Understanding Wheat's Elliott Wave Analysis: A Look into Current Trends
Wheat Elliott Wave Technical Analysis
Function: Trend Analysis
Mode: Identifying Trends
Structure: Impulse for wave (A)
Position: Wave 5 of (A)
Direction: Ongoing Wave 5 of (A)
Details: The recent rise in wheat prices starting from the 523’6 mark represents an impulse for wave (A). We anticipate a continued climb towards the 661’4-703’2 Fibonacci zone, potentially marking the start of wave (B). This analysis follows closely on the heels of our last update.
Wheat's Potential Major Recovery and Market Implications
Since October 2022, wheat prices are nearing a significant recovery point. After enduring a two-year bearish trend from March 2022 through March 2024, the market is now in a corrective phase, poised to outperform past rebounds seen during the bearish cycle. This recovery phase addresses the downturns of the entire cycle, positioning the market for potential gains.
Daily Chart Insights: Analyzing Bearish Impulse and Recovery Prospects
The daily chart reveals a bearish impulse wave pattern stretching from the peak in March 2022 at 1364’4 to a low in March 2024 at 523’6, culminating in an ending diagonal pattern. The breakout from this diagonal has triggered the current recovery phase. While a full reversal of the past two-year bearish trend is not anticipated, it is expected that the recovery will at least approach the 842’2-942 Fibonacci retracement zone. However, the extent to which these levels will be reached or exceeded remains uncertain.
Wheat 4-hour Chart Analysis
Anticipating Price Movements and Strategic Trading Decisions
Our analysis on the H4 chart suggests that wave (A) is almost completing its impulse structure, expected to finalize within the 661-703 Fibonacci extension zone. Subsequently, wave (B) will likely initiate a corrective move downward before the price ascends again in wave (C). As long as the 523’6 threshold remains unbreached, trading strategies should focus on buying during dips, in anticipation of the continued bullish correction.
Evaluating Potential Price Paths and Forecast Adjustments
Determining the precise structural path for the completion of this corrective cycle remains challenging. The pattern may unfold as a zigzag or a double zigzag, following the breakout from the diagonal wave (5) characterized by an impulse structure. Presently, we are forecasting a double zigzag pattern for the bullish corrective cycle, which aligns with the upward trajectory anticipated in both scenarios. As further price action unfolds, adjustments to this forecast may be necessary to reflect new market dynamics.
Technical Analyst: Sanmi Adeagbo
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Conclusion
The Elliott Wave analysis of wheat suggests a structured recovery in progress, with potential for significant gains as the market corrects past declines. Traders and analysts should remain vigilant, adapting strategies as new data emerges, to capitalize on this evolving trend.