HighGround Dairy Technical Commentary – September 6, 2013

CME Class III Milk Futures October Class III Milk broke down to a new four day low during Friday’s session and left Wednesday’s high of 18.36 as near term resistance. The price breakdown back below 17.80 turned the near term bias of the market back in agreement with the intermediate term down trend pattern. It is also worth noting that price momentum indicators had become technically overbought during the rally from the August 22nd low and have since turned lower. While the trend points down, the market remains trapped inside of a broader range, with 18.36 on the topside and 17.60 below. A close in the October contract above 18.40 is needed to turn the intermediate trend in favor of the bulls.