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NEAR-TERM MARKET FUNDAMENTALS: The wheat market is under pressure this morning after selling off yesterday in sympathy with the other grains. Traders indicate that the other grain markets may be the major price influence in wheat again today. One analyst said that this influence seemed particularly evident yesterday when a sharp drop in the dollar and a rally in crude failed to support wheat as corn and soybeans fell. Fund selling was a major factor in corn and soybeans yesterday, but there was far less fund selling in wheat where the trend-followers remain heavily short. Sources in India continue to express concern over the shortfall in monsoon rains there which is causing worries over higher domestic food prices there. However, this comes at a time when the Indian government has sufficient reserves and world supplies are also ample. Harvest weather remains generally favorable for both hard and soft red winter wheat. Weather over the weekend and into next week should be especially dry and favorable for the soft red harvest. Export sales are due out this morning and traders are expecting a figure below last week’s 584,000 tonnes.


WEATHER: The storm pattern that moved across parts of the northern and south central Midwest yesterday is shifting to the south today. This may bring some needed rain to the western and central Delta by tomorrow with some additional rains there by Sunday. Dry, sunny weather is expected prevail in most of the Midwest through the weekend with showers moving into the western Midwest during the first half of next week. The very hot air system that has dominated the southern Plains is expanding and shifting to the west as predicted.

TODAY’S GUIDANCE: Funds did not come out as big net sellers on yesterday’s break in wheat, and that is an indication that they are still nervous about getting any shorter after the big June break. That said, the grain markets are all under pressure again this morning and wheat could move closer to its recent lows until the other grains turn around or until we see another move lower by the dollar. Export sales will give us better insight as to how competitive US wheat is at these levels. First support in the December contract is near 550. Resistance is near 570 to 575 and again at 600.

This content originated from – The Hightower Report.