Wheat correction over for now?

[farming101]

ZWK action today encouraging. Look for a couple days closing price above 508 3/4
510 3/8 high for today so far

[farming101]

I stand corrected. A very rough estimate shows the Grainco's only kept 28% of the exchange week/week

KEK20 is in the buy signal area. Need confirmation tomorrow. The problem is with the quick increase (about 8.5% in three days) the price might not touch an entry area trigger till the rally is half over. In addition tomorrow is Friday. Expect traders to even up positions. Nobody with limited resources/no actual stocks will be eager to stay in the market over the weekend.

Chicago rally a bit weaker and Minneapolis weakest at the moment

Update: Chicago has now joined with a buy signal and MW not far behind. When I say buy signal I mean it's time to pay attention. Not necessarily time to buy

[farming101]

Everything is possible and nothing is possible in this environment

ZWN20 could be 30% up by third week of May.

First though, the May contract still needs to rise above 5.77 and 5.87 to leave the downtrend behind

[AlbertaFarmer5]

Just replying to note that some of us are reading and really appreciating the posts on this thread.

Just because you're excellent analysis may go uncommented, doesn't mean it is unread or unappreciated


Thanks for sharing.

[farming101]

For sure.
While I don't mind putting some price destinations out there based on chart patterns I don't think I could ever recommend what guys do with their actual stocks. Totally up to them.
Just kind of a heads up: this is happening today kind of thing

[TechAnalyst]

It is worth noting that the Chicago wheat futures went inverted on Friday and built on that today. For those not sure, what that means is the March futures are now a premium to the May futures (instead of the normal discount for the cost of carrying the inventory to May). That is a bullish sign as it shows the need for inventory sooner rather than later.

I thought it would be worth bringing this forward given the inversion still exists. The May is trading at a 7 cent premium to the July, indicating the need for inventory sooner rather than later.

In the big picture, a commercially driven rally is far more powerful than a spec rally. I suspect that will be the case here as well.

AF5, I'm not sure if that was directed at me as well but if so, I'm glad to help if I can. If I'm doing the analysis anyway, why not share.

[Oliver88]

How would you guys tackle selling wheat for June/July delivery?

Futures seem to be increasing. CDN $ fluctuating but heading down with oil. Grain companies adjusting basis and protein spreads randomly.

I plan to simply use a target for a fixed price but do get tempted to lock in basis than lock in futures later.

[TechAnalyst]

I'm not a huge fan of basis contracts unless they're exceptionally favourable. Especially with volatile futures markets and time constraints. You really are left with little for a plan B should the futures pull back and don't recover in time.

I do believe the saucer on the monthly Chicago wheat chart and the inversion in the futures both point to a rally into the summer. The Can$ should continue to struggle as long as energy and equity markets remain under pressure.

Given that, I would prefer to use target prices to reward a rally with a portions of the total sales to be made along the way. That reduces the stress, obtains a favourable average price as long as the rally unfolds, and leaves an endless amount of plan B options should something derail the rally.

Hope that helps.

[Oliver88]

Incremental targets for flat price do make sense for June/July as well as new crop.

[farming101]

Everything is possible and nothing is possible in this environment

ZWN20 could be 30% up by third week of May.

First though, the May contract still needs to rise above 5.77 and 5.87 to leave the downtrend behind

ZWK20 backing off from 5.77. High of 5.76 5/8 so far. Lots of energy though, could still break through or maybe tomorrow...
The inversion Tech mentioned is growing

Done, 5.87 next resistance...support at 555 1/4