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Commentary

Wheat prices continue to find support from escalating risks in the Black Sea Region and finished the day in the green. Markets appeared listless and choppy to begin the day session once again in what seemed to be a sideways day of trade, but headlines entered into the market and futures prices went bid mid-morning and closed within a few cents of the highs. It is my opinion that today’s finish higher can be attributed to reports that on a call between Trump and Putin, Putin “vowed retaliation” against Ukraine’ follows the attacks over the weekend with short covering in wheat being the result. All sides continue to schedule peace talks and all the while continue to execute drone strikes against the other signaling, we are far from any peace deal. Egypt announced it was securing contracts with strategic partners including France and Romania this week as the World’s number one wheat buyer diverges from reliance on Russian supplies maybe due to military escalations. Other bullish tidbits included stories about China’s hot/dry weather in the wheat belt that found their way into the news feeds, but the losses, if any, are almost impossible to verify. Technical levels come in as follows. For chicago wheat. Funds short approximately 100k. Support is down at 5.24. A close under and its 5.06. A close under there and its 4.97 which is 10 percent down for the year. A clos eundr and its 4.86, major trendline support. Resis tance is up at 551/554. Closes above here push the market to 563. A close above her and the market could run to major resistance levels. 100 week moving average at 578, and two key trendlines at 579/580. 

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Sean Lusk

Vice President Commercial Hedging Division

Walsh Trading

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