CBOT July wheat may test resistance at $4.52

SINGAPORE: CBOT July wheat may test a resistance at $4.52 per bushel, a break above which could lead to a gain to $4.62-1/4.

The resistance is provided by the 86.4 percent projection level of a downward wave C from $5.40-1/4. This wave has completed at the March 11 low of $4.35-1/2.

A flat pattern has been unfolding from this low. It consists of three waves that are roughly equal in length. Such a characteristic would mean that the current wave c could travel to $4.77.

A break below $4.38-1/4 could signal the continuation of the downtrend towards $4.23. On the hourly chart, a projection analysis reveals a target at $4.52-1/2, the 38.2 percent level, which is almost identical with $4.52 on the daily chart. This target will be confirmed when wheat breaks $4.45-1/2.