This is a sample entry from Tom Dosdall’s newsletter, Technical Ag Knowledge, published on Monday August 22, 2016.
**Commitment of Traders (futures only as of Aug 16) CORN -165,109 (-23,614 since Aug 9); SOYBEANS +88,510 (-10,915) SRW WHEAT -106,956 (+13,356)**
Corn gained 10’4 last week despite the bearish Aug 12 USDA report. We start off the new week right in the middle of the “fair value” zone with 336’2 offering support and 348’4 resistance. Momentum on TAS Navigator is hooking upward/bullish so we view a close above 348’4 to potentially be technically significant for trend. The index funds are heavily short so a close above this level could help to trigger short covering. There is another heavy level of resistance above in the 370’0-380’0 range. Bias: Neutral for now, but bullish at 337’0 and above 349’0.
Soybeans are fighting to hold on to technical and psychological support at 1000’0 this morning. As long as they close above this level the trend is still up/bullish. A close below is not necessarily bearish but it does put the market back in a “neutral” balance with short-term downside potential. The 200 day moving average has bumped up to 972’2 and intersects with the TAS point of control, so I view this level to be the next potential leg down. Bias: Bullish above 1000’0 and on a potential dip to 974’0.
Another slight decrease in the net short futures position is seen is last week’s Commitment of Traders report, stoking the bull hopes that this market has priced in about as much bearish news as it can handle. The trade is within a neutral/fair value trading zone between 434’4 and 469’2. Shorter term, resistance is coming in at that TAS point of control at 447’4 (teal colored dotted lines). Bias: Bullish from 435’0.
Cotton saw more follow-through selling and long liquidation last week following USDA’s bearish supply outlook in the Aug 12 report. Bulls are looking to the new demand zone provided by TAS Boxes at 0.6780 this morning for support. Should that fail, the market looks vulnerable to want to retest the 50 day moving average near the consolidation zone around 0.6575. Bias: Mildly bearish. Mildly bullish in the 0.6575 zone.
As mentioned last week, the 10 month bear trend resistance line continues to hold back this market from rallying and we saw astrong selloff last week. There is little to look at in terms of support on the chart right now so bulls are probably counting on short term short covering rallies for help. Until this daily chart substantially changes, I remain bearish from the upper line (114.500) and bullish from the lower line (104.000).
Hogs start off the new week trading above the TAS supply zone which puts the market out of balance and in favor of the bulls. Momentum on TAS Navigator is hooking upward toward the 0.0 line. Look for old resistance to potentially provide new support of the uptrend at 60.600. Over the next 30 days, bulls could want to target the consolidation of moving averages near 67.000. There is a good base of support at 58.000.
The Dollar chart is out of balance/bearish and momentum is suggesting the sell side of the trade could be building. Short term rallies toward 95.000 are viewed as selling opportunities. Bear targets could be on longer term support near 93.600.
Crude oil has only had one “down” day in the past 13 sessions but starts off the new week with what looks like a fish hook reversal pattern. Is this the end of the sharp upswing or just short term profit taking? I think we need to watch the 50 and 100 day moving averages for confirmation of support for the bull trend. If we see a close below that level the trend would be confirmed as shifting back to the bears, in my opinion. Remember, crude oil is often the “leader” of commodity prices as a whole so grain bulls out there want to see this recent strength continue.
Subscribe to Technical Ag Knowledge – Paid Edition – Monthly
Technical Ag Knowledge – Paid Edition – Monthly - Whether you’re a producer, end user, or trader in the agricultural commodity markets, “Technical Ag Knowledge” will provide you with a crucial awareness of key technical price levels each week so you can manage your positions with conviction and confidence.
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.