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Wheat Market - Just My Opinion

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Flat price wheat struggles to rally it breaks so easily. That holds true with the flat price trading as well as the inter-market spread trading. That suggests to me the best we have to look forward to is the development of a trading range affair. US wheat direction will continue to be dominated by Black Sea prices. Dec Chgo wheat came with 2 cents of its contract lows on Wednesday not a good sign.

Interior cash wheat remains quiet. Bids for SRW at the Gulf dont do much. Chgo wheat spreads appear to be on the defensive. If I didnt know better it seems like we have some players/spreaders fighting to keep wheat spreads wide in turn keeping storage rates expensive. Friday the 24th is the last day for calculating the new VSR. KC spreads inch back wider on Wednesday. The bid for HRW at the Gulf still looks pretty decent but fails to attract any attention. That would suggest slow movement and/or a lack of exportable protein wheat.

3-4 days ago the talk was US wheat futures were trying to carve out a low. Just 2 days ago the price action took on a look of an upflag. After todays price action that upflag appears to be rolling over. Intra-market spreads are rolling over inter-market spreads are rolling over. Daily momentum indicators are rolling over. Do I need to say anything more as to this markets direction? As I mentioned earlier the best thatcan be hoped for is the development of a new sideways trend at these new lower prices.

Daily Support & Resistance for 11/16

Dec Chgo Wheat: $4.20 - $4.38

Dec KC Wheat: $4.22 - $4.40

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About the author

Tom Fritz is a third generation commodity futures trader. His grandfather and his father were traders on the exchange. Tom began his career in 1971 with Tabor Grain which was later acquired by Archer Daniels Midland. Prior to co-founding IFG in 1994 Tom was the lead Chicago Board of Trade floor analyst for ADM. He produces Just My Opinion, a daily grain commentary that is well respected and viewed all over the world.



Contributing author since 11/7/2017 

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