SINGAPORE: CBOT December corn may either consolidate further in the range of $3.79-1/4 to $3.85-3/4 per bushel, or break $3.79-1/4 and fall towards $3.73-3/4.
The range is formed by the 23.6 percent and the 7 percent retracements on the uptrend from $3.50-1/4 to $3.88-1/2.
The correction from $3.88-1/2 was triggered by a resistance at $3.89-3/4, the 50 percent retracement on the downtrend from $4.29-1/2 to $3.50-1/4. It looks too shallow to be complete.
However, it is not very clear in which way this correction would extend, as it could last a longer time or develop towards a lower level at $3.73-3/4.
On the daily chart, a bearish engulfing pattern and a shooting star formed on Aug. 1 and Aug 2, both bearish reversal patterns. Together, they strongly indicate a fall towards $3.68-3/4.
Only a break above $3.89-3/4 could confirm the extension of the uptrend towards $3.99.
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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