SINGAPORE: CBOT wheat may test a resistance at $6.88-1/4 per bushel, a break above which could lead to a gain to $7.03-1/2.

The contract broke above a falling trendline. The break confirms a reversal of the downtrend. It has completed a pullback towards the line.

A retracement analysis on the trend reveals a target zone of $7.03-1/2 to $7.18-1/2. Support is at $6.69-1/2, a break below which may cause a fall to $6.58.

On the daily chart, the contract is poised to break a resistance at $6.80-3/4 and rise towards $7.01-3/4, as the shallow correction triggered by the resistance has been totally reversed.

A retracement analysis on the uptrend from $4.96-1/4 to $7.69-1/2 suggests a target of $7.05, as wheat has broken the resistance at $6.65.

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