Technically Speaking
Darin Newsom DTN Senior Analyst

Monday 03/31/14

Ag Markets: Monthly Analysis

Corn: The nearby contract closed 44.50cts higher. The major (long-term) trend has turned up. The bullish crossover by monthly stochastics in March confirms the rounded-bottom formation on the monthly chart. The initial price target is near $5.52, a price that marks the 33% retracement level of the previous downtrend from $8.43 3/4 (August 2012) through the low of $4.06 1/4 (January 2014). The 50% retracement level is at $6.25.

Soybeans: The nearby contract closed 50.00cts higher. The major (long-term) trend remains up. The nearby May contract is testing resistance at $14.75 3/4, a price that marks the 50% retracement level of the previous downtrend from $17.89 (September 2012) through the low of $11.62 1/2 (August 2013). It should be noted that this low was part of a key bullish reversal that turned the long-term trend up. Given the bullish commercial outlook indicated by the strong inverse in the nearby futures spread (May to July) the market could test the 61.8% retracement level near $15.49 3/4.

Wheat: The nearby Chicago contract closed 98.25cts higher. The major (long-term) trend has turned up. The nearby May contract is testing resistance near $7.02, a price that marks the 38.2% retracement level of the previous downtrend from $9.47 1/4 (July 2012) through the low of $5.50 1/4 (January 2014). The 50% retracement level is up at $7.48 3/4. Monthly stochastics remain bullish.

Cotton: The spot-month contract closed 6.93cts higher. The major (long-term) trend is up. The initial price target is 119.20, a price that marks the 33% retracement level of the downtrend from 227.00 (March 2011) through the low of 66.10 (June 2012). Monthly stochastics remain bullish and well below the overbought level of 80%.

Live Cattle: The nearby contract closed 7.400 lower. The major (long-term) trend appears to have turned down. The nearby April contract posted a bearish key reversal on the monthly chart, closing below the February low of $138.60 after posting a new high of $148.825 earlier in the month. Monthly stochastics confirm this move to a downtrend with a bearish crossover above the overbought level of 80%. The initial downside target is near $121.30, a price that marks the 38.2% retracement level of the previous uptrend from $79.975 (March 2009) through the March 2014 high.

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Commodity trading is very complicated and the risk of loss is substantial. The author does not engage in any commodity trading activity for his own account or for others. The information provided is general, and is NOT a substitute for your own independent business judgment or the advice of a registered Commodity Trading Adviser.

Posted at 3:00PM CDT 03/31/14 by Darin Newsom
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