Wheat, corn and cattle close higher Thursday.
Wheat rallied for a 6th day on continued fund short covering and short profit taking. Alan Brugler, Brugler Marketing, says, “You broke out of a multi-month downtrend channel in Kansas City wheat charts starting in April.”
However, he says the market continues to add war and weather premium.
How much longer can wheat sustain this rally? Brugler thinks there may be upside of another 30 to 40 cents, “An old technical indicator is that you try to double the channel. We are getting up towards that doubling point on the Kansas City you’re getting a little overbought, but you’ve got some pretty good fundamental support.”
If wheat keeps moving higher, will it be able to pull corn above overhead chart resistance? Or does corn have its own emerging story?
Brugler says corn needs the help of the wheat market, but he points to improving fundamentals including demand.
He says weekly exports have continued to run above USDA’s export pace and above last year by 20%.
Live and feeder cattle futures reversed a lower opening and saw nice recovery with the help of steady to higher cash.
Southern live cash trade was mostly steady at $182, with some $183 sales. The Northern dressed prices were $2 to $3 higher at $294 to $295 and there were also some $185 live sales.
Brugler says the market overreacted to the news of USDA requiring testing for interstate movement of dairy cattle and so it also saw a technical bounce.
