Breakout ComingWHEATUSD is shwoing bullish divergence on the weekly and is clsoe to breaking out of consolidation with
strong bullish candles. Looking to long.
WHEATUSD trade ideas
Trade War and Commodities - Technical Behavior ExplainedFirst let's take a look what happened between China and United States.
FUNDAMENTAL VISION
-At the beginning of 2018, United States started a trade war with China, imposing tariffs on different products.
-In response to this measure, the Chinese government imposed tariffs on US products including some raw materials, the main product exported by the United States to China.
-In relation to this, there was an excessive decrease in exports, reaching the minimum quantity exported in the last 8 years.
-By decreasing the demand for products, this led to a decline in prices. In the case of soybean, we saw a few days ago how the price reached the minimum since 2008.
TECHNICAL VISION
WHEAT WEEKLY CHART
SOYBEAN WEEKLY CHART
-We observe that price behavior was pretty similar in both assets.
-In case of Soybean, the first down move was stronger than the Wheat, but then both of them started a similar consolidation/accumulation process to continue the down move.
-In the case of Wheat, price did a -18% movement since the previous Max., and then formed a flag pattern that lasted around 5 months. The breakout was perfect, and the bearish trend continued with a -16% movement. In total the downside movement of Wheat was around -28%.
-The first down move of Soybean, was around -24%. The pattern of consolidation was an ascending wedge for about 6 months, in which the movement after the breakout was slow at the beginning, but then it dropped on a -12% move.
Buy Wheat, potential to rebound! Wheat price rebounded from low of 420 recently, and failed to berak the previous low in Feb. Seems to have potential to from up a W shape buttom. Technically, daily MACD and stochastics have bull divergnece signal and weekly MACD histogram is now sloping up. thus would bet on a rebound to come. This is a trade that assume to have potential before Jun. according to past experience. May be able to buy more if price drop.
Divergence EverywhereWe can see divergence on Rsi and MACD, and a reversal. Possible buy opportunity?
WHEATUSD Short Term Resistance draw closerWHEATUSD is just about to relax from high levels which were reached in the cold season. The retracement of the down move of the past few days has been just below the support turned resistance at around 5.69-5.70. When price retraces to this level and the resistance proves to be valid this is an entry point to follow the higher timeframe downtrend at least until 5.40.
The insights are taken from my own data driven approach paired with some chart analysis
a treat is wheat, when one must eat. 4h potential head and shoulders
grain shorts are HIGH so short covering is NIGH.
wheat mon appetite.
watching for a higher moveClose above 4.55 could take this to around 5. Fibs lining up and indicators showing potential move higher from the current 4.50 area.
WHEATUSDNice Reaction from Key Reversal Area, wait for lower degree correction before considering going short
Long Wheat.Thanks to @ZFXtrading on twitter for this idea.
Could be supply issues with this commodity. Look at Golden Ratio fibs.
Wheat is set for a higher highAfter making a second high in the forming upward channel, the correction to 200 EMA took place. The reversed U shape of the volume structure signaled the correction stop around 200 EMA as supported by the whole array of daily tails. Wheat is set to move upwards to the new price territory in the area of 6.00.
Possibile Short Su WheatNelle prossime 4 ore, in particolare se la quotazione arrivasse a 5,01, il trend potrebbe invertirsi, da Long a Short.
