Technically Speaking

Weekly Analysis: Wheat Markets

Source: DTN ProphetX

SRW Wheat (Cash): The DTN National SRW Wheat Index (SR.X, national average cash price) closed at $4.33, down 8 cents for the week. Cash SRW wheat's weekly close only chart is showing a clear secondary (intermediate-term) 3-wave downtrend, with last week's sell-off a decisive move into Wave C (third wave). Given the Wave A low of $4.21, a test of support at $4.22, Wave C would be expected to bottom out between $4.13 and $4.01. The most recent signal by weekly stochastics was a bearish crossover above the oversold level of 80% the week of March 5 2018, shortly after the Wave 5 peak of $4.63 of the previous uptrend.

SRW Wheat (New-crop Futures): The Chicago July 2018 contract closed at $4.76 1/4, down 12 cent for the week. The contract continues to consolidate above support at its recent low of $4.59, though a bearish breakdown is growing more likely. If this support gives way the contract could look to test its low of $4.37.

HRW Wheat (Cash): The DTN National HRW Wheat Index (HW.X, national average cash price) closed at $4.44, down 12 cents for the week. Cash HRW remains in a secondary (intermediate-term) downtrend on its weekly close-only chart. Initial support is at the previous low weekly close of $4.26 (week of March 26), then $4.17 and $4.00. The latter prices mark the 50% and 61.8% retracement levels respectively of the previous uptrend from $2.90 through the $4.86 high.

HRW Wheat (New-crop Futures): The Kansas City July 2018 contract closed at $5.02, down 12 1/2 cents for the week. July KC wheat is nearing a bearish breakout, a pattern that would be confirmed with a move below its recent low of $4.94 3/4. If this occurs the contract could look at testing its low of $4.75 1/2.

HRS Wheat (Cash): The DTN HRS Wheat Index (SW.X, national average cash price) closed at $5.97, down 17 cents for the week. The secondary (intermediate-term) trend for cash spring wheat could still be considered sideways. Though it has moved outside its previous range from $5.82 to $6.05, it remains within the wider range between $6.19 (close the week of November 6, 2017) and $5.62 (week of March 26). A breakout in either direction should establish the next trend.

HRS Wheat (New-Crop Futures): The Minneapolis September 2018 contract closed at $6.11 1/2, down 18 3/4 cents for the week. The contract looks to be in a wide ranging sideways pattern between the recent low of $5.88 1/4 and the recent high of $6.47.

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