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Commentary
It is my opinion that technical momentum continues to carry higher as managed money funds buy back their shorts in the wheat market. December Wheat finished up 6.6 cents, ¼ penny off the high and 10.4 cents up from the low. March Wheat closed up 5.2 cents. This was 9.4 up from the low and ¼ penny off the high. The 100-day moving average was crossed yesterday in December Chicago wheat @ 5.37 and defended as new support today, emboldening more long money to follow the firmer close in my opinion. The “China is looking for wheat” rumor hasn’t subsided like some other rumors passed around yesterday so there are potential fundamental reasons for the higher market too. While there is still no confirmation of any Chinese purchases but price action over the last few sessions suggests some export business has been done in my view. The fact the wheat is holding firm in the face of a selloff in beans and corn is strong sign that the technical situation has shifted in wheat to the bull side for now.
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Sean Lusk
Vice President Commercial Hedging Division
Walsh Trading
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