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Tech Guy Weekend Comments 4/7/23

Since the beginning of May 2022, December Corn has been in a large A-B-C formation. Before that Dec Corn was marking an upleg from 2020 to May last year.

The corrective pattern also resembles a triangle. The widest part of the triangle is 138 cents.


Currently, December Corn is trading very near long term support between 548 and 540. Notice how the recent lows are very near the lows made after the war began on the left side of the chart.


It appears that corn marked a successful bottom/low on March 23rd. Therefore, the short term trend should be up and the most likely next move will be a rally to the next resistance between 595 and 601.


If the growing season for corn has an actual threat (weather/more war), we can get a higher target/objective. You measure from the top of the triangle on the right at about 590, then you add the 138 cents and that equals about 728 for December Corn. Keep this price in your back pocket.


Here is an 18 month view of the daily December daily corn chart.


November Soybeans has also been in a large corrective wave that resembles a triangle, since April 29th, 2022. The recent low of 1247.50 on March 24th should hold as a solid swing low point.


The week of April 27th, beans rallied 93 cents then corrected last week. Another upleg should be in the cards which has a swing measure target of 1397 if Fridays low of 1303.75 holds. A swing measure target is the length of the first leg of 93 cents added to the bottom or low of the current correction.


The width of the bean triangle is 231 cents. That added to the top right of the triangle near 1415 - again, if the supply becomes more threatened or if the supply/demand ratio becomes small enough to warrant. Check out the November Soybean daily chart.


Interesting observation on the Commitment of Traders report - for soybeans, the noncommercial large traders (funds + managed money) are the least short (fewest traders who have sold) for the last 13 months.


On this weeks report, they were short 30,404 contracts. On March 14th, they were about 39,000 short. On July 5th 2022 (low), they were about 65,000 short. On June 7th 2022 (high), they were about 53,000 short. On Feb 22nd 2022 (near the high), they were about 48,000 short.


Compared to the last 13 months, large traders (funds) are the least interested in being short right now. Why? What do they know?


Here is this weeks CBOT COT report if you are interested: https://www.cftc.gov/dea/futures/deacbtsf.htm




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