Trading the trend: short Chicago wheat futures
Since front month Chicago wheat futures have fallen through their key 557 to 552 support zone, we expect the wheat price to tumble towards the 500 region, and would thus like to go short with a stop loss at 595.
(AI Video Summary)
Previous VIX trade outlook
In this week's "Trading the trend" video, Axel Rudolph shares his latest trading success and offers some interesting options for traders to consider. He explains that traders can either lock in their profits now or adjust their stop loss level to minimise the risk.
He also discusses the volatility index (VIX) and predicts that it may continue to rise. He believes that upcoming speeches by important figures in the financial world could cause some wild swings in the market. This uncertainty can present both challenges and opportunities for traders.
This week's trading opportunity
Turning his attention to Chicago front month wheat futures, Rudolph notes a significant change in the market. A previously strong support level has broken, suggesting a downtrend that has been happening since March 2022. He believes that the price of wheat could drop even further, maybe reaching the psychological level of 500 or even lower.
Based on this analysis, he recommends a short position on Chicago wheat front month futures contracts. He suggests entering the trade when the price bounces back a bit to around 552. He also advises setting a stop loss at 595 to limit potential losses and targeting a downside just above the psychological level of 500. This trade aligns with the identified downtrend in the wheat market.
Overall, this video provides an update on a successful trade in the volatility index and presents a new opportunity to make a profit by going short on Chicago wheat futures. So, whether you're a seasoned trader or just dipping your toes into the world of trading, this information can help you make informed decisions and ride the waves of the market.
This information has been prepared by IG, a trading name of IG Markets Ltd and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
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