The latest spike on this chart happened only because the data provider switched from September ZWU6 to next front contract December ZWZ6. As Dec is trading higher because of curve contango (ZWU6 price is 408 right now), the change in underlying contract temporarely distorts indicators on the chart, however also calls our attention to possible new setups and patterns.
Weekly:
- Ichimoku is bearish
- Heikin-Ashi is swing bullish, but even with higher ZWZ6 price it looks like haDelta is turning down. This shows the market is still under selling pressure
- MACD and EWO ticks up, but both are still bearish.
Daily:
- Ichimoku is neutral due to contract switch, but if you'd replace price with still tradable ZWU6, that shows we are at the lows again.
- Heikin-Ashi has bearish indication.
- What should we focus at? I think if ZWU6 holds above 400 before contract maturity next week, that would make a possible double bottom on the "old' setup. If we translate this to the new setup with ZWZ6, that would make a possible Kijun retest ard 422-425. So in case December Wheat gives a buy signal around 425 support, we'll have an inverse Head and Shoulders pattern, with possibly 460-480 target later.
Strategy: wait until ZWZ6 price gets lower to Kijun Sen. Look for a buy signal there. Enter 1 unit long in case of valid signal. Increase to 2-3 units if price confirms and market breaks above 440 later.
Weekly:
- Ichimoku is bearish
- Heikin-Ashi is swing bullish, but even with higher ZWZ6 price it looks like haDelta is turning down. This shows the market is still under selling pressure
- MACD and EWO ticks up, but both are still bearish.
Daily:
- Ichimoku is neutral due to contract switch, but if you'd replace price with still tradable ZWU6, that shows we are at the lows again.
- Heikin-Ashi has bearish indication.
- What should we focus at? I think if ZWU6 holds above 400 before contract maturity next week, that would make a possible double bottom on the "old' setup. If we translate this to the new setup with ZWZ6, that would make a possible Kijun retest ard 422-425. So in case December Wheat gives a buy signal around 425 support, we'll have an inverse Head and Shoulders pattern, with possibly 460-480 target later.
Strategy: wait until ZWZ6 price gets lower to Kijun Sen. Look for a buy signal there. Enter 1 unit long in case of valid signal. Increase to 2-3 units if price confirms and market breaks above 440 later.