WHEAT weekly uptrend opportunity based On 1.00 Lot Calculation:
GLOBAL WHEAT MARKET SHARE:
- LARGEST WHEAT PRODUCERS (OF TOTAL PRODUCTION EXPECTED IN 2022: 774.8 MILLION TONES): China at 17%, European Union at ~17%, India at ~14%, Russia at ~10%, USA at ~6.4% and Ukraine ~3.4%.
- LARGEST WHEAT EXPORTERS OF TOTAL 183.8 MILLION TONS (2020/2021): Russia at 23.9%, Canada at 12.44%, USA at 12.24%, France at 10.30% and Ukraine at 8.9%.
- RUSSIA + UKRAINE SHARE at ~30%: Russia and Ukraine would make around 33% of total global exports.
RUSSIA- UKRAINE WAR AND RUSSIA AGAINST THE WEST ECONOMIC WAR:
- UKRAINE AND RUSSIA LOOKING TO RE-NEGOTIATE A GRAIN EXPORT DEAL THAT EXPIRES ON NOVEMBER 19: Ukraine is seeking to extend the deal for another year, while Russia wants to see a pipeline that transports its ammonia to Ukraine’s Odessa port for shipment reopened as part of the new terms. If the wheat deal doesn’t go through, this could put upward pressure on wheat prices.
- UKRAINIAN GRAIN EXPORTS ARE DOWN 33.4% YEAR-ON-YEAR: Ukrainian wheat exports are down significantly from last year, 12 million tons. With a much lower harvest supplies to the global markets are set to be impacted, which could drive prices higher.
- UKRAINIAN HARVESTS ARE DOWN ~40% IN 2022: According to the Ukrainian government, harvests are down 40% in 2022, with 2023 also expected to yield lower harvests. With winter approaching, demand for wheat is set to remain strong.
- US WHEAT EXPORTS SET TO DECLINE IN 2022-2023 SEASON BY ~10% TO 775 MILLION BUSHELS, THE LOWEST EXPORT LEVELS SINCE 1971-72: According to reports, U.S wheat exports are forecasted to fall substantially, with droughts in the US causing problems for wheat sowing. This could put further pressure on global wheat supplies and push prices higher.
- ARGENTINA WHEAT EXPORTS EXPECTED TO FALL ON DROUGHT CONCERNS: Argentina has lowered its wheat export forecast as concerns for drought intensify. Initially, the forecast export was 15 million tons, however, this was revised down to 13.7 million tons, a decline of ~9%. This will have a negative impact on supply in an already tight wheat market, which could push prices higher.
RECENT PRICE ACTION:
- WHEAT PRICES HAVE HAD A DOWNWARD CORRECTION OF AROUND 45.9% (FROM 1340 ON MARCH 4 TO 724 ON AUGUST 19). In early March, the Wheat prices rose to an all- time high of 1340. Wheat traded last around 850, and if a full recovery happens, it could provide an upside potential of around 57%, however the price could also decline further.
WHEAT, November 2, 2022
Current Price:850
|
Wheat |
Weekly |
|
Trend direction |
|
|
1,150 |
|
|
1,000 |
|
|
900 |
|
|
815 |
|
|
790 |
|
|
775 |
Example of calculation base on weekly trend direction for 1.00 Lot1
|
WHEAT |
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|
Pivot Points |
||||||
|
Profit or loss in $ |
30,000.00 |
15,000.00 |
7,000.00 |
-3,500.00 |
-6,000.00 |
-7,500.00 |
|
Profit or loss in €2 |
30,190.20 |
15,095.10 |
7,044.38 |
-3,522.19 |
-6,038.04 |
-7,547.55 |
|
Profit or loss in £2 |
26,057.50 |
13,028.75 |
6,080.08 |
-3,040.04 |
-5,211.50 |
-6,514.38 |
|
Profit or loss in C$2 |
41,244.00 |
20,622.00 |
9,623.60 |
-4,811.80 |
-8,248.80 |
-10,311.00 |
1. 1.00 lot is equivalent of 100 units
2. Calculations for exchange rate used as of 11:30 (GMT) 02/11/2022
Fortrade recommends the use of Stop-Loss and Take-Profit, please speak to your Client Manager regarding their use.
- You may wish to consider closing your position in profit, even if it is lower than suggested one
- Trailing stop technique can protect the profit – Ask your Client Manager for more detail