SINGAPORE: CBOT March wheat may slide to $5.19-3/4 per bushel, as it has cleared a support at $5.24-3/4.
The support is established at the 50 percent retracement of the downtrend from $5.46-1/2 to $5.03-1/4. The next support will be at $5.19-3/4, a break below which could cause a loss to $5.13-1/4.
However, the current drop is expected to be shallower than the one from the Dec. 3 high of $5.29-1/2. It is unlikely to extend below $5.13-1/4.
A break above $5.24-3/4 may signal the continuation of the uptrend towards $5.29-3/4. On the daily chart, wheat failed to break a resistance at $5.32-1/2, the 23.6 percent retracement of the downtrend from $6.27-1/2 to $5.03-1/4. It is testing a support at $5.21-1/2, a break below which may cause a loss to $5.12.
* 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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