Today’s high in January beans came within one cent of the 38% Fibonacci retracement at 14.47 1/2. this is a good place to take profits on any long futures or long options. there might be another 50 cents left to go, so I wouldn’t be getting short here. Only taking profits at a technical resistance level.
Chicago March Wheat has rallied 37 cents from its 4 month lows, and remains in that channel formation. I like the 8.90 to 9.00 level as the next sell target. Today’s high met resistance at 878, which is the 38% retracement of the down move as well. 888 is the 50% and 898 is the 62% retracement.
Fibonacci’s work well when they work well. This is one of those instances. Like all other technical indicators, they all look great some of the time. There is no full proof magic trading system. Sorry to burst you bubble.
However, technical tools can give you the courage to place a trade, or the target area to take profits, which a lot of traders, (those with the all or nothing mentality) seem to forget about. Every trade has a 50/50 chance. Managing the profit or the loss is the key, and that is a difficult art form.
Moving on to march Corn, now that December futures are no longer top step. March corn at 7.55 is the laggard today. It might be a case of traders spreading wheat and bean purchases with corn sales. That being said, corn has rallied 42 cents a bushel from its recent 6-week lows. Take some profits between 757 and 762 1/2. If we settle above 762 1/2 , we should snap up to 7.75 and possibly, possibly, a new run at 8.00 corn. Although something about this corn rally has me suspicious of its under lying strength. I am cautiously bullish,
That’s about it for now.
CER