Chicago September traded a 7 1/2 cent range overnight and posted its 3rd straight new high for the move. Kansas City wheat is trading 4 cents higher while the Minneapolis September contract is up 6 cents. The November Paris Matif contract is up 1.70%, near 236 Euros. European stocks were slightly higher overnight and U.S. commodities have rebounded this morning on a slightly lower U.S Dollar in anticipation of a European Central Bank interest rate cut this week. The Chicago July contract is trading lower against the September options after 170 delivery intentions were issued overnight. After tentatively testing the 7.80 level overnight, September Chicago Wheat looks vulnerable to a correction if corn can break lower. The wheat market continues to find support from ongoing Midwestern U.S. weather problems and concern over the new crop corn yield. U.S. weather maps show a chance for rain in the July 8th-17th time frame and for temperatures to cool to more normal levels. Temporary relief in the recent weather pattern could trigger profit taking in corn, sending wheat lower as a follower. Black Sea weather is unchanged with scattered showers in areas of the Volga Valley over the next week. This should provide temporary relief to spring wheat crops as they begin to head. Warm and dry conditions are expected to return soon there-after which could further deplete soil moisture and restrict yield potential. Market participants continue to revise Russian wheat production lower with most estimates near 50 million tonnes. This would be a reduction of 12.50% vs. 2011/12 but 20% higher than the disastrous 2010/11 crop year. Russian new crop, domestic wheat prices have risen in the last week, signaling supply tightness and disappointment in new crop yield potential. Information regarding wheat production and supplies in the Black Sea is mixed after Ukraine's Prime Minister announced this morning that they have no plans to impose any limits on grain exports in the new 2012/13 crop year. Chicago wheat has rallied nearly 25% since June 15th and successfully priced itself out of any extraordinary export business. The U.S. is expected to benefit from lower world production levels and the long term outlook looks positive for U.S. exports. The Spring Wheat crop progress reports came in as expected with good/excellent spring wheat conditions weaker, down 6% from last week at 71%. The 20-year average for the week ending July 1st is 68%. The short-term outlook for Chicago wheat remains dependent on the direction of the corn market and traders should be cautious. While the long-term, fundamental outlook for wheat has a bullish tilt, short-term price direction is likely overdone.