While spring wheat futures have struggled to follow the recent moves seen in the winter wheat markets, the weekly MGEX spring wheat chart has flashed some positive technical signals this week.
After reaching the May contract's lowest point in eight months this week at $6.08/bushel, double-digit moves higher on Wednesday and Thursday followed by profit-taking on Friday has led to a 7-ent gain over the week, the largest weekly gain in eight weeks. This week's trade formed a bullish outside-week reversal bar on the May chart, trading both higher and lower than the range seen in the week prior and confirmed by Friday's higher weekly close.
In addition, the Feb. 26 weekly high of $6.36/bu. reached the highest level trading in seven weeks, with a four-week high being a technical sign of a potential change in trend.
The middle-study points to supportive commercial buying interest over the week, with the brown line showing the May/July spread narrowing by 2 1/4 cents over the week to minus 7 1/2 cents. While not shown, CFTC data as of Feb. 27 shows investors or noncommercial traders paring their bullish net-short position for the second straight week to 897 contracts, the smallest net-short held in three weeks.
The lower-study points to bullish crossover stochastic momentum indicators on the weekly chart while in oversold territory, also signaling what could be a move into an uptrend on the weekly chart.
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