Important Corn Futures Levels & Analysis
The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.
E-mini SP futures have dipped overnight but then showed a strong rally with buyers coming in below our key support level of 1373. Further, Home Depot, the largest U.S. home improvement retailer, rallied 4.7 percent after its profit beat estimates. At this point, we see this market as being oversold below 1373.
The US bond futures are still holding up strong, with the 30yr Bond up slightly for the day at +.27%. Energy markets still are holding a bearish tone with more news of high oil supplies seemingly hitting the market daily. Crude oil futures are down -.44% while heating oil futures are down 1.2%. RBOB gasoline looks to be continuing its recent downward trend, with the JAN13 contract trading down below $2.60 this morning.
We focus our analysis on corn futures today. We first point out that we see a major line in the sand at the $6.70 area. This is the high area of last August, and we believe this will be a very major support level. As indicated, we are seeing corn in a correction from its massive summer rally to above $8. We drew a red trendline to indicate this correction for you. We also see a support level just below $7.20. The last time corn dipped below $7.20 (in Sept. 2012), buyers quickly came in with a 60+ cent rally. We believe that if for some reason corn gets below $7, this will be oversold territory and that buyers might be very excited to buy in at sub-7$ levels.
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