December Wheat Double Top - Could we be headed back around $6.70
CBOT:ZWZ2021 WHEAT FUTURES (DEC 2021)
Wheat markets appear to be in the middle of a confirmed double top . IF resistance in the area of $7.17/bu holds, we should be headed back to the $6.70/bu area.
From a technical perspective, the chart shows a classic double top set up with the lower point being violated, a short pullback higher, followed by a further decline. This should set the target in the $6.70 area.
Fundamentally, wheat markets appear overvalued as well. They have been dragged around by corn recently due to the substitution by feed aspect. Recently corn markets have also come under pressure as the market anticipates a large increase in plantings next year, both domestic and globally.