Spring wheat futures on the Minneapolis Grain Exchange were lower on Thursday in a technical setback from Wednesday's climb to near contract highs, traders said.
The nine-day relative strength index for the MGE March contract stood at 79 ahead of the open, above the benchmark level of 70 that technical traders view as one sign of an overbought market.
Technical declines in Chicago and Kansas City wheat futures added to the weaker tone, but light fund buying underpinned prices in Minneapolis, traders said.
"We had spillover fund buying from yesterday," one MGE trader said.
As of 11:30 am CST (1730 GMT), MGE March wheat was down 2 cents at $3.90-1/2 per bushel, with deferred months down 3/4 to 1-1/2 cents.
ADM Investor Services and UBS Warburg each bought 300 to 400 March contracts, while locals were featured sellers, traders said.
Hedge pressure weighed on futures in the early minutes of trade, reflecting a pickup in country offerings as farmers took advantage of Wednesday's rally to two-month tops, close to contract highs.
Lackluster export business ahead of the New Year's Day holiday added to the bearish tone.
Wheat traders said the recent climb in wheat futures prices has probably kept some potential buyers away from United States wheat.
Dry conditions in the southern US Plains remained a bullish background factor.
The Meteorlogix weather service said there was no significant chance for rain in the region over the next seven days.
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