March soft red winter wheat futures at the Chicago Board of Trade are presently trading in the middle of a four-week-old sideways trading range on the daily bar chart. That trading range is bound by solid technical support at last week’s low of $5.15 1/4 and the November high of $6.08. The direction in which March Chicago wheat “breaks out” of the aforementioned trading range is likely to be the next significant near-term price trend in the market.
Near-term technical resistance for March wheat is located at Wednesday’s high of $5.64 3/4 and then at this week’s high of $5.78. Near-term technical support is located at $5.40 and then at $5.26 1/4.
click on the chart to enlarge
The weekly continuation chart for nearby Chicago soft red winter wheat futures shows that prices have recently paused amid a solid longer-term price downtrend from the 2008 all-time high. This recent pause on the weekly chart is not bullish. A solid breach of major psychological support at $5.00 in nearby Chicago wheat futures would open the door to a quick run down to psychological support at $4.00 a bushel.–Stay tuned! Jim Wyckoff