Price action: December SRW wheat surged 59 3/4 to $7.77 1/2 and closed at a five-month high close. December HRW wheat gained 58 1/2 cents to $9.25 1/4 and hit an eight-month high. Both markets closed near their daily highs and near limit-up. September spring wheat futures rallied 49 cents to $9.36.
Fundamental analysis: The wheat futures markets surged today as the Russia-Ukraine war escalates, with Russia attacking more Ukraine grain facilities, while Ukraine strikes back with drone attacks inside Russia’s border. Scorching Corn Belt weather that boosted the corn and soybean markets also spilled over into buying interest in wheat markets today.
USDA this morning reported U.S. wheat export inspections of 358,796 MT, which were up 85,621 MT from the previous week, and above market expectations. However, wheat inspections are still behind last year’s inspections pace.
This afternoon’s weekly USDA crop progress report is expected to show the U.S. spring wheat crop in 51% good to excellent condition, which is the same level as last week. U.S. winter wheat harvested is expected to be 70% complete as of Sunday, compared to 56% complete the prior Sunday.
Technical analysis: Winter wheat futures bulls have the firm overall near-term technical advantage. SRW bulls’ next upside price objective is closing December prices above solid chart resistance at $8.00. The bears’ next downside objective is closing prices below solid technical support at $7.00. First resistance is seen at the June high of $7.84 1/4 and then at $8.00. First support is seen at $7.50 and then at $7.35. The HRW bulls’ next upside price objective is closing December prices above solid technical resistance at $10.00. The bears’ next downside objective is closing prices below solid technical support at $8.50. First resistance is seen at $9.35 and then at $9.50. First support is seen at $9.00 and then at today’s low of $8.67.
