WCE close: Canola soars to new highs on technicals

(RNI) — Winnipeg Commodity Exchange grain and oilseed
futures closed Wednesday’s session higher with canola surging to fresh contract highs for
the fourth day in a row on bullish technical signals, brokers said.

Canola noted a heavy trade with much of the volume comprised of intermonth
spreading as commercials and commodity funds rolled positions forward, traders said.

The total canola volume was estimated at 23,500 contracts, down from Tuesday’s
26,871 contracts, including an estimated 18,768 contracts that were involved in the spread

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Canola prices rallied, setting fresh contract highs on bullish technical signals. The
firm tone in Chicago Board of Trade (CBOT) soy complex futures and a slower pace to farmer
selling contributed to the strong surge.

Traders noted that the January contract penetrated the significant resistance at the 1996
high of $494.50, which suggested the market has moved into a “new paradigm.” They
added “the trend is up and there is nothing on the charts to stop it.”

Farmer selling has slowed ahead of Christmas, cash dealers said, with their
offerings limited to scale-up “resting” orders.

Slowing the rally was the firm tone in the Canadian dollar, although traders felt the

Crushers were strong buyers with only routine exporter interest noted. Commodity
funds were also good buyers with commission house buying evident. Traders felt funds
have bought about 1,000 March contracts. The selling was principally commercial with much
of the activity profit-taking and positioning ahead of year-end.

Western barley ended a bit firmer in light activity. Intermonth spreading augmented
the small trade with commercials the principal traders. The firm tone in CBOT corn and
slow farmer selling was balanced off by the unaggresive end-user demand which
accounted for a choppy tone, brokers said.

The total western barley volume was estimated at 390 contracts, up from
Wednesday’s 229 contracts.

Feed wheat was unchanged and untraded amid a lack of interest.

WCE closing prices in Canadian dollars per tonne, Dec. 12, 2007

WCE spread trade prices, in Canadian dollars. “Volume” represents the number of
spreads.

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