SINGAPORE: CBOT May wheat may gain more to $4.70-1/4 per bushel, as it has broken a resistance at $4.63.
The resistance is identified as the 76.4 percent projection level of an uptrend from $4.40-1/4. The next resistance will be at $4.70-1/4, which will be strengthened by a similar one established by a rising trendline.
These two resistances will work together to cause a deep correction similar to the one from the March 12 high of $4.57. Support is at $4.58-3/4, a break below which could cause a loss limited to $4.55-1/4.
On the daily chart, the contract has completed a consolidation around a support at $4.56-1/2, the 14.6 percent retracement of the downtrend from $6.30-1/4 to $4.27. It is expected to rise towards $4.74-3/4.
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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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