May Chgo Wheat closed 4 cents higher ($5.47), July 1 cent higher ($5.44 ¾) & Dec ¼ cents lower ($5.52 ½)
May KC Wheat closed 4 ½ cents lower ($4.85 ½), July 4 ½ cents lower ($4.93 ¼) & Dec 4 ½ cents lower ($5.09 ½)
May Mpls Wheat closed 1 ¾ cents higher ($5.05 ½), July 3 ¼ cents higher ($5.19 ¾) & Dec 3 cents higher ($5.43)
Weekly Wheat Export Sales – 244.7 K T. old crop vs. 100-350 K T. expected – 155.2 K new crop vs. 200-500 K T. expected
It was a mixed trade for US wheat futures today; Chgo higher, KC lower and Mpls higher. Weekly export sales were deemed no big deal. It was interesting to note that within the Chinese story about restocking state reserves wheat was not mentioned. The stories involving wheat have not changed. Concerns are still being mentioned about dryness in the EU and Black Sea regions. We know US acres are down, EU acres are down and earlier this week Russia downgraded their crop by a couple of million tons. It remains my opinion that the wheat trade will be now worse than a mixed choppy trade until more is known about the developing winter crop in both the US and abroad.
Advertised cash (basis) wheat prices don’t change. This hold true for Gulf values as well. 1st Notice day against the May contract is next Thursday. The $64 K question is Chgo deliveries. Will they bring in hard varieties to satisfy the CBOT soft contract? Bull spreads were working in Chgo, KC spreads were flat and Mpls shoed a bearish bias out to September and then bull spreading took over.
As I mentioned the other day the wheat price action has moved into a consolidation mode. As long as that’s the case trading should be limited to fading short term inter-day extremes. I will admit my bias is to play it from the long side on breaks to suspected support levels.
Daily Support & Resistance – 4/24
July Chgo Wheat – $5.35 – $5.55
July KC Wheat – $4.85 – $5.05
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.