SINGAPORE: CBOT May corn first month is expected to test resistance at $3.98-1/2 per bushel in the second quarter, a break above which could lead to a rise to $4.29-3/4.
The resistance is provided by the 61.8 percent projection level of an upward wave (c) from $3.29-3/4. This wave is capable of travelling into a wide range of $3.98-1/2 to $4.41.
The downtrend from 2012 high of $8.43-3/4 could have been completed at the 2016 low of $3.01, as suggested by its five-wave structure and an inverted head-and-shoulders.
The neckline of the pattern is around $3.98-1/2, a break above this level could confirm both the pattern and a target around $5.87-3/4.
The contract could be riding on a medium-term to long-term bull cycle, which has completed its first phase at the July 2018 low of $3.29-3/4. The second phase is developing, driven by a powerful wave 3.
This wave has a fierce character. It may quickly travel to $4.29-3/4, the 61.8 percent retracement of uptrend from the 2000 low of $1.74 to $8.43-3/4.
Support is at $3.56, a break below which could cause a loss limited to $3.32.
* Charts are not available in reports received in email box through "Alert". To get charts, use the news code of to retrieve the original reports.
** 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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