The Barchart National HRW Wheat Price Index (HWPI, weighted national average cash price) rstill looks to be in Wave B (second wave) of its 3-wave major (long-term) downtrend. October saw the HWPI post a high of $9.96, still short of its upside target near $10.4150. Monthly stochastics continue to hold above the oversold level of 20% meaning there is still time and space for the index to move lower. The market remains fundamentally bullish, as indicated by Kansas City futures inverted futures spreads. A key price during November is October’s high.
The Barchart National SRW Wheat Price Index (SWPI) is also in a major (long-term) downtrend with the October high near $8.95 looking like it could be the peak of Wave B (second wave) of the 3-wave pattern. A key difference between the SWPI and HWPI is Chicago futures spreads were neutral as October came to an end, after moving into bearish territory during the month. This leaves the door open for a possible test of the August low near $6.6750 over the winter months.
The Barchart National HRS Wheat Price Index (HSPI) is also in a major 3-wave downtrend with an upside target area for Wave B (second wave) between $9.9850 and $10.65. With monthly stochastics near the oversold level of 20% the HSPI could eventually test and/or take out the August low near $7.8350. Fundamentally the market remains bullish, as indicated by the weak carry in Minneapolis futures spreads, a factor that should limit selling interest in cash HRS wheat.
