COMMODITIES(B-Trams):
SINGAPORE:CBOT May corn is likely to begin a bounce after finding support at $6.09-1/4 per bushel. From the high of $6.84-3/4 on Feb. 14, the contract is riding wave 5, the fifth wave of a five-wave cycle. Since it is supposed to be roughly equal to wave 1, this wave may have overextended.
A structure indicating its completion could be seen in the fact that wave 5 could be divided into five smaller waves. Fixing the wave five’s ending point is typically very difficult.
The notion that $6.09-1/4 represents the bottom of wave 5 is not entirely unfounded.
On the daily chart, some convincing signals back Taiwan’s MFIG’s offer to purchase up to 65,000 tonnes of corn. Even though corn entered a $6.09-1/2 to $6.15-1/2 support zone, it is expected to pause at either level.
A bounce or consolidation is highly anticipated.
A break beneath $6.09-1/2 could affirm the expansion of the downtrend towards $5.92-3/4.
