March wheat was up 10 cents late in the overnight session. Outside market forces look bullish this morning with a surge up in equity and metal markets and a sharp break in the US dollar. The market is extremely oversold basis traditional technical indicators and also basis recent COT reports. Traders believe tonight's update may show a record net short position from fund traders. The short-term outlook for exports remains questionable, however, as Russian wheat prices have continued to inch lower in the past few weeks, led by increased competition from Ukraine and Kazakhstan. Increased competition from new crops from Argentina and Australia are also seen as negative forces. However, too much rain in Australia has some traders looking for increased quality concerns ahead. There were reports over the weekend that India may allow state-run firms to export wheat and rice. The wheat market saw an impressive recovery bounce early in the session on Friday but failed to find much in the way of follow-through buying to support and closed sharply lower on the session and down to new contract lows. The temporary surge higher in the US stock market and a setback in the US dollar from sharply higher to just slightly higher on the day into the grain opening helped the market recover, but selling emerged late as traders did not want to hold positions over the weekend. December wheat traded as low as 572 1/4 on Friday from a peak of 639 3/4 on November 16th and 659 1/4 on November 8th. Weekly export sales, released before the open on Friday, came in at 614,500 metric tonnes, which was well above trade expectations, and helped to support the bounce as well. Cumulative wheat sales stand at 65.6% of the USDA forecast for the 2011/12 (current) marketing year versus a 5 year average of 67.2%. Sales of 324,000 metric tonnes are needed each week to reach the USDA forecast. The International Grains Council cut their forecast for 2011/12 global wheat production by 1 million tonnes to 683 million tonnes from 653 million last year. A senior agriculture official in Argentina indicated that the country will authorize an additional 2.5-3.5 million tonnes of wheat from the 2010/11 season for export. Argentina's harvest is near 20% complete. Egypt is studying the possible purchase of wheat from Poland and Hungry. Iraq is tendering for 50,000 tonnes of wheat.