We are looking at the Corn continuation chart today. This chart also comprises the weekly chart data. The recent massive selloff of 60+ cents was the result of the funds liquidating 104,828 long contracts (open interest decrease) on the CFTC legacy report - commitment of traders - webpage below.
They only added 895 short contracts, and open interest declined by a total of 67,958 contracts. The rule of thumb with price movement and open interest is that a selloff with a decrease in open interest like we see here, is a corrective move, not supportive of the primary trend which is up. By contrast, a selloff with increasing open interest would indicate a downtrend is the primary energy/direction.
The May and continuation charts look like they are creating an inverted head and shoulders pattern. The May contract's neckline is about 518, whereas the continuation chart neckline is about the price of 508.
To figure out the target, you measure the distance from the head (below) to the neckline where price intersects. That figure on the continuation chart is 120 cents and about 104 on the May chart. 120 cents plus the neckline (508) equals about 628 for an upside target.
Here is the daily continuation corn chart with the inverted head and shoulders pattern:
Here is an interesting fact: Hard wheat is used for bread and soft wheat is used for pastries. When one chews a small handful of wheat, within a matter of minutes, a wad of gum is left in one's mouth. That is a protein called gluten. Hard wheat has a higher gluten content than soft wheat. That is why cookies and cake have more crumbs than bread.
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