The zone is formed by the 61.8 percent projection level of an upward wave (c) from $4.90 and the 23.6 percent retracement on the downtrend from $6.13 to $4.85-1/2.
A break below $5.08 may cause a loss limited to $5.04 while a break above $5.15-1/2 may lead to a gain into the range of $5.19-1/2 to $5.34.
The bias could be towards the upside, as wheat has broken a falling trendline. The break signals a reversal of the downtrend from $6.13. A reversal of the trend would simply mean that wheat could at least bounce to $5.34.
* 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.