Corn: next leg up?

[bgold]

After the 209.5 low in July, Corn rallied (drought etc) to a 247 high on 4Sep. The fibonacci 62% correction was sharp filling the Aug and Sep rising windows. Interestingly, the support at rising window on 12 Aug has thusfar held (eg while the window was filled the close was higher than bottom of window).

Time to BUY Corn?

A possible target would be 1.628x the 209.5-247 leg, giving us around 270. Naturally there will be areas of considerable resistance at 232 and 247.

BUY at these levels with stop at last week's low of 221.5? Risking 5 for a potential 50 gain?

I am keen to read other traders' views?

 

[JonnyT]

I'm not convinced. I think its going to fall further...

JonnyT

 

[bgold]

Gut feel or do you see any signals pointing to further weakness? Are/Would you be a SELLER? And where do you see the bottom. July's 209 or Aug 217 or possibly lower?
J

 

[JonnyT]

Broken uptrend in my book.

I would need a close around 229 to think otherwise.

My view is that 210 will be tested in the next few weeks.

Of course this is also historically a weak time for Corn.

JonnyT

 

[ianshep]

J,

I'm a seller. Although it can just about be argued from the weekly continuation chart (below) that we're in an uptrend, the trend for the whole life of the CZ03 contract has been down - lower highs and lower lows. What is going to change that now?

The uptrend line coincides nicely with the contract low for CZ03 so that looks like the figure to target. A close above 230 means I'm officially wrong.

P.S. my trading record in grains is pretty awful!

 

[bgold]

JohnyT and Ianshep,
Thank you both for sharing insights. You were both spot on. My proposed trade would have been stopped out by end of todays' session!! Trend is clearly still down; rising window has been closed, next support at resp 217, 212 and 209.

What do you make of the WZ03 - CZ03 spread? Having peaked in Aug at 2+yr highs of 160, it now trades at 140 (widened by 10 today!)

 

[JonnyT]

Hi Toad,

Sorry but I don't do spreads. Seems kind of pointless to me somehow.

JonnyT