Technical Analysis and WHEAT/RUB

Dmitry Lukashov IFC Markets

Russia and the EU may reduce wheat exports

In this review, we suggest considering the personal composite instrument (PCI) “Wheat vs the Russian Ruble”. It increases when wheat prices rise in the world market and the Russian currency weakens. Is there a possibility for the WHEAT/RUB to rise?

A few messages at once can indicate a possible reduction in the supply of wheat in the world market. According to the European Commission, exports of soft wheat from the EU countries in the 2018/19 agricultural season for the period from July 1 to November 11 amounted to 5.9 million tons, which is 24% less than the level of the previous season for the same period (7.8 million tons). According to the forecast of the Russian agency SovEcon, wheat exports from Russia in November of the current year will be reduced to 4 million tons, which is the minimum volume since July. According to the forecast of the Russian Institute for Agricultural Market Studies (IKAR), wheat exports from Russia in the current agricultural season will be reduced to 33 million tons, compared to 41.3 million in the previous season. This is caused by a decrease in yield. In turn, the weakening of the Russian ruble is observed against the background of declining oil prices. The share of hydrocarbons in Russian exports is approaching 75%. In addition, the Ministry of Finance of the Russian Federation announced that it is considering plans for the devaluation of the ruble to replenish the state budget.

On the daily timeframe, WHEAT/RUB: D1 overcame the resistance line of the short-term downtrend and returned to the long-term uptrend. The further price increase is possible in case of a reduction in the world wheat yield and the devaluation of the ruble.

The Parabolic indicator gives a bullish signal.
The Bollinger bands have narrowed, which indicates low volatility. Both bands are titled upwards.
The RSI indicator is above 50. It has formed a small positive divergence.
The MACD indicator gives a bullish signal.

The bullish momentum may develop in case WHEAT/RUB exceeds the upper Bollinger band and the two last fractal highs at 35300.This level may serve as an entry point. The initial stop loss may be placed below the two last fractal lows, the 4-month low, the lower Bollinger band and the Parabolic signal at 32900. After opening the pending order, we shall move the stop to the next fractal low following the Bollinger and Parabolic signals. Thus, we are changing the potential profit/loss to the breakeven point. More risk-averse traders may switch to the 4-hour chart after the trade and place there a stop loss moving it in the direction of the trade. If the price meets the stop level (24700) without reaching the order (26500), we recommend to close the position: the market sustains internal changes that were not taken into account.

Summary of technical analysis

Position	Buy
Buy stop	Above 35300
Stop loss	Below 32900

Want to get more free analytics? Open Demo Account now to get daily news and analytical materials.

Author

Dmitry Lukashov

IFC Markets

Dimtry Lukashov is the senior analyst of IFC Markets. He started his professional career in the financial market as a trader interested in stocks and obligations.

AUD/USD bounces off weekly low on Israel-Lebanon ceasefire

AUD/USD recovers slightly from the weekly low during the Asian session on Thursday as a new Israel-Lebanon ceasefire keeps a lid on the safe-haven US Dollar. Meanwhile, the US and Iran remain at odds over key issues, which, along with hawkish Fed expectations, act as a tailwind for the buck. Furthermore, diminishing odds of an RBA rate hike in June cap the currency pair as traders keenly await the US NFP report on Friday.

USD/JPY remains close to 160.00 intervention threshold on Mideast tensions

USD/JPY struggles to find acceptance above 160.00 and retreats from a one-month high during the Asian session on Thursday amid fears that authorities will step in again to prop up the Japanese Yen. Furthermore, a new Israel-Lebanon ceasefire caps the US Dollar and supports the currency pair. However, renewed US-Iran tensions favor the USD bulls amid Fed rate hike bets and also hold back the JPY bulls from placing aggressive bets amid economic risks stemming from the Middle East conflict, suggesting that dips are likely to be bought into.

Gold bounces off one-week low; upside seems capped on Iran uncertainty

Gold recovers from a one-week low touched during the Asian session on Thursday, as news of an Israel-Lebanon ceasefire acts as a headwind for the safe-haven US Dollar. However, renewed hostilities in the Gulf, along with stalled US-Iran peace talks, keep geopolitical risks in play and should support the USD. Moreover, US-Iran tensions remain supportive of higher Crude Oil prices, fueling inflationary concerns and bolstering bets for higher interest rates for longer. This should cap the non-yielding bullion and warrants caution for bulls.

Bitcoin drops below $65K amid reinforced bear market signals

Bitcoin dipped further below $65,000 on Wednesday, with onchain data from Glassnode signaling a market firmly in a bear phase. The decline has pushed prices back into a key valuation range between the Realized Price and the True Market Mean. Glassnode noted that a key shift in market structure has also emerged.

The upside-down math of debt

In 2010, Professors Carmen Reinhart and Kenneth Rogoff published a paper, Growth in a Time of Debt, which instantly went viral. The main thesis of the paper was that once a government's debt-to-GDP ratio crosses above 90%, a financial crisis and default are around the corner.

Recession on paper: What really moves the Canadian Loonie now?

Statistics Canada handed the headline writers a gift and the analysts a headache. Real GDP shrank 0.1% on an annualized basis in the first quarter, and with the fourth quarter of 2025 revised down to a 1.0% contraction, that is two negative quarters in a row, the textbook definition of a technical recession and Canada's first since the pandemic.