Oats futures followed the rest of the grain complex lower in Tuesday's session, triggering a technical breakout on the Autochartist platform. The breakout was detected on the 240-minute time frame and projects a possible trend reversal towards a substantially lower price level.
Autochartist has been tracking a major Triangle chart pattern in the oats futures since the completion of a sell-off down to $3.15 per bushel two weeks ago. The pattern ranks 6 bars in overall Quality, and Wednesday's breakout has a strong 10-bar momentum reading. This indicates a higher possibility of a follow-through to the forecast target range.
Continued selling pressure in Thursday's session may send the market towards the minimum projected price of $3.29 per bushel to complete the pattern. The recent strength in this market may prove to be a shallow retracement in a longer term downtrend, in which case the bottom of the range at $3.16 per bushel may be tested. This would result in a 100% retracement of the move higher, and pave the way for a prolonged resumption of the downtrend with new bearish technical patterns developing on the platform.
For further information on this and other Autochartist products, visit our website at www.autochartist.com