SINGAPORE: CBOT July corn may test a support at $4.06-1/4 per bushel, a break below which could cause a loss to $3.99.
The support is identified as the 61.8% retracement on the uptrend from $3.87 to $4.38. The downtrend from $4.38 consists of three waves. The third wave labelled c could be broken down into five smaller waves.
Corn is riding on the fifth wave labelled 5, which is unfolding towards $3.99, as pointed by a falling trendline. Strategically, this target will be confirmed when corn falls below its June 10 low of $4.09.
Resistance is at $4.18-1/2, a break above which could lead to a gain to $4.25-3/4. On the daily chart, a retracement analysis on the uptrend from $3.43 to $4.38 indicates a target at $4.01-1/2, the 38.2% level, as corn has broken the support at $4.15-1/2. Only a rise above $4.24 could signal the continuation of the uptrend.
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** Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.
No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses. **
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