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Rough Rice Reaches Key Resistance

10 December 2009


The Commodity Specialist view




2009 has been dominated by a recovery in prices.


The latest upleg, which broke free of consolidation below 14.00 (now a support area) has reached a zone of key resistance.


This includes the old 15.830 Aug-08 low and 16.350 38.2% retracement - a struggle to get through here would not surprise, with a s/term pullback becoming more likely.


A later return to strength is expected.




The structure of the last upleg from 13.500 Sep low looks mature, increasing pullback risk - this is emphasised by the current negative RSI divergence.


First area of support comes from the dual Fibo retracements, but the stronger area is slightly lower, prior 14.690/14.625/ 14.500 consolidation highs combining with the 61.8% and 38.2% pullback levels to offer potentially strong support.


Buyers on dips would favour this area.


Note that this key support area falls around 14.00 on the continuation chart.



Philip Allwright

Mark Sturdy

Seven Days Ahead


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