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Corn Elliott wave analysis

Function - Trend 

Mode - Counter-Trend

Structure - Expecting Impulse Wave 

Position - Wave 2

Direction - Wave 3

Details - Wave 2 may not drop inside the 419-413 support zone where we expected it to end. Perhaps it has been completed with the surge to 438’4 and the subsequent corrective response. Wave 3 is probably in play and will be confirmed by the breach above 438’4. However, a double three corrective pattern into the zone is still likely. So we need an important impulse break upwards to confirm wave 2 has ended.

Between 26 February and 13 March 2024, Corn gained over 12%. However, that’s merely a 17% recovery of the April 2022-to-February 2024 sell-off. Thus, there is still some way upside to go. From the Elliott wave perspective, it seems the current recovery will extend higher into the 22-month sell-off. By projection, the price might correct up to 571-623 Fibonacci retracement area. Today’s commodity blog post intends to show traders how to gain from this bullish corrective cycle.

On the daily chart, from 824, we identified a corrective decline from April 2022 down to 394 in February 2024. Ideally, an impulse wave should follow to break above 824 in the long term. However, in this case, we will consider a 3-wave corrective bounce at first, and if the price supports, an impulse later. Currently, the price is in blue wave ‘A’ of blue wave ’1’ (both circled). We expect either to start with an impulse wave. On the H4 time frame, we can see the sub-waves of the current bounce better.

On the H4 chart, a rally from 394 has completed the first impulse - wave 1. This is an indication that we may be right with the expected strong corrective rally or a long-term bullish impulse. From the end of wave 1, wave 2 has emerged and is quite debatable in the way it’s being structured. We expected wave 2 to end in the 419-413 key support zone. However, it appears wave 2 has ended with an expanding flat pattern. Flats can be quite tricky and can quickly transform a different pattern. Two ways to confirm wave 3 has started:

1. price breaks above blue wave ‘b’ of 2 high and 

2. an impulsive break above 438

If the price confirms the end of wave 2, we should see wave 3 between 492 and 515 or maybe even higher. Thus, there’s more room to the upside for buyers to explore. However, if wave 3 is not confirmed, a further dip into the 419-423 or even lower shouldn’t come as a surprise.

Technical Analyst : Sanmi Adeagbo

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