Technically Speaking

Weekly Analysis: Wheat Markets

Darin Newsom
By  Darin Newsom , DTN Senior Analyst
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Source: DTN ProphetX

SRW Wheat (Cash): The DTN National SRW Wheat Index (SR.X, national average cash price) closed at $4.41 3/4, up 23 cents for the week. The SR.X is in a secondary (intermediate-term) uptrend on its weekly close-only chart. The SR.X is testing resistance at $4.42 1/4, a price that marks the 38.2% retracement level of the previous downtrend from $6.01 1/4 through the low of $3.44. Next resistance is at the 50% level of $4.72 3/4. However, weekly stochastics have already climbed above the overbought level of 80%, possibly limiting new buying interest.

SRW Wheat (New-crop Futures): The Chicago July 2017 contract closed at $4.65 1/4, up 19 1/2 cents for the week. The contract still looks to be in a secondary (intermediate-term) sideways trend. However a clear break of resistance at $4.72 3/4, a price that marks the 67% retracement level of the previous downtrend from $5.85 1/2 through the low of $4.16, would suggest an extended rally to the 67% retracement level at $5.29 3/4. This would also be a test of major (long-term) resistance of $5.22 1/2. Recall that the market's major trend remains up.

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HRW Wheat (Cash): The DTN National HRW Wheat Index (HW.X, national average cash price) closed at $4.07 1/2 up 28 1/4 cents for the week. The cash HRW market remains in a secondary (intermediate-term) and major (long-term) uptrend. Next major resistance is at $4.23 1/4, a price that marks the 23.6% retracement level of the previous downtrend from $8.88 1/2 through the low of $2.79 3/4. The 33% retracement level is up at $4.80 1/2.

HRW Wheat (New-crop Futures): The Kansas City July 2017 contract closed at $4.73 1/2 up 22 cents for the week. The secondary (intermediate-term) trend of July KC futures remains up with next resistance pegged at $4.90 1/2. This price marks the 50% retracement level of the previous downtrend from $5.70 through the low of $4.11 1/4. The 67% retracement level is all the way up at $5.17 1/4.

HRS Wheat (Cash): The DTN HRS Wheat Index (SW.X, national average cash price) closed at $6.01 1/4, up 38 1/4 cents for the week. The market extended its major (long-term) uptrend last week, testing resistance at $5.96 3/4. This price marks the 23.6% retracement level of the previous major downtrend from $11.37 through the low of $4.30. With monthly stochastics climbing above the overbought level of 80%, cash spring wheat's rally could be limited to a test of next resistance at the 33% retracement lev of $6.65 1/2.

HRS Wheat (New-crop Futures): The Minneapolis September 2017 contract closed at $6.47, up 36 cents for the week. The contract remains in a strong secondary (intermediate-term) and major (long-term) uptrend. Last week's rally saw September Minneapolis move above major resistance at $6.31 1/4, with the next target $6.93 1/4. The latter marks the 33% retracement level of the previous major downtrend from $11.20 through the low of $4.80 1/4. However, monthly stochastics are nearing the overbought level of 80%.

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