SINGAPORE: CBOT March wheat has found a support at $5.12-1/2 per bushel, and may temporarily hover above this level or bounce into a range of $5.16-1/4 to $5.19-3/4.
The support is provided by the 61.8 percent retracement of the uptrend from $5.01-1/4 to $5.31-1/4. Working together with this support is another one established by a rising trendline.
The deep fall on Thursday confirmed a reversal of the uptrend. Chances are, the Jan. 2 low of $5.01-1/4 may be revisited over the next few days. However, it is not very clear how long wheat would stay above the support at $5.12-1/2.
A break below $5.12-1/2 could confirm the extension of the downtrend towards $5.08-1/4.
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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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