March Chgo Wheat closed 3 ¼ cents lower ($6.72 ¼), May 3 cents lower ($6.73 ½) & July ½ cent higher ($6.58 ¼)
March KC Wheat closed 1 cent higher ($6.44), May 1 cent higher ($6.47) & July ¾ cent higher ($6.46 ¼)
March Mpls Wheat closed ¼ cent higher ($6.43 ½), May ¼ cent higher ($6.52) & July 1 ¼ cents higher ($6.57 ¼)
Weekly Wheat Export Inspections – 276.9 K T. vs. 200-400 K T. expected
Flat price US wheat tries to trade higher following overseas prices but the absence of any decent direct US exports prompts rounds of trade selling on sharp advances. Today’s trade was quite similar to what we saw last Friday; sharply higher only to see a good portion of the gains erode away. Weekly export inspections, along with sales, continue to be no big deal. If the US is to see any uptick in exports I have to think the hard varieties will benefit the most.
The interior wheat basis doesn’t do much. The Gulf basis is steady to firm for HRW. I’m still trying to figure out the recent 15 cent jump in the gulf SRW basis considering I’m not seeing much noticeable business around. The nearby spread in Chgo eased fractionally while old crop gave it back to the new crop. KC spreads ran flat with no change up front nor against the new crop.
OK – world prices are moving higher and we follow suit despite very little business. I believe what we are seeing is called “betting on the come” meaning the business will eventually come but we can’t get too far ahead of ourselves. Wheat charts remain strong looking but there is always room for correction. Buying sharp breaks to suspected support levels seems like the proper MO for trading as one of these days the intra-day rally is not going to fade.
Daily Support & Resistance – 01/20
March Chgo Wheat : $6.64 – $6.86
March KC Wheat: $6.35 – $6.55
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