SINGAPORE: CBOT July wheat may break a resistance at $4.38-1/2 per bushel, and rise into a range of $4.41-3/4 to $4.45, as suggested by its wave pattern and a Fibonacci ratio analysis.
The resistance is identified as the 23.6 percent retracement on the downtrend from $4.79-3/4 to $4.26. The bounce from $4.26 seems to have extended.
The bounce consists of three waves. The third wave labelled c is unfolding towards a range of $4.41-3/4 to $4.50-1/4, formed by its 61.8 percent and the 100 percent projection levels.
On the daily chart, wheat refused to test a support at $4.23-1/4, the 114.6 percent projection level of a downward wave C. It may consolidate further around a former support at $4.38-1/4. However, it must be noted that the wave C is capable of travelling into a range of $3.75 to $3.99-1/4, the current consolidation may complete soon.
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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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