Morning Futures Roundup
When Will Good News Come for Wheat Bulls?
Fundamentals
Wheat prices have been unable to follow other grain prices higher under the weight of the large crop. Russia had exported a record large crop in the month of August, and Australia is currently saddled with a record crop size. Kansas Wheat plantings were 69% done, and about 35% of the winter crop has already emerged. Nationally, the winter Wheat crop is 59% seeded, which is behind the 5-year average of 67%. Given the already large supply, the slower than expected planting progress is not anticipated to have a positive impact on prices. The problem the Wheat market now faces is finding a buyer to work down the stockpiles.
Technical Notes
Turning to the chart for December Wheat, we see prices continuing to hang around support near the 600 level. Prices were unable to gain momentum above the 650 level, which is a minor, near-term resistance level. It is interesting to note that the RSI indicator has turned higher, while prices remained flat. This can be seen as a positive indicator, but the timing of a potential move higher is unknown.
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About Mike Zarembski
Born in the grain pits of the Mid-America Commodity Exchange (MidAm) in the early 1990s, Mike's futures career soon shifted to the offices of TD Waterhouse in 1999, followed by Xpresstrade in 2002 and eventually optionsXpress in 2007.
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