Dec Chgo Wheat closed 7 ½ cents higher ($5.08), March 6 ¾ cents higher ($5.22 ¾) & July 6 ½ cents higher ($5.40 ½)
Dec KC Wheat closed 8 cents higher ($5.01 ¼), March 7 ½ cents higher ($5.25 ½) & July 7 ½ cents higher ($5.47)
Weekly Wheat Export Sales – 582.5 K T. old crop vs. 200-500 K T. expected – no new crop vs. none expected
Flat price wheat picks up where it left off on Wednesday with additional short covering. There is however decent rationale to go with the rally – bull spreads had been working while the market was breaking down earlier this week – Weekly export sales are beginning to show improvement – the Russian watchdog group wants to suspend loadouts at 5 locations in Rostov (Black Sea port). Last but not least a dramatic break in the US Dollar worked to keep the wheat markets relatively firm for the majority of the session.
In recent days we have seen the nearby spreads in Chgo and KC showing signs of improvement (bullish) while the interior cash markets have not shown much. I just saw the Goodland, KS basis improve for the first time dating back to September. The export basis for both SRW and HRW continue to show a firm bias.
It seems yesterday’s hard midday break was just some short fund dressing for month-end as the late short covering rally and today’s follow through suggests US wheat futures have gone low enough for now. It’s been a while since most of the current wheat news has had a friendly bias. We may trade back and forth for the near term but as long bull spreads/cash prices have a bias to improve attempts to sell off the flat price should find support.
Daily Support & Resistance for 11/02
Dec Chgo Wheat: $4.96 – $5.14
Dec KC Wheat: $4.92 – $5.10
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