The corn market lost 75¢ to 80¢ following USDA's devastating Jan. 12 reports that reported bigger than expected supplies. "An old trading rule is that after a major price drop, there's a 50% chance prices will bounce back 50%, and a 60% chance prices will recover 40%,” says Jerry Gulke. "Corn dropped below $3.75 and seemed to be making a saucer-shaped bottom. At the same time, the MACD indicator I watch gave a buy signal on a daily basis and today the market closed at $4, close to the technical signal that would tell me the worst is over.
"This week Drew Lerner of World Weather said it is not a matter of if but how big floods will be. He predicts flooding will be deeper and more widespread than last year, so we could see planting delays,” Gulke reports. "I don't know about you, but this year I am going to stop planting corn May 10 and switch to beans. I don't want $100 to $120/acre corn drying bills again. If others feel the same way, we may not get the anticipated corn acreage.”
Listen to Jerry's commentary for more information about the markets--and come back right here late Sunday or early Monday for his updated corn and soybean charts