Wheat Futures—Wheat futures in the May contract is lower by another 13 cents at 4.49 a bushel under pressure for the 2nd consecutive trading session hitting a 4 week low.
The grain market in general continues to grind lower as there is nothing bullish about the agricultural sectors at this time as we await for some type of trade agreement with China which now seems months away.
The Russian wheat crop is larger than what was expected putting pressure on prices this week as it does look to me that we will retest the March 11th contract low of 4.35 possibly this week. If you are short a futures contract I would place the stop loss above the 2 week high which stands at 4.80 as an exit strategy as there still looks to be further weakness ahead.
Wheat is now trading below its 20 and 100 day moving average telling you that the trend is to the downside as the volatility is also starting to increase and that will continue to escalate to the upside once the summer months are upon us which is just around the corner.
For the bullish momentum to continue we have to break the March 26th high of 4.82 in my opinion, however the path of least resistance is to the downside as I see no reason to be bullish at this time.
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