Wheat Commentary
March Chgo Wheat closes ¼ cent lower ($5.02), July 2 cents lower ($5.21 ¼) and Dec 1 cent lower ($5.54 ¾)
March KC Wheat closes 4 ¼ cents lower ($5.29 ¼), July 3 ½ cents lower ($5.57 ¾) and Dec 3 ¼ cents lower ($5.90 ¾)
Flip-flopping up against the recent upper end continues. This type of price action can be construed as a top. I doubt the USDA can have anything influential to say that will support the recent rally as the rally has been about the droughty conditions in the central western sections of the US HRW belt. Trade guesses have the US carryout rising due to feeble exports. World ending stocks’ projections are expected to decline by about 500 K T. None of these numbers support the current rally.
The price action is trying to suggest a top but so far no confirmation. The rally is about dryness in the central southern Plains – the latest forecasts are suggesting it is going to stay that way. Will a sharp drop in futures tomorrow due to bearish looking old crop fundamentals provide us a low risk buying opportunity?
Daily Support & Resistance for 03/08
May Chgo Wheat: $4.80 – $5.20
May KC Wheat: $5.15 – $5.55
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.