Wheat Commentary
March Chgo Wheat closes 5 cents lower ($4.55 ¾), July 3 ¾ cents lower ($4.83 ¾) and Dec 2 ½ cents lower ($5.19 ¾)
March KC Wheat closes 4 ¾ cents lower ($4.69 ¾), July 4 ¾ cents lower ($5.02) and Dec 4 ¼ cents lower ($5.41 ½)
Weekly Wheat Export Sales – old crop vs. 200-450 K T. expected – new crop vs. none expected
Thoughts that the central southern Plains may see some moisture relief sooner vs. has the US wheat markets on the defensive; KC more so vs. Chgo. We know the funds the have been establishing a net long positions in KC while still covering shorts in Chgo. It was just last Wednesday when the March/March traded 24 ½ cents over (KC vs. Chgo). Today saw it trade into 13 cents over. Bull markets don’t trade like this. The recent rally has been all about fear concerning a crop that has yet to come out of dormancy. The threat of beneficial moisture has recent buyers now questioning themselves. I could validate the rally if the US had some business but it doesn’t.
Cash wheat markets remain quiet. Toledo is looking for some wheat while export markets are soft. Spreads continue to widen out whether it’s in Chgo or KC. This is not very indicative of a bull market.
The technical look suggests wheat futures are moving into a correctional mode. March Chgo wheat has a minor gap to fill at $3.50. The best looking support is not until the mid-low $4.40’s. The best looking near term support for March KC wheat is the mid to low $4.60’s followed by something closer to the mid-high $4.50’s.
Daily Support & Resistance for 02/15
March Chgo Wheat: $4.50 – $4.60
March KC Wheat: $4.65 – $4.75
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.