Grain TV by Grain Hedge
Grain TV is a daily recap after the market close, providing opinions on fundamental analysis of market direction, influences and expectations. This daily program is produced by Grain Hedge, a discount brokerage firm that provides farmers and elevators with agricultural intelligence including live market quotes, cash bid data, the Grain Hedge Optimizer™ and mobile trading platforms, all for $7 commission per side. Grain Hedge provides tools to allow farmers the ability to trade when the markets move without having to wait for a broker and the information to execute a marketing strategy with confidence.
RSI for DEC Corn Nearing Over-Sold Territory
Nov 23, 2011
Below we have a screen capture taken from the Firetip platform. We see C1Z trading lower in today's action, down 9 1/2 cents at the time of this post.
Continued strength out of the dollar is helping pull grains lower this morning, and we are now trading 10 cents below the 600 level we have been watching for a while as a level of near-term support. With this in mind, take a look at the low-trade volume we have seen this week as few traders are adding positions moving into the Thanksgiving holiday. We have certainly moved through this level of near-term support, but with declining volume this move lacks the conviction to spur a sharp move lower.
Looking at the Relative Strength Index (RSI) on DEC corn, we see that with today's action it sits at 32. When the RSI reaches 30, technicians consider the contract to be in over-sold territory. This supports the idea that we might see a bounce following low volume selling, but lets take a look at the last time we saw the RSI reach 30. This was back on September 21st, and we saw DEC corn trade nearly 70 cents lower before finding the bottom on October 4th. This highlights the fact that technical indicators can be helpful in making trade decisions, but are only a small piece of the puzzle.
If you would like to chart DEC corn today in your home, take a demo of Firetip or contact a Grain Hedge broker - 866-472-4607. Have a great Thanksgiving everyone, and we'll see you back here on Friday.
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