Technically Speaking

Chart Analysis: US Wheat Prices

Todd Hultman
By  Todd Hultman , DTN Lead Analyst
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The chart above of weekly December KC wheat prices shows noncommercials and managed futures funds modestly net short, an expression of bearish sentiment related to plentiful supplies. KC wheat prices however, are historically cheap, showing signs of support near their lowest December prices in 13 years (DTN ProphetX chart).

December Kansas City Wheat:

December KC Wheat gained 7 3/4 cents last week, ending at $4.07 1/2 on Friday and putting a little more distance between Friday's price and this year's $3.81 low. Friday's Commitments of Traders report showed noncommercials and managed futures funds modestly net short, which is understandable as both U.S. and world ending wheat supplies are at historically high levels. Technically however, December prices appear to be finding support near their lowest levels in 13 years and the weekly stochastic has turned up -- a bullish change in momentum. It is difficult to expect a new bull market for KC wheat prices yet, but support for a new trading range seems reasonable as we get started in a new planting season for winter wheat.

December Chicago Wheat:

December Chicago wheat was quiet last week, ending up just 3/4 cent on the week to rest at $4.84 1/4 on Friday. On a daily chart, the trend remains down and prices are staying below resistance from the 100-day average at $5.00. On a weekly chart, trader positions are roughly neutral and support for this year's smaller SRW wheat crop is seen in how December prices are holding above the 2019 low of $4.42 1/4, set back in May. I expect that support level to hold into winter and a wide, sideways trading range for Chicago wheat seems likely, at least until March 2020.

December Minneapolis wheat:

December Minneapolis wheat closed up 18 3/4 cents last week, finishing at $5.24 1/4 cents. That was the largest gain of the three U.S. wheats last week and was helped by increasing concerns of crop damage from excess rain on fields of unharvested wheat. Also helping the rally, Friday's CFTC data showed noncommercials and managed futures funds holding record levels of net short positions -- a potentially bullish feature discussed in this space Aug. 12. Like the other two wheats, the weekly stochastic has also turned higher as Minneapolis wheat prices rebound from their lowest levels in 12 years. There is no fundamental argument for a new bull market in spring wheat, but support for a new trading range into winter is reasonable.

Comments above are for educational purposes and are not meant to be specific trade recommendations. The buying and selling of grains and grain futures involve substantial risk and are not suitable for everyone.

Todd Hultman can be reached at

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(BAS/ CZ )


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