Wheat prices poised to rise for the second consecutive week

Chicago wheat futures

The price of Chicago wheat futures is up 1.16% at $11.0 per bushel on mid-Friday trades.

CBOT wheat prices rose 2.69% on Thursday on account of the rising risk of drought in central United States. Estimates from Ukraine that about 5.9 million acres of winter corps would not be harvested due to the war has also further contributed to the rising wheat prices.

World leaders, including those from France, Germany, and Canada are in Ukraine trying to come up with a plan to open up exports of food. The Biden administration is considering building storage silos on the border of Ukraine and Poland to help move grain to the west. This, however, is estimated to take anywhere from 3-8 months to complete this project.

Rumors of Indonesia purchasing some cargoes of SRW wheat further contributed to the rising price of wheat. Also, the US dollar took a large hit on Thursday helping wheat rally.

On the technical side, the RSI of Chicago wheat futures stood at 49.45 and is currently trading above MA (5) but below MA (20) and MA (50). So, BUY position can be taken with the following target and stop-loss:

TRADE SIGNAL: CHICAGO WHEAT FUTURES – BUY: 11.2, TARGET: 11.6, AND STOP-LOSS: 11.0

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