Weekend Update - Grains

CORN
The corn market had a strange week. Price exploded higher Tuesday, up over 9% on HUGE volume, yet ended the week lower than where it began.

Generally a move like that, with volume to back it up, has follow through.

The question we have to ask is - does the 302 L have any significance? There is the chance that primary [5] ended on 9/8. If you ratchet up the degrees by one from what I show on the chart, you can certainly make that argument.

At this point, my guess is that wheat is still in a downtrend. What I have labeled on the chart is one way of looking at structure.

I also show an alternate count that may be in play. It is entirely possible that this could be a big [4] wave triangle of the running type (where B exceeds the price extreme of trend).

The main issue that I have with the triangle interpretation is that [4] would be so out of proportion to [2].

The critical levels to pay attention to this next week are 373, which is the price extreme of [4], and the 302 L. Price action through either of those levels narrows the possibilities of what structure is up to.

I will maintain my current bearish bias at this point, however, I'm open to the possibility that an important bottom has been found in this market.

All prices basis continuous contract.

SOYBEANS
The bean market found support at the 50% retracement level Monday before shooting higher with the other grains on Tuesday.

It's unclear whether primary [B] has completed or not. My guess is that the double zigzag down finished just intermediate (A) and (B) is in process.

If this is the case, (C) = (A) at 829.75. The (C) = 78.6% of (A) at 861.375. This fits in with the confluence mentioned in last weeks update.

If [B] has finished at the 892 L, then [C] = [A] at 1185.75. The minimum objective would be where [C] = 61.8% of [A] at 1073.50.

Wednesday is slated for a cycle peak. This comes from 7/16 and 8/18.

All prices basis continuous contract.

WHEAT
Like its fellow grain markets, wheat had a big day Tuesday with no follow through.

Out of all the grain markets, wheat continues to display the most weakness.

It appears as though wheat is tracing out a minor degree 4th wave currently. If so, it was a pretty muted 3rd, but did have a nice fib relationship.

Perhaps this pause here is another lower degree [i] , [ii] setting up. This would be a very bearish setup for this market, portending much lower price.

If this is a minor 4, I would expect 5 to extend, though it certainly doesn't have to. 5th's are the big extension waves in commodities.

Intermediate (3) = (1) at 417.50. I'm still looking for sub 400 price eventually.

We did have a minor cycle low that was suppose to hit Friday. We are still a couple of weeks out from a good cycle low.

Critical resistance is the wave (2) price extreme at 517.25.

I maintain my bearish bias in this market until proven otherwise.

All prices basis continuous contract.