Last week May 2010 Corn opened at $3.89 and closed the week at $3.75½ which is below the 20 day moving average. Support comes in at $3.71, pivot at 3.79½, and resistance at $3.84. Technically as you will see from the charts below, Stochastics dropped below overbought territory and current ADX numbers are not showing any signs of a strengthening trend either up or down. The dropping divergence in MACD is signaling sideways movement for the near future.
Corn has not been able to recover from the bearish WASDE report that came out on January 12th, Reports of quality problems in US corn have been widespread in recent weeks. Market effects of last year's poor quality crop are not yet fully understood. Livestock feed usage will increase, buy ethanol margins and exports will suffer. The USDA will release the next WASDE report on March 10 and it will include a revision on harvested corn acreage due to last fall's late harvest. We can expect sideways to lower pricing through the month of March into the critical Perspective Planting report released on March 31st. (more)
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