SINGAPORE: CBOT March wheat may fall further to $5.02-3/4 per bushel, as it has broken a support at $5.08.
The support is provided by the 61.8 percent projection level of a downward wave (C) from $5.31-1/4. It is the third wave of a three-wave cycle from $5.38-1/2.
At its full capacity, this wave may travel to $4.94. A realistic target could be $5.02-3/4. The pattern from $5.38-1/2 looks like a flag on the daily chart. It suggests a much lower target around $4.76.
The deep fall on Thursday is a convincing signal that downtrend from the Aug. 2, 2018, high of $6.27-1/2 resumed towards $4.80, which is pointed by a falling trendline.
A break above $5.08 (first chart) may lead to a gain into the range of $5.10-3/4 to $5.12-1/2.
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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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