Grain markets were relatively quiet to round out the month of October, will November bring more volatility?
Wheat
Thursday’s Recap
Thursday’s Wheat market was lower with the Dec contract off 2’6 to 570’4. Overall the session saw 106,433 contracts traded, with Dec volume coming in at 61,593. Total open interest closed the session at a one month high of 426,025, up 7,004, or 1.67%. Dec open interest added 1,561 (0.79%), to 200,077.
Technicals
December Chicago wheat futures were able to defend the low 560’s yet again yesterday which bodes well for risk/reward traders looking for the trend to turn. With that said, our pivot pocket from 582 3/4-585 1/2 remains intact too, which has been a brick wall recently. The Bulls will want to see consecutive closes above this pocket to put an end to the month-long trend of lower highs.
Technical Levels of Importance
Resistance: 596-600, 615-617 1/2***, 629 1/2-634***
Pivot: 582 3/4-585 1/2
Support: 557 1/2-560 1/2***, 544 1/4***
Fundamental Notes
Weekly Export Sales Estimates
Net sales of 411,400 MT (15,116,358 bushels) for 2024/2025 were down 23 percent from the previous week and 14 percent from the prior 4-week average. This was within the range of expectations. Increases primarily for Mexico (169,900 MT, including decreases of 15,400 MT), the Philippines (79,500 MT), Indonesia (60,400 MT)
Popular Options
The Dec 565 put saw the most action with 1,627 contracts traded. Calls with the greatest open interest are the Dec 600 strike (7,951), and for the puts are the Dec 550 strike (7,685).
Volatility Update
Implied Volatility ended the day slightly up with WVL gaining 0.22, to close the session at a one week high of 30.03. Historical volatility (30-day) settled at 24.45%, losing 0.0131%. The WVL Skew was moderately higher with the 30-day gaining 0.14, closing the session at 5.86.
Seasonal Tendencies Update
Below is a look at historical price averages for March wheat futures on a 5, 10, 15, 20, and 30 year time frames (Past performance is not necessarily indicative of future results).
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