Technical Analysis November 1,2011

Corn Last week, the corn prices were fluctuated. The price decreases at a increasing rate from Tuesday to Wednesday, and then increases at a decreasing rate from Thursday to Friday. If we followed the price trend continues from last week, since the price increases at a decreasing rate, it was reasonable to explain that the price will drop on Monday since it implies that the price reaches the highest point on last Friday. According to Simple Moving Average, the fast moving average is decreasing, and the slow moving average is increasing, and the fast moving average appears that it is going to cross the slowing moving average from above in the next few days. It implies that the corn market might go to bearish mode in the near future. The fast moving average of MACD is still above the slow moving average, and it seems not to cross the slow moving average in a next few days. Also, the RSI is 49.15 between 20 and 80, which indicates that market is neither overbought nor oversold at this moment.

Wheat

Last week, wheat price has increased up to 652.6 on Friday, and has reached the bottom line at 616.4. This Monday, wheat price dropped significantly again, with change of -16.2.The RSI is 45.56, either overbought or oversold. The fast moving average and slow moving average are quite close to each other since last time the slow moving average has crossed the fast moving averaging and was above the fast moving average. MACD may give a clearer idea what is happening with wheat price. We can see the divergence is positive, which indicates a bullish signal.

Soybean The soybeans’ price saw a S-curve last week; kept going down at the first three days then rally and peak on Thursday and finally dropped back to the beginning level. Today, as the same cases as the other two commodities, soybeans price dropped significantly. The fast moving average is below the slow moving average which is a bearish signal. And the RSI is 40.94 which is quite neutralize. From the view of MACD, MACD now is in its bullish territory. But do not forget, the MACD only provides a strong signal when the two lines cross.