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Bears press corn, wheat downward

02/24/2014 @ 7:55am

May CBOT corn futures slid slightly lower Friday, pressured in part by positioning ahead of options expiration. Nonetheless, May corn posted gains on the weekly chart, as the market hit its highest level since late October during the week.

The near-term technical trend is bullish, but May corn is testing an old resistance zone at $4.58 1/2, the Nov. 12 swing high. Daily momentum is threatening a bearish turn from overbought levels, which could usher in a minor period of consolidation or downside correction.

If the bulls regain control of the market early in the week, the $4.68 1/2 zone will act as a bullish objective, the mid October swing high. Beyond there, $4.82 is a key chart point from Sept. 30.

On the downside, Friday's low at $4.56 1/4 offers initial support. Below there, additional layers of support are seen at $4.54 1/2 and then $4.50 1/2. The near term trend is bullish, but some backing and filling action could be seen early in the week.

$6.76 1/2 -- the contract high

$4.52 1/2 - -the 10-day moving average

$4.46 3/4 - the 20-day moving average

$4.40 1/4 -- the 40-day moving average

$4.14 1/2 -- the contract low

MAY CBOT WHEAT, combined pit and electronic trading

May CBOT wheat tumbled to a lower close Friday. The contract still posted gains on the weekly chart. For now, the bulls are being stymied by resistance at the $6.17 3/4 zone, the Jan. 6 swing high and that is the zone the market would need to conquer to unleash a fresh upwave of price action. The near term trend is bullish and a "V" bottom pattern is seen on the daily chart. But, daily momentum indicators are showing signs of weakness and a modest consolidation or correction period could be seen short-term. Support lies at $5.96 1/2-$5.95 1/4. The longer term trend remains bearish.

$8.98 --the contract high

$5.96 3/4 -- the 10-day moving average

$5.83 3/4 -- the 20-day moving average

$5.88 1/4 -- the 40-day moving average

$5.53 1/2 -- the contract low

MAY KC WHEAT, combined pit and electronic trading

May Kansas wheat closed lower, etching a bearish outside day on the daily chart. That marks $6.85 1/2 as key nearby resistance. The near term trend is bullish, but vulnerable to correction. Gains through $6.85 1/2 would show the bulls have regained control, with the next target at $7.00 1/4. Minor supports are seen at $6.74 1/2 and then $6.66 3/4.

$9.40 - - the contract high

$6.64 3/4 -- the 10-day moving average

$6.43 1/2 -- the 20-day moving average

$6.38 1/2 -- the 40-day moving average

$6.05 -- the contract low

-Write to Kira Brecht at copydesk@dowjones.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

(END) Dow Jones Newswires

February 24, 2014 08:00 ET (13:00 GMT)

DJ Bears Press Corn, Wheat Lower -- Technical Analysis->copyright

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