CNS Canada — ICE Futures Canada canola contracts broke above major resistance levels this week, hitting levels not seen since August.
However, as they say, what comes up must come down — and prices were well off of those highs by Tuesday’s close, bringing the market back within its long-standing trading range.
The most active March contract climbed as high as $493.20 per tonne at one point on Tuesday, seeing some follow-through strength after breaking above the psychological $490 level the previous day.
However, just as the stagnant technical outlook started to shift higher, the floor gave way and the contract dropped sharply to settle at $484.10.
The daily high likely marks a new upside target, while nearby support comes in at around $481 per tonne. The 20-, 50- and 100-day moving averages are all converging around the $481 per tonne level.
Beyond that, the next downside target comes in at around $468-$470 per tonne.
— Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.