Corn Futures: 3 White Soldiers

The Chart below plots the weekly price structure of the continuous Corn Future Contract. After trading in a two year downtrend, that has emerged after the 2008 “commodity blow off”, Corn broke to the upside at the end of August and made further gains after a positive crop report on the 10th of September.

The commodity space got additional support as Goldman Sachs Analyst J. Hatzius remembered the investment community that with the current weak economic data, another round of Q-Easing is expected to start in November 2010. Some traders got the message wrong, expecting already an announcement for Q-Easing by the FED at the next FOMC Meeting on the 21st of September 2001. This sparked a wave of selling in the USD crosses and helped Gold to a fresh all-time high. While Gold is looking firmly bullish at the current levels, soft commodities are far away from historical highs, and I believe that we are at the beginning of a very strong bull market in soft commodities. The 3 white bar charts that moved Corn out of the downtrend are showing a candlestick pattern, called 3 white soldiers, suggesting that this trend is likely to continue.

An interesting interview on soft-commodities can be viewed on CNBC.com

http://www.cnbc.com/id/15840232?video=1591248479&play=1