CBOT Wheat Futures

[AlbertaFarmer5]

All the commodities seem to be trending upwards, its difficult to pick a top in a single commodity

If these up trending markets are simply a manifestation of inflation, rather than reflecting fundamental supply and demand, then picking the top is about as futile as picking the corner on a sphere.

[errolanderson]

Heads up . . . bearish reversal in Chicago today.

[TechAnalyst]

Heads up . . . bearish reversal in Chicago today.

It does bear watching but at this point it appears to be simply profit taking ahead of the holiday (that I mentioned in a previous post). Other clues that I follow suggest the bull market is still alive and well.

The action to start next week will be key. A weak close Monday may be the start of the correction wheatking has been looking for.

If so, not a bad level to sell a bit to reward the bull (for those looking for a reason to).

[errolanderson]

An opinion from Australia . . . .

Lock in your Wheat price.

Yesterdays outside bearish reversal aides my Short Call on Wheat.

Currently trading at $8.50 on CBOT,
Looking for an initial downside target into the $7.81-$7.67 range.
$7.75 to be specific.

The medium term target surrounds the $7.12 area.

November 25, 2021
Rob Zdravevski

[farming101]

Chicago closed a fair bit off the .382 so that's good. However could be some attempts at .500, 8.20 or so based on the last couple trading days.
MW/ZW is over 200 again so what do I know...
Maybe the bulls stayed out at the cabin/lake/beach and the bears were doing the driving today

[farming101]

Outside day lower
500 retrace was at 818 1/2, low was 818 3/4. Turn around Tuesday?

[farming101]

NOPE!

[AlbertaFarmer5]

NOPE!

At what point does this go from being a correction within a bull market, to something else?

[farming101]

At what point does this go from being a correction within a bull market, to something else?

762 1/2 which fits with Errol's post above. This needed level for support will rise with time. Then you start looking for patterns like double tops, head and shoulders, etc.
Even then it could be called a soft landing although no one is going to like it. Some will say it went up too fast too soon. I would agree with that assessment. Remarkable that the 8.70 level held it. Possibilities for a more measured advance lasting through the winter. Good local pricing opportunities will likely move to specials with basis doing the heavy lifting. The feed market will underpin the market in western Canada.
Remember too, this is the Chicago contract. Although MW is not immune it is holding in better with a lot less stocks to make it to new crop. March spread between pits is now 234 MWH/ZWH. I'll readily admit I didn't think that would happen, which means I didn't think Chicago wheat would pull back this much.

[TechAnalyst]

At what point does this go from being a correction within a bull market, to something else?

I agree that the damage done doesn't appear to be lethal to the bull yet. And that with Chicago having a greater spec interest, it was far weaker during the liquidation. Kansas and Minneapolis hard wheats have faired much better.

In the short term, once the targets are hit (8.70 in this case), it is much more difficult to accurately predict what will happen. The selloff was severe enough I would expect a bounce to start the month. I agree with Farming that the rally will have to be watched for signs of a short term top.

In the long run, wheat still looks great on the weekly and monthly charts. The saucer on the monthly chart remains the guiding formation suggesting we are likely to see strong wheat markets through 2022 (unfortunately likely fueled by droughts).

My 2 cents worth.