SINGAPORE: CBOT December wheat may test a resistance at $5.15-1/2 per bushel, a break above which could lead to a gain to $5.34.
The resistance is provided by the 23.6 percent retracement on the downtrend from $6.13 to $4.85-1/2. The contract is riding on a wave (c), the third wave of a three-wave cycle from $4.85-1/2. This wave is capable of travelling to $5.19-1/2, its 100 percent projection level.
A trend line falling from $6.13 has been broken. The break signals a reversal of the downtrend from this level. A retracement analysis on the medium-term uptrend from $4.68-1/4 to $6.13 on the daily chart reveals that wheat has been holding firm above the 76.4 percent level at $5.02-1/2. It is rising towards $5.23-1/2.
Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.
No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.
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