Dollar Breaking Lower, Corn Higher

The dollar is playing out as I expected it would late last month, and I think the dollar has quite a bit further to go before finding any sort of support.  These dollar cycles often times find turning points around the unemployment report, which in this case will be February 3.  By then, the dollar will likely break the intermediate trend line and the 200 day moving average.  

One of the main commodities to benefit from the decline in the dollar will be corn.  I pointed out last month that I expected corn would move higher as the dollar declined, and now corn has broken out above its intermediate trend line and its horizontal resistance.  A move to the $4.09 level at the 78.6 retracement makes a logical target at the very least.

Corn has a lot of upside before reaching oversold levels.  Sentiment readings are not even at 50% yet.  There are still plenty of buyers for this rally.

The only indicator that causes me pause is the Commodity Channel Index.  The CCI is nearly at oversold levels already.  If corn can't reach 4.09 by the time a sell signal is given by the CCI, I may pull the trigger on corn a bit earlier.