Corn Double Bottom (D)
Created on Sunday, 22 March 2015 00:31
Written by Austin Galt
Corn looks to have made a bullish double bottom and now looks on the up. As outlined in the previous article, Corn On The Bob, we have been expecting a rally and that now looks in play. Let’s investigate using the daily chart.
CORN DAILY CHART
We can see price has put in a low on the 18th March at US$367 which was marginally above the 30th January low of US$365. This sets up a double bottom with the trend which is very bullish.
This bullish set up should see price trend up and bust above the previous swing high which was set in December 2014 at US$417.
I have added Fibonacci retracement levels of the move up from October 2014 low to December 2014 high and the double bottom has been around support from the 50% level which keeps the uptrend in a reasonably strong position.
The Stochastic and Moving Average Convergence Divergence (MACD) indicators are both showing recent bullish crossovers and both look to be in strong position with a pattern of higher lows. I now expect these indicator readings to make higher highs.
There is no change to the longer term forecast outlined in the article, Corn On The Bob, which details two likely rally ending levels. Currently I favour the more bearish option which involves price failing to take out the May 2014 high at US$519.
We can analyse likely rally high levels further down the track.