Wheat Tries To Recover From Bearish Break
Time may have run out on wheat market.
Bryce Knorr
Published: Sep 22, 2008
For much of the past two months the wheat market has seemed to be on the verge of rallies, only to be held back by outside forces. First, corn and soybeans collapsed. Then the world of Wall Street did much the same.
Now, it appears corn and soybeans are stabilizing, and Wall Street fears also are easing, thanks to a trillion dollar bailout. But time may have run out of the wheat market. Charts and seasonal trends look bearish, which should put producers on notice that rallies need to be sold, both for 2008 inventory and 2009 production.
That's a gloomy outlook, but doesn't mean this market can't provide some decent rallies to sell. Funds remain short in Chicago, fueling potential for short covering bounces. And exports remain the strongest of any in the crop sector. While global production is huge, supplies around the world are still tight, prompting importing nations to try to rebuild their stockpiles. Availability of milling quality wheat is also relatively tight, and a Middle East drought has nations there scrambling to cover needs.
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