Wheat Commentary
Dec Chgo Wheat closes 3 ¼ cents higher ($4.48), March 2 ¼ cents higher ($4.65 ½) and July 1 cent higher ($4.90)
Dec KC Wheat closes 2 ½ cents higher ($4.41 ¾), March 2½ cents higher ($4.59 ¼) and July 2 ½ cents higher ($4.90 ¼)
Egypt announces an overnight tender for optional origin wheat – overnight Egypt buys 180.0 K T. Russian wheat
Despite US wheat not being offered at last night’s Egyptian tender US wheat prices edged higher on Tuesday. Inter-market spreading and flat price short covering from the spec sector remains the best buying. It is my idea that specs are covering shorts as the recent attempts to sell off ailed to break out of the up channel prices have been in since late August.
Interior SRW prices are firming to Toledo. Two days ago SRW firmed to Decatur, IN. The Gulf too is firming for SRW. With that said Chgo spreads made new highs for the rally that started in mid-late August. Oklahoma millers are suggesting that have bought enough HRW for now. HRW for export continues to remain firm. KC spreads remain quiet.
The well-defined up channels remain intact and that spurs speculative short covering. The break we saw last Friday created some interim resistance for Dec Chgo in the mid-$4.50’s. That level looks to be challenged in the near term. Similar resistance for the Dec KC market is in the low $4.50’s. All I can offer at this time is to put your trading shoes on and leave your attitudes at the door as I’m not sure these two markets are going anywhere fast.
Daily Support & Resistance for 10/04
Dec Chgo Wheat: $4.42 – $4.56
Dec KC Wheat: $4.36 – $4.51
The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results.