The wheat continuous contract (@W) initially continued higher after the last update as expected. However, the commodity found strong resistance from its 200-day moving average in late October and has now given back its recent gains.
While wheat has steadily been declining for the last couple of weeks, it is now approaching an area which may provide support. The area corresponds to last summer's lows around 635. The area will likely be tested in the near future and will likely be pivotal for the direction of wheat for the rest of the year.
As a reminder, wheat has been in a downtrend for over a year, but recent price action had suggested that a trend reversal could be under way. For now, until further developments, it appears that wheat may still be in a bottoming process.
You can read more of this blog here.Written by Frederic Palmliden, CMT, Senior Quantitative Analyst, TradeStation. Follow TradeStation