Corn belt dryness update:
The previous 30 days of precipitation as a percentage of average has not improved since last week, from my view. The area with 25% or less than normal rain spans many millions of acres from Minnesota and Wisconsin down through the western part of Iowa, a big chunk of Illinois, the east side of Missouri, and the western/northern part of Indiana.
Ohio did appear to improve somewhat, as did the central part of Iowa. I was also looking at the drought monitor website. A particular drought map that I found alarming was the prognosis of persistent drought through September 30th, from the US Seasonal Drought Outlook.
A huge area - pretty much the same places with 25% or less rain in the last 30 days, is forecast to remain in drought throughout the end of the growing season. Here is that map from the drought website.
This is the drought webpage: https://droughtmonitor.unl.edu/ConditionsOutlooks/Outlooks.aspx
Here is the updated water weather website showing 7, 14, 30, 60 etc. days of previous rainfall: https://water.weather.gov/precip/
All the grains had historic rallies last week. Corn, soybeans and wheat pierced up through several resistance areas. Also noteworthy, all 3 grains should have completed up impulses and are due for some sort of consolidation or pullback. However, this weather market could produce anything on Monday night.
July wheat worked itself up through 3 resistance lines, as you will see on the 8 hour July wheat chart. Support is anywhere from 670 to 649, and nearterm upside projections are 725, then 800. See what you think.
December corn also got bought up through 3 resistance lines, including breaking out of the top of the big triangle that it had previously sold out of to the downside. Support is about 577 and the next target higher is 637 - top of the B wave. After that, the May '22 high of 679 comes into play.
Check out the current December corn chart.
On Thursday and Friday's trading sessions, November Beans broke up through 2 resistance areas and touched a 3rd one at Friday's high. Again, anything can happen in these conditions, but a technical backfill is due because of the nature of the 5 Elliot waves that have been completed.
If Tuesday brings out the sellers, Thursday's high of 1295 would be strong fund buying support. In strong weather markets, pullbacks are guaranteed, but knowing exactly when they will occur is the trick.
Something else - the greed of the funds causes them to engineer the market lower so they can buy at lower prices - simple as that. They determine when this will happen. It is usually after the last feverish retail buyers pile on, then the funds stop them out with sell orders so they can buy lower.
Most likely, Friday was that pile on day, so we shall see. Bigger picture in beans, Friday completed leg 1 (217 cents) of a 5 wave upthrust. Therefore, we have at least 2 (maybe more) up legs of this magnitude in front of us, with corrections in between. Check out November Soybeans so you can see where these lines are.
The August soybean 4 hour chart breaks down a few more details for you. There are 5 clear waves marked with 2 small corrections in between. You will see the lengths of the 3 up legs and the total length of all 3.
The 5 legs went like this - first one was 80 cents (1), then 78 (wave3), then the last one extended, and it was 104 (5). The total length of this leg is 220 cents in 12 days - an historic rally. I am expecting/hoping for a pullback to the lower blue line between 1368 and 1362, which was near Thursday's high. Here is a breakdown of August beans.
A big however: If all or some of the grains are too strong on Monday night's open, then they will gap up and create a measuring gap. These can occur anytime in a weather market usually on Sunday night or Monday night after the crop conditions are published. Furthermore, a gap could be a midpoint gap or a one third gap - this means the rally would be half over in price or only one third complete in length.
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