Global Wheat Market Pressured by Weather, Trade Tensions, and Strong Dollar; Prices Trend Bearish

The wheat market is influenced by weather conditions, international trade, and global political tensions. Planting and harvest weather in Europe, the Black Sea region, Argentina, and Australia is being closely watched. Russia and Ukraine are key wheat exporters, but factors like aggressive shipments, price fluctuations, and ongoing conflict might slow their exports.

The UK expects the highest wheat imports since 2012 due to a smaller local crop, with imports potentially affecting domestic wheat premiums. AHDB projects UK wheat imports at 2.6 million tonnes, up 7% from last year, and foresees limited growth in animal feed demand and stable flour milling needs.

Japan plans to purchase feed wheat and barley through a tender, while Jordan recently bought milling wheat and may issue another tender. USDA forecasts reduced U.S. wheat ending stocks for 2024/25, partly due to lower yields. Russia's wheat exports surged to Egypt but fell in Turkey, with Morocco and Nigeria increasing their imports.

Wheat prices were mixed on the Chicago Board of Trade due to a strong dollar and potential trade barriers under a possible Trump presidency. U.S. and world wheat stock projections are anticipated to remain stable in the upcoming USDA report, and South Korea recently acquired wheat from the U.S. and Australia.

Wheat prices are hovering near the bearish channel's resistance, with a downtrend expected to continue toward targets at $568.50 and $555.60. Negative technical indicators support the likelihood of further declines. However, if the price breaks above $599.00, this could trigger a bullish correction, aiming for a target of $623.70. Today's expected trading range is between $570.00 support and $582.00 resistance.

Data for Technical Analysis (1D) CFD US Wheat Futures - Dec 24 (ZWZ4)

Resistance : 577.02, 580.73, 586.75

Support : 564.98, 561.27, 555.25   

1D Outlook

Source: TradingView

Buy/Long 1 If the support at the price range 554.98 - 564.98 is touched, but the support at 564.98 cannot be broken, the TP may be set around 580.00 and the SL around 550.00, or up to the risk appetite.

Buy/Long 2 If the resistance can be broken at the price range of 577.02 - 587.02, TP may be set around 595.75 and SL around 560.00, or up to the risk appetite.       

Sell/Short 1 If the resistance at the price range 577.02 - 587.02 is touched, but the resistance 577.02 cannot be broken, the TP may be set around 564.25 and the SL around 592.00, or up to the risk appetite.

Sell/Short 2 If the support can be broken at the price range of 554.98 - 564.98, TP may be set around 548.50 and SL around 582.00, or up to the risk appetite.       

Pivot Points Nov 7, 2024 03:40AM GMT