It’s been a tough year for corn prices. The move down from $8.4375/bushel on 10Aug12 has been aggressive and unrelenting. Perhaps most notable on the chart is the gap down from $6.84 to $5.4975 which occurred in Jul of this year.
Ultimately, support lies in the $3.25-2.96 range. However, expect price to retrace the move lower in the short-term, potentially into the gap area, prior to resuming the downtrend. We expect volatility levels to continue trending lower.
Murphy & Co’s Corn model currently holds a short Corn Futures (symbol: C) position from the $4.95 level.