Wheat futures (September delivery) have been experiencing another round of weakness after forming a double top pattern in July. In today’s session, the price has failed to capitalize on news that Russia attacked Ukraine’s main inland port across the Danube River, raising significant concerns over the supply outlook.
The momentum indicators are also endorsing the bearish technical picture. Specifically, the MACD is softening below its red trigger line and approaching zero, while the RSI has flatlined below its 50-neutral mark.
To the downside, the price could initially test the recent support of 6.4250. A break below the ascending trendline that connects a series of higher lows might turn the spotlight to the July bottom of 6.2130. Piercing through that wall, the commodity could challenge the May low of 6.0300.
Alternatively, if the price retraces back higher, immediate resistance could be met at the inside swing high of 6.8800. Conquering this barricade, the bulls might attack the March peak of 7.2300, which overlaps with the 200-day simple moving average (SMA). Even higher, the price may advance towards the double top region of 7.7600.
In brief, despite emerging risks over the supply outlook, wheat futures quickly surrendered today’s initial gains. Hence, we could see further losses for wheat as the combination of a long-term downtrend and the recent formation of a double top pattern could severely weigh on the price.
Wheat futures (September delivery) have been experiencing another round of weakness after forming a double top pattern in July. In today’s session, the price has failed to capitalize on news that Russia attacked Ukraine’s main inland port across the Danube River, raising significant concerns over the supply outlook.
The momentum indicators are also endorsing the bearish technical picture. Specifically, the MACD is softening below its red trigger line and approaching zero, while the RSI has flatlined below its 50-neutral mark.
To the downside, the price could initially test the recent support of 6.4250. A break below the ascending trendline that connects a series of higher lows might turn the spotlight to the July bottom of 6.2130. Piercing through that wall, the commodity could challenge the May low of 6.0300.
Alternatively, if the price retraces back higher, immediate resistance could be met at the inside swing high of 6.8800. Conquering this barricade, the bulls might attack the March peak of 7.2300, which overlaps with the 200-day simple moving average (SMA). Even higher, the price may advance towards the double top region of 7.7600.
In brief, despite emerging risks over the supply outlook, wheat futures quickly surrendered today’s initial gains. Hence, we could see further losses for wheat as the combination of a long-term downtrend and the recent formation of a double top pattern could severely weigh on the price.
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