Corn bulls hang tough amid outside market turmoil
December corn futures at the Chicago Board of Trade have backed off from last week's high of $7.18 1/2 a bushel, amid very bearish outside market forces that include big declines in crude oil and stock index futures prices. However, the corn market bulls can argue the corn prices haven't fared too badly given the general sell off seen across the commodity market spectrum.
December corn prices are still in a choppy five-week-old uptrend on the daily bar chart, from the July 1 low of $5.75 1/2 a bushel. However, for the corn market bulls to gain fresh upside near-term technical momentum to suggest a challenge of the contract high of $7.22 3/4, scored in early June, the bulls would have to produce a close above major psychological resistance at the $7.00 level.
The next downside price objective for the corn market bears is to push and close December futures prices below strong near-term chart support at $6.63 1/4 a bushel.
Near-term technical resistance for December corn is located at $6.95 and then at $7.00. Near-term support is seen at Monday's low of $6.80 1/2 and then at $6.75.
The key "outside markets" (U.S. stock indexes, crude oil and the U.S. dollar index) will continue to have a major influence over the corn futures market. If the U.S. stock market continues to sell off, the upside in the corn market and all the grain futures will be seriously limited.
By Jim Wyckoff, contributing to Dow Jones Newswires
(END) Dow Jones Newswires
August 08, 2011 11:40 ET (15:40 GMT)