Probably the increase in wheat and corn will continue

After yesterday showed that yields of wheat in the US fell by 12% many investors have changed their views on the further development of the price of the raw material. From the charts below we will see that the forecasts for the price significantly lag behind Forward price.
Wheat shows that the gap is quite large and that serious increase in price is expected to start from the beginning of the second quarter this year. From the graph it is clear that the price according to forward contracts should be about $ 455 a bushel while analysts have forecast the price remains below $440 by the end of Q2. By the end of the year most likely the difference between the forecast and the actual price will be around $25.

Bloomberg

For corn, things are a little better and did not expect particularly great difference between the forecasts and the price of the commodity. Forward transactions show that the price will most likely start to move up from the second quarter and ended the year at a price around $385, according to forward transactions, according to analysts at a price of $375.

Bloomberg

Technically the price of wheat is at record low levels and is suitable for a purchase, price compared formed by forward transactions. The price is in the area of horizontal support, 50SMA and 200SMA make bullish crossover and CCI(14) gives us a signal for growth as crosses -100 bottom up. Given expectations of a rise in price since the beginning of the second quarter current levels are suitable for long positions with stop shallow priced around $409.00.

For corn technically cost also is a good level to buy. The price is horizontal support coincides with 200SMA. 50SMA and 200SMA are bullish cross and CCI(14) crossed -100 from bottom, also a positive signal. Given forecasts and price formed by forward transactions levels are good for purchase after forming good Price Action signal.

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