Wheat Commentary
March Chgo Wheat closes ½ cent lower ($4.26 ¾), May¼ cent lower ($4.39 ¾) and July ¼ cent higher ($4.54 ¼)
March KC Wheat closes ¼ cent lower ($4.38 ¼), May¼ cent lower ($4.50) and July ½ cent lower ($4.61 ¼)
Like the corn market the wheat futures’ markets went nowhere fast on Tuesday as prices consolidate just below recent highs. The only news of note had bearish slants to it – moisture forecasted for a good part of the US HRW areas and both Russia and Ukraine report adequate snow cover to protect their respective winter grains.
Interior cash wheat markets remain quiet. This holds true for export prices as well. I’m told cash wheat continues to move out of Chgo but so far this has had little impact on the Chgo spreads as they continue with their recent easing pattern. KC spreads continue to be a non-event.
The daily price action continues suggest the potential for higher prices but caution should be advised as some of the indicators I follow are starting to flirt with an overbought scenario. Personally I’m not in favor of paying current prices for new long positions. This is not to say prices can’t go higher in the near term – I just don’t like the risk vs. reward I’m seeing. Upside targets for the near term continue to be $4.34 for March Chgo wheat and $4.44 for March Kc wheat.
Daily Support & Resistance for 01/11
March Chgo Wheat: $4.21 ($4.18) – $4.34
March KC Wheat: $4.32 ($4.28) – $4.44
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.