Sept Chgo Wheat closed 9 cents lower ($4.93 ¾), Dec 9 ¾ cents lower ($5.21 ¾) & March 9 cents lower ($5.42 ½)
Sept KC Wheat closed 6 ¼ cents lower ($5.01 ¾), Dec 9 cents lower ($5.28) & March 8 ½ cents lower ($5.49 ¾)
Egypt announces an overnight tender for optional origin wheat – Egypt buys 60.0 K T. Russian wheat
Flat price wheat tries to rally Tuesday night on the idea that US wheat may be offered at the overnight Egyptian tender. Once again the tender was dominated with Russian origin with the only competition being one cargo from Romania. Twelve cargoes were offered and Egypt only took one. The one cargo they took was a few dollars cheaper vs. what they bought early last week. The remaining offers were noticeably higher. It looked like Egypt, one of the more prominent wheat importers, was not ready to pay up at this time. All of this was perceived as bearish. The bottom line is that spec longs in the different wheat markets continue to liquidate due to the poor price action.
Interior cash wheat markets remain quiet. US export markets for wheat remain quiet. Wheat spreads in both Chgo and KC leaked wider with the spec liquidation in the flat price.
Funds/specs are long in anticipation of better business. So far that better business has yet to appear. The price action is suggesting we may see further probing of suspected support levels below current price levels. I still think we have the potential for higher prices down the road but experience has taught me moves don’t happen when everyone is on board waiting for it to happen.
Daily Support & Resistance for 09/06
Dec Chgo Wheat: $5.15 (?) – $5.30
Dec KC Wheat: $5.22 (?) – $5.40
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.