Price action: December SRW wheat fell 2 1/4 cents at $6.84 1/2, near the session low today and hit a two-week low. December HRW wheat dropped 6 3/4 cents to $8.01 1/2, near the session low. December HRS wheat rose 7 1/4 cents to $8.35.
Fundamental analysis: The winter wheat futures markets were again pulled down by another solid drop in corn futures prices. Weekly U.S. wheat sales were also disappointing, at 155,200 MT reported for 2023-24, were near the low-end of market expectations. Seasonal harvest hedge pressure is also a bearish element for the winter wheat futures markets.
World Weather Inc. today reported “concern continues over crops in Canada’s Prairies due to dryness. Portions of North Dakota and northeastern Montana also need rain. The remainder of the northern U.S. Plains have seen timely rainfall that is benefitting spring wheat, barley and oat development.” Wheat maturation and harvest conditions have been fair to good recently in the central United States; including hard red winter wheat areas and soft wheat in the Midwest. Wet weather coming to the Midwest this weekend into next week could slow crop maturation and harvesting and may raise some crop quality concerns, said the forecaster.
Traders are awaiting Friday morning’s USDA quarterly grain stocks report and planted acreage updates. These reports have a history of producing surprises and higher price volatility in the immediate aftermath of their releases.
Technical analysis: This week’s price action produced bearish V-Top reversal patterns in SRW and HRW. Bears have the overall near-term technical advantage. 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 $6.50. First resistance is seen at $7.00 and then at Wednesday’s high of $7.22 1/2. First support is seen at $6.75 and then at $6.60. The HRW bulls’ next upside price objective is closing December prices above solid technical resistance at the January high of $8.93. The bears’ next downside objective is closing prices below solid technical support at $7.75. First resistance is seen at today’s high of $8.17 1/4 and then at $8.25. First support is seen at $7.90 and then at $7.80.
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