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Weekly Review - Grain Futures for June 13th - June 17th |
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By Pratik Patel
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June 21, 2011
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Last week the USDA released their supply/demand report for the grain complex pegging Corn and Wheat bullish, while Soybeans were seen as bearish. After those projections were announced, Corn continued to rally into Friday (6/17) hitting an all time high of 7.9975, missing the major price resistance 8.00 a bushel by 1 tick. Wheat surprised traders as prices declined and Soybeans went along with the bearish report.
Monday (6/13) Corn formed an inside-day chart formation along with Soybeans while Wheat made new daily highs, but settled down. With Corn trending up for almost a year now, traders expected prices to continue rallying higher. This was not the case Tuesday morning, as Corn broke at the opening bell sending longs running for cover. Volume picked up in the Corn pits as sellers kept driving prices lower down to their daily imposed limit down offer. Nervous bulls approached Wednesday morning ready to hit the “sell” button. Corn once again started to sell off from the open and for a second day in a row hit their daily limit offer. With Corn losing nearly 60 cents, they were at pre USDA report levels. Technical traders were looking for a market correction, but they were unable to find that as Corn once again sold off heavily on Thursday. Corn broke and traded below their major price support 7.00 per bushel. In less than a week Corn lost nearly $1.00 a bushel. Corn sold off into Friday, only to settle 1 tick above 7.00 for the week. Corn has the lowest settlement in nearly a month.
Wheat futures also shocked traders as prices continued to fall in the footsteps of Corn. Wheat started to break major weekly and monthly lows mid week and finally took out their yearly lows Thursday afternoon. The massive sell off in Corn and Wheat has put a lot of liquidation pressure on the long term swing traders as both grains have been making new monthly highs for the past year. Wheat settled the week down and the lowest close since August 2010.
To learn more from Pratik and the guys at The Futures Room, visit their site at TheFuturesRoom.com |
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