Moreover, the heavy rains have impeded barges going along the Illinois river, the official delivery point for corn and soybean futures. The CME Group has already enacted measures to allow traders to delay deliveries until the river abates.
Chris Kimble of Kimble Charting Solutions also pointed to a potentially bullish breakout of a wedge formation in WEAT’s chart. The wedge formation depicts a price pattern where the trend lines drawn above and below a price chart converge into an arrow shape. Once the security breaks out of the wedge, technical analysts believe it foreshadows a return to a major trend, or at least a short- to intermediate-term trend reversal.
Moreover, Kimble looked at the long-term charts of the iPath Dow Jones-UBS Grains Subindex Total Return ETN (NYSEArca: JJG) and saw a long-term support in play. JJG is bouncing off a long-term support, or price level that that has been historically difficult to break under, going back eight years.
iPath Dow Jones-UBS Grains Subindex Total Return ETN
For more information on the commodities market, visit our commodity ETFs category.
Max Chen contributed to this article.