Bearish chart signals keep canola pointed lower

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Published: December 18, 2017

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Bearish chart signals keep canola pointed lower

CNS Canada — Canola contracts on the ICE Futures Canada platform have lost roughly $30 per tonne over the past month and have more room to the downside from a chart standpoint.

The nearby January contract settled Monday at $491.20 per tonne, just above the September low of $489.50. A break below that point would set the stage for a test of the $475-$480 per tonne area.

The March contract fell below the psychological $500 per tonne mark Monday, with the next support coming in at about $485-$490 per tonne.

The Relative Strength Index (RSI) is in oversold territory, which could be a sign of an impending corrective bounce.

If canola does manage to recover off of its nearby lows, the first upside target in the January contract likely comes at $500 and then again at the 200-day moving average of $503 per tonne.

For the March contract, a return to the 200-day moving average would take the price back to $508 per tonne.

— Phil Franz-Warkentin writes for Commodity News Service Canada, a Glacier FarmMedia company specializing in grain and commodity market reporting.

About the author

Phil Franz-Warkentin

Phil Franz-Warkentin

Editor - Daily News

Phil Franz-Warkentin grew up on an acreage in southern Manitoba and has reported on agriculture for over 20 years. Based in Winnipeg, his writing has appeared in publications across Canada and internationally. Phil is a trusted voice on the Prairie radio waves providing daily futures market updates. In his spare time, Phil enjoys playing music and making art.

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