Funds and commercials have been sort of yoyoing in their views: funds reduced then added then again this week reduced their longs. Commercials have been happy to accomodate them. Price action this week was clearly bearish but I'm not prepared to say "bear market." July will be hoping for support around 665 and looking for support just above 600. December has been less volatile, as is normal for new year crops compared with old year. December looks like it will go down, but around 600 (it is now 640) I expect to see buying coming in.
About mid-February funds began reducing their long positions. Although it has been a sometimes thing, the last four weeks have all seen significant reductions in the long positions of funds and of the short position of commercials. Price action looks like a meander has set in. This could carry as low as 1200 basis July; While not as large a drop as July, November may see 1200 hold as well.
July whean certainly looks to be headed for 700, where it should encounter stickiness. The commercials have flipped to net long on the CoT, along with the funds who are slightly long. That means the short side is carried by small speculators and farmers. December wheat is priced considerably higher than July, and looks like it wants to get down to maybe 750 - 760.
I still don't understand where the world's grain is coming from this year. Chinese wheat fields certainly won't be up to 100%, nor, it seems, will Ozzie (yeah, that's how I've seen Australians refer to themselves) fields. Russian fields will fill the gap, no doubt (now that's baloney, if ever there was any). What I see of the weather suggusts that the worlds best farmers, Americans, haven't learned to control Mother Nature yet, and are having pretty poor weather. Neither do I understand where beans and corn will come from. To be sure, South American crops seem to be fine, but not anywhere near the fantastic yields that will be needed if we don't see dramatic improvement in American fields & weather soon.
Of course, all I know is what the charts tell me, even when I think they are a bit bonkers, as I do now, so FWIW that's that.
I will do another analysis of who holds what in crude in the next few days. We have seen dramatic drops, even though Libya is no better than it was, nor is Bahrain or Syria or...