CORN:
First Notice: Sep: 31Aug; Dec: 30Nov
18July Early slaughter and a drop in ethanol output is evidence of rationing of demand. The market has dropped in early trading for the 2nd day in a row.
Traders looking for a consolidating correction should be on the lookout for signs that the farming community is starting to put hedges on as they come to terms with their actual crop size.
December
Support: 7.60: Projected measured move. 6/15 to 6/27-6/29 pause, then 1.27 move from 6/29.
7.50: Psychological level
7:08:7/5 settlement, 7/9 opening
7.00: psychological level
6.85-6.90: support above gap since 7/5 gap open.
6.73: Aug 2011 highs
6.56 ¾: 6/26 high trade
6.45: June 2011 highs
6.17 Oct 2011 highs
5.94: Gap left on 26June opening.
5.75: March high trades, support in early January, bullish support inflection level back to 7/1/2011 low.
5.69: Previous high and gap left on 25June opening.
Resistance: 7.78: 7/16 high trade
7.90: Just above the 7/17 high
8.00: Psychological resistance level
8.12½: +2 STD over the 21-day moving average (6.67½)
Comment: Technicals remain clearly positive in primary directional indicators. The topping action we identified last week seems to have resumed.
Watch our noted gap levels as these getting filled may give the market the structure necessary to head to new highs.
Gaps remain in place between 6.74½ and 6.85½. Additional technical gaps remain between 5.94 and 5.96¼, between 5.54 and 5.70, and then well below the consolidation between 5.34 and 5.36 ¼.
Seasonal Snapshot: For December-All 3 patterns have a modest positive bias until 7/14, when all 3 peak and head lower until starting bottoming action on 7/22. The 5 and 15-year patterns bottom on 7/25, the 30-year on 7/30. At their bottoms, all 3 will project modestly higher biases until 8/2.