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(March 14, 2002) WHEAT: The collapse in wheat prices on Monday were quickly followed by new buying which has supported prices into the middle of this week. Short term trends which turned down last Friday have not been able to turn short term trends back higher. A close above the $2.80 level basis the May Chicago wheat contract should turn trends back higher. Short-term trends have turned up on two occasions since prices topped back in January. Each time these trends have turned up, they have failed within the following week. Technically, long-term indicators are now lining up to confirm a possible move back higher which should last for several weeks. The fundamental situation continues to favor higher prices, but past experiences have trained us that these trend changes have only lasted for about a 20-25 cent move. In the end, prices may not react to the current drought conditions which have been prevalent throughout the major winter wheat growing areas until harvest. Weather conditions can improve and this may be why there has been little to no reaction to recent reports that have continued to downgrade this year's winter wheat crop. If long term trends can manage to turn higher, then the $3.00-$3.10 area will still be the mark to beat if prices are going to ever break-out to the upside for a sustained rally. Fundamentally, large losses could realistically push prices back up towards the $3.50 level and higher. Keep in mind that trends are still down at this time.

SHORT-TERM TREND--Tremd is down.

LONG-TERM TREND--Possibly higher into harvest.

Bryon Fillpot

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