Focus: May Corn Breakout
May corn futures surged 7% last week and outperformed both wheat and soybeans; corn rose 27 points to close at $3.88-4. The USDA projects planted acreage for corn this year to be 86 million acres, but farmers are reportedly shifting from corn to soybeans. Corn’s rise may reflect worries over planted acreage, and all eyes will be on the March 31 planting intentions report. Technically, corn had been trading in a falling wedge pattern since early 2009, and corn broke out last week to a new five-week high. The +DMI is above the –DMI, meaning price is setup to move higher. There is upside resistance at 420 and 450, and a potential target of 465.
Chart Courtesy of TradeStation.
Dr. Charles B. Schaap transitioned from health care to wealth care in the nineties. He is the author of ADXcellence —Power Trend Strategies and Invest with Success—Big Profits for Small Investors. Dr. Schaap is a commodity futures strategist and recognized authority in technical analysis of the financial markets. His website is www.adxcellence.com.