Sept Chgo Wheat closed 7 ¾ cents lower ($4.86), Dec 8 cents lower ($5.13 ¾) & March 7 ½ cents lower ($5.35)
Sept KC Wheat closed 11 ¼ cents lower ($4.90 ½), Dec 11 ¼ cents lower ($5.16 ¾) & March 10 ¾ cents lower ($5.39)
Weekly Wheat Export Sales – old crop vs. 200-500 K T. expected – new crop vs. none expected
Overnight Russia reiterates what it said on Monday – no plans to enact export curbs. With that said the recent spec liquidation run continues. As I mentioned yesterday I thought it was very telling in the Egyptian tender that Egypt was unwilling to pay up. This suggested to me that as long as Russia stays what appears to be aggressive with their marketing there is no way the US can compete. Anyone that thought better business was on its way to the US sooner vs. later is now looking at losing positions if they bought it after July 19th.
This is getting to sound like a broken record – advertised cash basis bids for wheat, both domestic and export, are seeing no changes. Spreads are showing a bearish bias along with the liquidation in the flat price.
As long as the US has no market making business one of the functions of the futures’ market is to go and find some. How does it do that – with lower prices!! I may be dead-ass wrong but today’s price action looked like a bear trap. If I am wrong last week’s attempt to rally followed by this week’s failure measures to $4.90 (Dec Chgo). A move to that level (the July 11th low) would most certainly clean house on any remaining spec longs.
Daily Support & Resistance for 09/07
Dec Chgo Wheat: $5.10 – $5.22
Dec KC Wheat: $5.13 – $5.27
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.