Corn futures on the Chicago Mercantile Exchange (CME) is considered the benchmark for tracking this commodity. Technical analysis of corn futures which fell 1.4 per cent to 746 cents a bushel on September 20 is as follows.
Corn has been on a long-term uptrend ever since taking support at 300 cents a bushel in September 2009. The medium-term trend is also up for corn from its early June 2012 trough at around 551 cents. However, it marked a record high at 843 cents on August 10 and started to lose momentum.
Following a sideways consolidation in the range between 774 cents and 834 cents, the corn tumbled 4 per cent on September 17, breaching the lower boundary at 774 cents. It is hovering well below its 21- and 50-day moving averages. Near-term trend has been down for corn from its record high registered in August. It can prolong its downtrend and test support at 720 cents in the weeks ahead. On the other hand, any corrective rally will encounter resistance at 774 cents and 810 cents. Only a strong jump above the key resistance at 834 cents will take corn northwards to 850 cents.
Medium-term uptrend will remain in place as long as corn trades above the key support band between 660 cents and 670 cents. A strong fall below this band will mitigate its medium-term downtrend and pull the corn down to 620 cents in the medium-term. It has important long-term support at 500 cents and its long-term trend stays up as long as it trades above this base level.
Keywords: Corn Technical