December Chgo Wheat closed 4 ½ cents higher ($5.07 ¼), March 4 ¾ cents higher ($5.10 ¾) & July 3 ¼ cents higher ($5.17 ¾)
December KC Wheat closed 1 ½ cents higher ($4.18 ½), March ½ cent higher ($4.26 ¼) & July ¼ cent higher ($4.40 ¾)
December Mpls Wheat closed ½ cent lower ($5.03 ¼), March 1 cent lower ($5.18 ¼) & July 1 cent lower ($5.39 ½)
Weekly Wheat Export Inspections – 449.3 K T. vs. 350-550 K T. expected
Weekly Winter Wheat Crop Condition & Progress – 52% GE (-2%) vs. 53% expected vs. 56% year ago – Planted – 95% vs. 95% expected vs. 95% 5-year average – Emerged – 83% vs. 86% 5-year average
Flat price wheat (Chgo) takes a look at below $5.00 and doesn’t like it. In other words there was no follow through selling and short covering ensued. I also saw a fair amount of inter-market spreading; buying wheat while selling corn and soy. When it was reported that Black Sea prices had firmed late last week in response to the recent Egyptian business that was all the short coverers needed to hear and more buying appeared. The end result was a big outside day with a higher close (but not above the previous day’s high). Make not that the other varieties’ price action, KC and Mpls, were not as friendly looking vs. Chgo.
Advertised basis levels for SRW run unchanged but with a firm undertone. The interior basis levels for HRW continue to run higher. Export values for both varieties continue to show a firm tone. I’m told the higher basis values is about slow movement not necessarily market making demand. Spreads for both Chgo and KC continue to run steady to higher.
See what happens when one chases a break in wheat to get it sold – you get burned. HRW crop conditions continue to decline. Will we see similar price action we saw last Tuesday; a big spike higher followed by failure? I still think the best MO for trading this market is to fade the inter-day extremes (not to be confused with intra-day) for short term trading opportunities.
Daily Support & Resistance for 11/19
Dec Chgo Wheat: $5.01 – $5.15
Dec KC Wheat: $4.15 – $4.26
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.