Technical analysis: Will the corn price continue retreating?
|Recommendation for Corn: Sell
Sell Stop: Below 678.5
Stop Loss: Above 712
RSI: Neutral
MACD: Sell
Donchian Channel: Sell
MA(200): Buy
Fractals: Sell
Parabolic SAR: Sell
Chart analysis
The CORN technical analysis of the price chart in a 4-hour timeframe shows #C-CORN, H4 is falling toward the 200-period moving average MA (200), which is rising itself. We believe the bearish momentum will continue as the price breaches below the lower Donchian boundary at 678.5. A pending order to sell can be placed below that level. The stop loss can be placed above 712. After placing the order, the stop loss is to be moved every day to the next fractal high, following Parabolic signals. Thus, we are changing the expected profit/loss ratio to the breakeven point. If the price meets the stop loss level without reaching the order, we recommend canceling the order: the market has undergone internal changes which were not taken into account.
Fundamental analysis
USDA upgraded its estimate for corn ending stocks in the WASDE report. Will the CORN price continue retreating? USDA’s May 2021 World Agricultural Supply and Demand Estimates (WASDE) report upgraded world and domestic corn ending stock estimate. USDA forecast for world-ending stocks for 2021/22 was estimated at 11.508 million bushels, 3.3% higher than the average estimate by analysts prior to the publication. At the same time, domestic ending stocks for 2021/22 were estimated 19.9% higher compared with the 2020/21 figure at 1.507 billion bushels. At the same time, WASDE predicted US corn exports would decline 325 million bushels during the 2021/22 marketing year. Higher ending stock and lower export estimates are bearish for corn prices.
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