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    Technical Analysis #C-CORN : 2015-03-10

    Ahead of USDA report

    Today we would like to focus your attention to the CORN on the H4 chart. The monthly World Agricultural Supply and Demand Estimates (WASDE) report will be released by USDA today at 17:15 CET. The outlook for grain volume intended for ethanol production was unexpectedly raised by 75 million bushels in the previous report. At the same time, the outlook for corn stockpile by the end of the 2014/2015 season was reduced by 50 million bushels; the forecasts for food consumption by people and fodder for farm animals were cut by 25 million bushels. We deem that such expectations buoyed corn prices. It is possible that in today’s report the outlook for grain intended for ethanol production may be raised even more as world oil prices rose. Note that USDA data might affect the prices of corn, wheat, soybeans, cotton and beef.

    #C-CORN

    Let’s consider Corn on the H4 chart. It is currently traded sideways and formed the graphic pattern called “triangle”. RSI-Bars oscillator is located above 50 and forms an uptrend channel. However, as we noted above, the final price direction of the CFD CORN will be determined by the USDA report. In our opinion, the trend might be defined after the price leaves the “triangle”. Let the market choose the price direction. The most significant levels at 384.1 and 393.4 are confirmed by Bill Williams fractals and Donchian Channel boundaries. Two positions can be placed at the opposite levels: after one of the orders is opened, the second one can be deleted. It means the market has chosen the direction. After pending order placing, Stop loss is to be moved every four hours near the next fractal high (short position) or low (long position), following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point.

     

    Position Sell
    Sell stop below 384.1
    Stop loss above 393.4

     

     

    Position Buy
    Buy stop above 393.4
    Stop loss below 384.1

    Dear traders. For the detailed report of the strategy based on analytical issues of technical analysis click here.


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