Jan beans flirted with the long-term bearish trend line which extended all the way back to this Summer’s highs in June at 1103. In the last six trading sessions we have rallied 80cents from our 1- 1/2 month low at 952 just a week ago to today’s high at 1031. On the charts we have resistance now at 1050 and 1068.
In the Corn, we had similar action around its long term bear trend line as well, with 403 1/4 being the intersection today. For the afternoon we poked above it by a cent, but then settled below it at 401 3/4… Not as convincing a run, and if anything we may have seen some buying of the beans and selling of the corn on that spread. The wheat saw more fund buying today, with a low at 555 1/4 and a high at 575 1/2… On a cautionary note, WZ has a suspicious looking double top at this level, with today’s high, and the Oct 23rd high at 574 3/4… There is a third resistance at the Aug 3rd high at 585, which looks to be the next target for the rally.
All in all a convincing rally in the grains, with no interest in a turn-around-Tuesday trade.
At one point this afternoon, it looked as if the beans were going to reject the trend line at 1014 3/4, and in fact, probably sucked in some new shorts, who were all whacked this afternoon when we shot above the 21 level late in the day with a ten cent rally to the 1031 level.
In the stock indexes, DJZ again failed to go after the 10,404 level, so far, with, surprisingly the remnants of yesterday’s large sell order evident on the screen with over 760 contracts resting on the sell side, looking like an inviting target. As of this writing, we traded up to 10,400 then had a quick pull back down toe the 10373 level. However, I would watch that level after the 2PM CST close in the Bonds. Bulls may be determined to run up and trade there. Large resting orders always seem to attract trade sooner or later, no matter what market you are watching.
Good Trading