August 12, 2009
Corn bears still in full technical command
Chicago Board of Trade corn futures on Monday (August 10) saw a tepid short-covering bounce in a bear market and also some position evening ahead of Wednesday's key US Department of Agriculture crop production report.
However, the bears remain in full near-term technical control of the corn market.
The surge in prices in late July pushed December corn futures to a fresh four-week high of US$3.76 a bushel. That price level was a key 38 percent Fibonacci retracement level of the price move from the May high of US$4.73 1/2 to the contract low of US$3.14 3/4, scored in late July. December corn futures hit the key Fibonacci resistance level and promptly backed way off.
For the corn market bulls to begin to regain some fresh upside near-term technical momentum to begin to suggest that a major market low is in place, they will have to produce multiple closes above solid technical resistance at US$3.50 a bushel, basis December futures.
A close below solid chart support at the contract low of US$3.14 3/4 would produce more serious technical damage to then suggest a challenge of major psychological support at US$3.00 a bushel or below.
