Price action: December SRW wheat dropped 36 1/4 cents to $6.91 3/4 and nearer the session low. December HRW wheat closed down 39 3/4 cents at $8.29 1/2. Prices closed nearer their session lows and hit two-week lows today. September spring wheat futures fell 40 1/4 cents to $8.55 3/4 and closed near the session low.
Fundamental analysis: Big losses in corn and soybean futures spilled over into the wheat markets today. Weak long liquidation to end the month of July was featured in the grain markets. Traders continued to remove risk premium from futures prices amid a pause in attacks in the Black Sea over the weekend and notions Ukrainian grain can flow out of the country via land routes. Seasonal winter wheat harvest pressure and commercial hedge selling remain seasonally bearish elements.
USDA this morning reported U.S. wheat export inspections of 581,278 MT during the week ended July 27, which were up 220,143 MT from the previous week and well above trade expectations. The inspections pace is still slightly behind last year’s but did catch up significantly after today’s numbers.
World Weather Inc. today reported northern Plains temperatures will be close to normal the next two weeks, although there will be some warm and cool days. Scattered showers and thunderstorms are expected in the region, “but they will not be frequent or significant enough to seriously bolster soil moisture. They will be timely in some fields. proving beneficial to some crops. A more generalized rain will be needed especially in the east,” said the forecaster.
This afternoon’s USDA crop progress reports are expected to show the U.S. spring wheat crop in 48% good to excellent condition as of Sunday, versus 49% last week. The winter wheat harvest is expected to be 79% completed as of Sunday, compared to 68% last week.
Technical analysis: Winter wheat futures bulls have lost their overall near-term technical advantage and the bears have momentum. SRW bulls’ next upside price objective is closing December prices above solid chart resistance at $7.50. The bears’ next downside objective is closing prices below solid technical support at the July low of $6.41 1/2. First resistance is seen at $7.00 and then at today’s high of $7.26 3/4. First support is seen at $6.80 and then at $6.70. The HRW bulls’ next upside price objective is closing December prices above solid technical resistance at $8.90. The bears’ next downside objective is closing prices below solid technical support at $8.00. First resistance is seen at $8.50 and then at $8.70. First support is seen at $8.20 and then at $8.10.
