ZW1! Wheat Futures Capital Rotation To Commodities?
One thing that never seems to change is as one sector advances another lags and while one lags the another advances. The allure of a rising market and fear of reversal in another causes capital rotation.
Looking at risk on assets they have made quite the advance into old highs and some all time highs while many commodities are reaching old lows and past long term support levels.
When looking at these charts technically we can see wheat futures have retraced 75% of its last advance and currently sitting on the last real support resistance flip. Many other commodities such as corn, and soy are sitting in the same position.
If we consider these assets being in a good buy zone technically and look at other assets like stocks and indices, that are in all time high territory the question is where will the profit taking go. The longer an advance lasts the closer it is to the end and while the advance may not be over participants are certainly considering taking profit and rotating capital. When a decline begins fear will cause the rotation from one to the next.
Current Trading Plan:
This a weekly chart of wheat futures and we can see the average range is approximately 55%. Currently accumulating in the bottom portion of the 55% range from the current support level and looking to distribute in the upper 1/8th.
If we consider the average rate of increase from past advances depending on how long accumulation lasts looking at a period of late 4th quarter 2024- 1st quarter 2025
Trade Well......
Looking at risk on assets they have made quite the advance into old highs and some all time highs while many commodities are reaching old lows and past long term support levels.
When looking at these charts technically we can see wheat futures have retraced 75% of its last advance and currently sitting on the last real support resistance flip. Many other commodities such as corn, and soy are sitting in the same position.
If we consider these assets being in a good buy zone technically and look at other assets like stocks and indices, that are in all time high territory the question is where will the profit taking go. The longer an advance lasts the closer it is to the end and while the advance may not be over participants are certainly considering taking profit and rotating capital. When a decline begins fear will cause the rotation from one to the next.
Current Trading Plan:
This a weekly chart of wheat futures and we can see the average range is approximately 55%. Currently accumulating in the bottom portion of the 55% range from the current support level and looking to distribute in the upper 1/8th.
If we consider the average rate of increase from past advances depending on how long accumulation lasts looking at a period of late 4th quarter 2024- 1st quarter 2025
Trade Well......