May Chgo Wheat closed 1 ¼ cents higher ($4.99 ¼), July ½ cent higher ($5.00) & Sept ¼ cent higher ($5.05 ¾)
May KC Wheat closed 8 ½ cents higher ($4.32 ¼), July 7 cents higher ($4.38) & Sept 6 ¼ cents higher ($4.46 ¾)
May Mpls Wheat closed ½ cent lower ($5.09 ¼), July ¾ cent lower ($5.18 ¾) & Sept 1 ¼ cents lower ($5.28 ½)
Technical bottom picking was the feature in US wheat futures on Tuesday. The weakest of the varieties, the KC market, saw the best buying. Stabilization in the equity market, at least staying on the plus side for the majority of the day, helped facilitate the bottom picking. Normally the spike higher in the US dollar would suppress this market but given the break recently seen allowed for the bottom picking.
Like all of the other AG markets farmer selling is non-existent yet basis levels don’t do a whole lot. Modest bull spreading was featured in both Chgo and KC which I think was tied to the bottom picking.
I may be in left field with this idea but my personal opinion is that the wheat market has the least amount of downside for the near term. Yes, we can still move lower but we still have technical support below current levels in the form of lows made in the past 12 months that we have yet to take out. The current price action is trying to suggest something may be developing but we will stayed tied to the goings on in the equity markets and its related “risk-off” stance.
Daily Support & Resistance – 3/18
July Chgo Wheat – $4.90 – $5.10
July KC Wheat – $4.28 – $4.48
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.