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WHEAT: Technical Analysis – Drought bullish for wheat prices

By IFCMarkets

Drought bullish for wheat prices

Drought conditions are expected to continue across US south western Plains. Will the wheat price resume advancing?

Radiant Solutions forecast indicated dry weather across the south western Plains over the weekend, with little likelihood of showers next week. Continued drought conditions are bullish for wheat, data showing the US exported 487,902 tons of wheat last week, up from 324,794 tons in the same week of 2017 also supporting wheat prices.


On the daily timeframe WHEAT: D1 is edging lower after hitting five-month high Tuesday. The price is above both the 50-day moving average MA(50) is set to cross the 200-day moving average MA(200) from below, which will constitute the bullish chart pattern Golden Cross..

We expect the bullish momentum will continue after the price closes above the upper Donchian bound at 476.6. A price point above that level can be used as an entry point for a pending order to buy. The stop loss can be placed below the last fractal low at 447.5. After placing the pending order the stop loss is to be moved to next fractal low following Parabolic signals. Thus, we are changing the profit/loss ratio to the breakeven point. If the price meets the stop loss level (447.5) without reaching the order (476.6), we recommend cancelling the order: the market sustains internal changes which were not taken into account.

Technical Analysis Summary

Position Buy
Buy stop Above 476.6
Stop loss Below 447.5

Market Analysis provided by IFCMarkets

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About Louie Lewis

Louie Lewis
Successful forex trading starts with you first. Then comes the actual strategies and techniques. I have been involved with forex and forex trading for a few years now. It is a wonderful way to build wealth. The learning never stops and I want to help others along their journey into this wonderful market of opportunity.

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