Focus: March Corn, December 14, 2007
In the December 3rd report on March Corn, price was noted to be bullish and nearing resistance at $4.11. Price was trending up on strength as measured by an ADX of over 30. Since then, the overhead resistance at $4.11 was decisively broken to the upside. Prices then walked the upper Bollinger Band and ended the week at $4.38, just 5¢ shy of the June high of $4.43. Price is likely to weaken on profit taking as a stronger overhead resistance is approached. The +DMI is showing negative divergence with price, and the potential for a retracement to the 20-day moving average is increased. The daily chart currently shows a cup-type pattern. The long-term outlook is still bullish with daily trend strength now at an ADX of 47.
Dr. Charles B Schaap is the author of ADXcellence—Power Trend Strategies. He is a director of the Hedge Fund Association. His website is www.adxcellence.com.
Chart Courtesy of TradeStation
