back in the area today. Taken care of.
Remember Sep Beans took care of the gap above (1554) on August 10th. So now what? Beans have more balanced (also stored) energy and have all the gaps taken care of. By balanced I mean neither the bulls or bears are overbalanced at the moment. Since Aug 10th we've had a 3 down moves and 2 up moves, with a 3rd up move underway.
Since last Wed, Aug 10th (end of an up leg) I believe Sep Beans have completed a triple three correction - a-b-c-x-a-b-c, where each letter is a leg. Also notice how price is kind of balanced on the neckline - blue horizontal line.
December Corn has 2 neck lines in the bottom formation - 1 is trending up, 1 down. It broke up through the 1st one (downtrend) last Thursday morning and ended up testing that line today. It was a successful test which means the market went through it slightly then bounced. In other words the support held.
December Cotton is in a run-a-way up market (2 or 3 limit up days) and made a measuring gap up today. It measures (targets) up to 137.50 which is higher than the May high of 133.79.