Today is Sunday, April 14th and we are summing up the trading week results.
Profit, $: Cocoa +1,290.
Loss, $: Silver 1,237.
Wheat: long position – 1 contract.
Let’s consider last week’s deals in details.
Setup for Cocoa was on week 14th. Now the price has approached the resistance level (blue line). According to the indicator Sentiment, the Public is in long position. The cocoa price was stronger than seasonality. However, the price is now at such a moment for seasonality that it can rise.
On Monday, we closed the expiring contract (profit $ 1,590) and rolled over to a new one (CC-201907). The position of the new contract was closed on Tuesday by stop loss (loss $ 300). The total profit for this trade is $ 1,290.
On Wednesday, one inside day was formed with a close up, which can indicate a reversal in the nearest future. There was a fall on Thursday. Friday was also the inside day with closing up. It also suggests that correction of cocoa is possible.
The indicator of Demand Offer shows the correction as well. We see that the price made new high and the indicator decreased. This is a divergence and it indicates a possible correction.
So, we are waiting for cocoa correction. We plan to re-entry the long position. Most likely it will be in %R. If the resistance is broken through (blue line in weekly chart), than the way to the value of 3000 will be open.
Wheat (open position).
SetUp for wheat was published in the Weekly Trading Plan W12. Wheat has down trend. The price is still in the flat for 4 weeks as well. We expect a good way out.
Where can the price go? The current setup is to buy. Quick sentiment is down and shows to buy. According to the seasonal trend, the price should go down, however we are ready for a big move upwards. Let me explain why.
Wheat has a 16 month cycle. The cycle depends on the interrelation of economic factors and public emotions. Economic factor in our COT strategy is Commercial. Public emotion is small players, i.e. we are with you. We get a cycle putting these two parameters on the price and we can predict the price movement on large timeframes. We use this if cycles are traceable.
Now wheat is in the low of the 16-month cycle, where Commercial are in the positive zone (red chart), i.e. to buy, and the public is trying to sell the tool (green graph). Green vertical lines indicate situations when both factors above worked. Yes, in some places there is a delay, but we need to understand that this is the monthly timeframe and we do not buy on red candles, we buy on green candles.
We put crosses in situations where not all the factors were in the positions we would like to be, i.e. either the public was not tuned to strong shorts, or the Commercial were not in the positive zone.
Now there is a good time to buy long term. And that is why we are now considering wheat to buy.
Last week we had two orders for wheat. We talked about this in a group for subscribers. One trade was speculative with a short stop loss. It was closed at a loss of $ 1237.5. Our second trade is planned for the long term and stop-loss is placed further. The long-term trade is currently open.
We plan to restore the position at the resistance levels (blue line). We need to understand exactly that the price went out of the flat based on impulse and will not fall again.
So, for wheat, we are planning to entry a long position on the impulse and break through the resistance line.
This is all about the results of the trading week.
To sum up the trading week:
Сocoa Profit $ 1,290
Wheat Loss $ 1,237
Total Profit $ 53
Today we will plan for the upcoming week and consider new setups.
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