Corn

We're looking for a low-risk spot to get long, but the effort will have to take into account the possibility that the futures could take off without accommodating our niggardly bids. At yesterday's close, they looked like they were developing thrust for a push to 793.50, a Hidden Pivot 'D' associated with a 771.625 midpoint resistance where the rally has very precisely stalled.  I've sketched a hypothetical entry opportunity for camouflageurs, but you may have to improvise if things don't play out so perfectly.

We've talked in the chat room about the prospect of a corn shortage developing this fall, but today's touts 'actualize' this with a buy recommendation in March Corn, provided certain conditions are met. We will be -- if you'll pardon the expression -- stalking Corn in the weeks ahead, so if you have an interest in leveraging this vehicle, stay tuned.

I'll be tracking March 2012 Corn closely in the weeks ahead, based on the prospect of increased demand from China as discussed in the chat room. Although camouflage entry will generally be the preferred entry strategy, especially until we find the range and rhythm of this vehicle, I'll use conventional tactics at times so that relative novices can participate. For now, though, I'll suggest using the 15-minute chart or less to buy four contracts using 'camo' at the 739.25 'd' target of the following retracement pattern on the 60m chart: a=787.00 (8/31); b=749.75 (9/1); c=776.50 (9/2).

Targets well above these levels that were flagged a couple of weeks ago are in play at the moment, the futures apparently having completed a consolidation just above the 664.50 midpoint resistance associated with the lower of the two.  Our immediate 'D' objective lies at 753.50, but as noted here previously, anything decisively above it will imply 791.50.  To get long, even camouflageurs will have not be at their most alert, since this is not IBM, or  the E-Mini S&Ps, or any of the other vehicles that are usually easy pickings for us.  It is in fact one of the most cagey and devious vehicles we could look to trade, since it is the bread and butter of a thousand guys whom you would never want to play poker with.  For starters, you'll find that entry prices will be exceeded on gaps and that, even on the five-minute charts, multiple 'c' lows will be carved out before this quintessentially nasty little critter takes off.

The futures never quite made it down to our 652.50 bid, although deft camouflageurs could have found some risk-averse ways to get on board not long after the actual low occurred at 665.50.  The current rally projects to 753.50, or perhaps to 791.50 if any higher, so there are good reasons to keep trying if you're on the sidelines and looking to climb aboard.

December Corn looks like it's staging for a 10% rally, the technical basis for which is shown in the accompanying chart. Although camouflage opportunities are not readily apparent on the 'hourly,' I'll recommend zooming down to perhaps the 30- or 15-minute bars if you're eager to improvise a camouflage entry at these levels. An entry signal has already been tripped on charts of larger degree, but the futures have not yet taken off.  Please note as well that there is specific Hidden Pivot risk you should be aware of, since there's a weak corrective abcd pattern also at work with a 675.50 midpoint support and a 658.25 'd' target. (60m, A=698, B=663.25, and C=693.) _____ UPDATE (12:51 p.m. EDT): The futures have taken a header this morning, smashing the midpoint support identified above and trading as low as 665.50.  The 658.25 target remains valid for bottom-fishing, but it should only be attempted using the "camouflage" technique. If you'd rather try to get long with a straight bid and a very tight stop-loss, try it at 652.50, a 'd' Hidden Pivot target derived from the July 19 peak at 703.75. That's my maximum downside objective for the near term, although it's possible the futures will turn from above it and you'll miss the trade.

Rick was indeed very busy in front of the microphone this weekend. In this 15-minute segment with Kerry Lutz of the Financial Survival Network, Rick discusses his views on gold, palladium and corn.

The emphasis during this session was on spotting camouflage opportunities and steering clear of traps in real-time charts for Gold, Silver, Corn and the E-Mini S&Ps. Although it will nearly always be possible to force a long or short trade in some time frame, we can reduce stress and effort by initiating trades only when they are based on impulse legs that conform strictly to our rules. In particular, we should expect to find the best – and easiest – trades at swing highs and lows that have been signaled on charts of higher degree. In all instances, finding the first such signal amidst the panic, fear and uncertainty of others will afford the most trouble-free path to success.

Rick's Picks is warming to the idea of a bullish play in Corn, the subject of an urgent 'hot tip' that we received in Tuesday's e-mail.  However, our plan is to play it strictly by-the-book, risking as little as possible if the tip doesn't pan out (as frequently occurs).  Click here if you don't subscribe but are motivated nonetheless to find out exactly how we do things around here.  Trading should be fun, don't you think?