The Barchart National HRW Wheat Price Index (HWPI, weighted national average cash price) remains in a major (long-term) 3-wave downtrend. January saw the HWPI post a low of $7.6673, holding above the Wave A low of $7.6159. It’s possible this is another case of the Horseshoe Proximity (Close is close enough), with monthly stochastics at or near the oversold level of 20%. Theoretical Positions: Possibly short from the October settlement of $9.3258 based on a bearish spike reversal peaking Wave B. These positions will be covered if a bullish reversal pattern is completed.
The Barchart National SRW Wheat Price Index (SWPI) looks to have completed its major 3-wave downtrend with the December low of $6.5668. The index consolidated during January. Also note, monthly stochastics have not established a bullish crossover below the oversold level of 20% as of the end of January. Theoretical Positions: New longs could be established near December’s settlement of $7.3383 with sell stops theoretically below the December low of $6.5668 (based on the Head Fake Phenomenon in wheat).
The Barchart National HRS Wheat Price Index (HSPI) looks to be in a sideways pattern with monthly stochastics holding below the oversold level of 20%. Theoretical Positions: Short positions from the October settlement of $9.0518 would be covered with a move to a new 4-month high beyond $9.1549. The next downside target is near $7.6931.
The Teucrium Wheat Fund (WEAT) remains in a major downtrend, though monthly stochastics have moved below the oversold level of 20%. Support is at the January low of $7.23 then the previous mark of $7.09 from January 2022. Theoretical Positions: It’s possible long positions were sold during the spring of 2022. New longs could be established when a bullish reversal pattern is completed.