Wheat May Separate From The Chaff

• May 30, 2001
• Marc Dupee

July wheat
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lows. Wheat in Oklahoma and Kansas was damaged by hail yesterday and is
following through, up 3 1/2 at 268 1/4.

Despite wheat trading at a contract low, crop
forecasts for the winter crop (harvest begins in June through July) are the
smallest since 1978. Winter wheat represents about 70% of US production. The #1
(Kansas) and #2 (Oklahoma) producers are forecasting harvests down 18% and 32%,
respectively, signifying that wheat has the fundamental underpinning to stage a
rally.

Also trading at a contract low, corn
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trading at its Turtle Soup Plus One
Buy
trigger. 

In the financials,
Nasdaq 100 futures
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on a warning that Sun Micro would miss earnings. We still have two down signals
from the
Market
Bias Indicators Page, implying downside in equity index futures. 

June dollar index futures
(
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Pullback From Highs and are a Momentum-5
market. On the other side of the coin,
euro FX futures
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Swiss francs
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are trading in narrow bars near their low with overhead gaps also pressuring.
Look for these markets’ respective up and down momentum to follow through. 

Japanese yen
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and
Pullback From Highs
market, are trading in a narrow range, providing a reduced-risk entry
opportunity. 

Also in the softs and down after having made a
New 10-Day Low, July sugar
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Cocoa
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momentum by registering a new
New 10-Day Low. This market is testing what was very firm support before
this market began its recent rally in the 960 to 950 zone. 

Finally, although they are trading above their Turtle Soup Plus One
Sell trigger, August feeder cattle

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been trading straight down from the opening tick with the TS+1 signal acting as
a good leading indicator of a possible pullback after recent torrid gains in
this market.