Short PUT on ZW
Volatility has risen in the last days
Commercial Traders are going extremely long since a few weeks
no distribution in the last weeks
Zw1
Wheat - Mar $4 Support?Bulled up... just a matter of weather* $4 support holds or we drop down to 3.5 levels
Trend line resistance erroded
Cocao Feb17Long term looks very bearish
- Supportive trend line (green) from started in 2002... broke down last year
- H&S pattern set up
- H&S neckline touched up but 1870 not taken out yet
Looking at potential pull back to broken trend line (green), up into 3000
Wheat: Long Term Wave Count (Attempt) & Potential Bullish BatI am still getting my feet wet with waves so take this count with a grain of salt..however I thought it was educational for myself and potentially others. Even though it seems very "convenient" that we are coming close to the end of Wave C, it does align with the view of the bullish Bat pattern. If you see something I can fix please share it with me so I can learn and improve! :)
That said, I will be buying wheat at the bat entry shown if the price ever makes its way there. Cheers!
The Bottom Many Have Been Looking For: WheatIf I were asked to pick just one asset to be long in 2017, I'd consider wheat as my top choice.
I am still long from 422. As shown below, I got stopped out but managed to re-enter at that exact price.
Wheat Has Completed A Bearish Butterfly and AB=CD PatternI had an order set to short 1 pip above the current high of the day and didn't get picked up. I have since moved the order to the high as shown in the chart. Risk:Reward is pretty nice and looking left (further left than on this chart) there is some structure which supports this as a supply zone.
Wheat has been looking pretty bullish so it would probably be advisable to wait for a bearish signal on a lower time frame. Let me know what you think about Wheat!
WHEAT | Weekly Chart A rather logical looking interpretation. There's a reasonable degree of support, whilst we're buying in the lowest percentiles of the last decade. Further, the probability of the downtrend being breached looks increasingly likely. Further, the return distribution of commodities is particularly convex or asymmetric with a long right tail. Thus, we can give the position similar treatment to that which we might a long option trade.
Wheat Oct'16 - decision timeConsolidating on long term support line 386 or 412. Will see what unfolds. Would look to buy into 393 level and below.
Christmas wheatieswheat has been pushed down hard on large crop volume and seems like good time to take a shot, will use a calendar spread to reduce cash required
Long WHEAT - return to the most accepted priceIn short-term I think wheat is ready to return to balance price.
Positive factors:
+ soaring global ethanol demand;
+ prospects of lower crop inputs in the face of falling profitability;
+ strong recovery in global feed demand (USDA hiked by nearly 11m tonnes to 144.4m tonnes its forecast for world feed use of wheat in 2016-17. That's the second highest figure in record);
+ increased investor interest on return to multi-year lows;
+ price dynamics (I believe wheat is still in balance and expect it to return to the most accepted price of 475);
Negative factors:
- inventory forecast at a record high (253.7 tonnes);
- strong dollar;
- strong El Niño episode may point to a 2016 winter wheat yield above trend, possibly well-above, and a two-thirds chance of the average spring wheat yield to be modestly above trend;
Wheat July'16Looking to catch a potential rally into 480 level before shorting off long term bearish trend line (around 480) to short into sub 425.
Wheat LongI still haven't come across any compelling justification to get long besides my technical read. Most fundamentals, crop yields, weather all appear to suggest we go further south but we are now in my buy zone
ZW1! - Wheat will trigger bullish sentiment?Fundamentally not much bullish... maybe a mini USD meltdown/correction might provide enough to send all commodities flying?
Strong support around 420-430
Buy Wheat!You can hardly get a simpler and less ambiguous recommendation than that.
After a 7 year bear market I think the time may have come for wheat to rise again. You can see a small monthly RSI divergence which has formed over the past 6 months and a larger hidden divergence which has formed over the past 5 years. Commercial buying is at historic levels and the seasonals are favorable for the second part of the year. In the media there’s plenty of news about oil and energy markets but wheat and agriculture in general at the moment are all but completely neglected. By reading various blogs I find also that most of the traders are bearish on agricultural commodities. The confluence of all of these factors suggests a strong buy for wheat.
Does that mean mortgage your house and put all of your money in wheat? No, never bet the farm on any investment or trade no matter how convinced you are.
I recommend using the following strategy (which you may modify to reflect your own strategy, risk tolerance and account capitalization):
I suggest dividing the money allocated to wheat in 3 parts:
1. Investment
Allocate approx. 1.5% of your trading account to wheat. For example if you have a 100,000$ account you would allocate 1,500$ to this position. The stop is 0, essentially this is an investment and there is no stop. The target is all time highs. I don’t have a more precise target, you would just have to wait for the pattern to unfold and when the mass psychology is “right” sell. For example if you see in your local newspapers front page articles about how high the price of wheat is and how high it’s gonna go, you should sell, but that is years away, it may be even decades away. It took wheat more than 20 years to break the 1974 high. To not have to wait that long we have the other 2 types of trades.
2. Long term trade
Place a trade and assign a stop below 400 on a monthly closing basis. For the long term rising trend in wheat started in the year 2000 to remain intact, wheat shouldn’t close below the ascending trend line or approx. below 400. I suggest risking about 0.5%-1.0% of your total trading capital on this stop. If wheat goes to around a 1000 sell 1/3 of your position. Sell the second 1/3 around the 1,100-1,300 level. The last 1/3 sell at your discretion if wheat breaks above all time highs.
3. Speculative position
Place a trade and assign a stop below 460 on a daily closing basis. Sell 1/3 at the 640-680 level, 1/3 at the 800-850 level (retest of the upper trend line channel) and 1/3 at 1000-1100 level. Risk no more then 0.5% of your trading capital on this trade.
Whoever chooses to go with the trade good luck.
This is not investment advice and you are solely responsible for your actions. For a full disclaimer see here: www.highprotrading.com
For a full list of instruments traded in the lifetime of the portfolio and for performance go to the Performance section: www.highprotrading.com
Time to pick some CornCorn has broken and closed below it's wedge on a weeky time frame. We are looking for pullback triggers to get involved to the short side. Targets are identified and the stop will come from the trigger (on a 60 or 240 min chart)...NO TRIGGER, NO TRADE!
The squeeze is comingAbove 998 and the squeeze will have shorts scrambling. A close above this area and we will be looking for triggers long.
No Chicken dinner today!ZC is starting to feel choppy in this area so we are taking off our long position at a small loss. Like we mentioned, this could chop until harvest starts. We will keep her on the watch list. NEXT!
