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Corn and Wheat Break out Soybeans Lag

Corn and wheat price broke out to fresh-highs on Tuesday and are consolidating their gain in early trade on Wednesday. Soybean prices climbed but were unable to pierce through resistance. Cold weather and slow plant were the catalysts for the breakout. The cold weather is now in the rearview mirror and warmer than normal weather that is dry is expected to take its place.

Corn Prices

Corn prices closed at a 10-month breaking out on Tuesday. Target resistance on corn is now seen near the June 2017 highs at 4.39. Support is seen near the 10-day moving average at 3.86. Momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in the black with an upward sloping trajectory which points to higher prices.

Soybean Prices

Soybean prices whipsawed Tuesday closing slightly higher. Support is seen near the 10-day moving average at 1032. Resistance is seen near a downward sloping trend line that comes in near 1066. Momentum is positive to neutral as the MACD (moving average convergence divergence) index generated a crossover buy signal, but the MACD trajectory is descending. This reflects consolidation.

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Soybean export activity for the week was down 64% from the prior week and 63% less than the prior 4-week average. 2018/19 export sales were 166.5 TMT. Combined season sales were down 75% week over week. Total export commitments are 97% of projections with 19 weeks to go and need to average 94 TMT in weekly sales to meet forecast. Current export sales are 3.5% behind last year’s pace.

Wheat Prices

Wheat prices broke out on Tuesday closing at its higher and poised to test target resistance seen near the July highs at 5.53. Support is seen near the 10-day moving average at 4.85. Momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line).

This article was originally posted on FX Empire

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