Corn Tech Update
Grain Market Commentary
Wednesday, July 11, 2018
by Jacob Christy, Freedom Program Trader
The abysmal price action continues for corn as Dec18 futures plunge to new contract lows today. Ideas of record breaking U.S. yields and fear over the U.S./Chinese trade war have pressured the corn market to its lowest level in 11 months. Prices have fallen in 22 of the last 30 sessions on a steep slide going back to memorial day. Until either the trade war rhetoric or weather changes, bears look to remain in control.
Looking at the chart shows a clear downward trend. The market rejected last Friday’s upside reversal and has slipped to new contract lows in growing volume. Not good signs. A Fibonacci extension off the early 2018 rally puts a downside objective at 349 ¼, with continuation support below there at 336. To the upside the first target is to clear the short term descending trend lines off the late June/ Early July highs. 380 will be a key swing point to extend any recovery.
Obviously the market is under immense pressure. Funds are now short and the market is deeply oversold indicating new sellers may become harder to entice. With that said, there’s nothing bullish about contract low closes and the market will need to string together some positive sessions before the recently established short gets nervous. We’ll see how much bearishness is priced in, or if further downside still exists.