- New Science in old markets -

Wheat extends – buy some

December wheat futures made a bottom extension yesterday. The contract expires this month so this sign of 'exhaustion' selling may have only brief local relevance but we should take note anyway. The forward months are trading at higher prices the further forward they are - a 'normal' or 'contango' market in other words - which means the dangers of buying here are slightly increased by the tendency of those forward months to decline toward cash or 'spot' prices.

Nonetheless, as a daily-scale signal only lasts for three weeks on average, try buying some wheat for delivery next year hereabouts. The AlphaMail to accompany this commentary will be issued later on today with the usual stop-loss and profit-taking threshold advice. The current price for March 2016 delivery is 467 and for July it is 482. Scale-down buying over a narrow range might be the most sensible approach.

Wheat bottom ext