Corn is finding a floor

Corn prices have retraced an exact 50% of the rally which commenced in August 2020.

In the past few months, I have been writing about parabolic price moves and highlighting the risk of ‘going long’ at what seems the tail end of an advance which sometimes can resemble chasing a mania.

Albeit Corn is currently in a downtrend, my other indicators suggest that the strength of the decline is dubious. If Corn shoots below the 50% retracement mark, it should stop at the 50 Week Moving Average of $4.99.

That’s only a further 5.6%, following an already 28% decline from its $7.35 peak in mid-May.

Let’s not try and squeeze out the last kernel?

Perhaps it’s time to sell my equity holdings in Gruma (the tortilla and taco maker) and Kellogg. Their input prices may start rising again.

July 12, 2021
by Rob Zdravevski
rob@karriasset.com.au

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