IN THE NAME OF ALLAH THE MOST GRACIOUS THE MOST MERCIFUL
THE CRB INDEX REPRESNTS A BASKET OF COMMODITIES AS IT IS FORMALLY IS COMPRISED OF 19 COMMODITIES ISSUED IN THE SECOND PICTURE. THE 19 COMPONENTS EACH CARY A DIFFERENT WEIGHT. CRUDE OIL BEING THE HEAVIEST (23%) , THAT CLARIFY WHY OIL AND CRB INDEX WERE AT ALL TIME HIGHS IN JULY 2008. THE FIRST CHART WE‘RE LOOKING AT IS A LONGER TERM VIEW OF THE CRB INDEX THROUGH THE EWP PERSPECTIVE(A LITTLE MORE THAN 90 YEARS, SINCE 1930 ). THIS VIEW SUGGESTS THAT THE CRB INDEX PEAKED IN JULY 2008 AT 474 AS A SUPERCYCLE WAVE ONE THEN , THE MASSIVE DECLINE WAS A SUPERCYCLE 2 COMPLETED AT MARCH LOWS 2020 AT 101. SO THE THIRD WAVE AS KNOWN IS THE MOST POEWERFULL WAVE IS IN PROGESSING , AND SHOULD EXTEND PRICES HIGHER ABOVE THE OLD PEAK 474. THE RECENT RALLY IN FIVE WAVES UP WITH THE BULLISH DIVERGENCE ARE CONFIRMED THAT THE LOW IS IN PLACE. STUDY OF CRB INDEX TELL US A LOT ABOUT GLOBAL DEMAND AND CAN HELP US MAKE DECISIONS IN OUR EVERY DAY TRADING. NOT ONLY THAT, AS LONG AS CRB INDEX REMAINS ELEVATED INFLATION IS NOT GOING AWAY ANYTIME SOON , THAT WILL DEFINITELY AFFECT BASIC NECESSITIES (LIKE OIL, NATGAS,CORN....) AND PRIME COMMODITIES(LIKE COTTON, SUGAR, WHEAT, COPPER,....) (INFLATIONARY PRESSURES)
NOTE: I ALWAYS SAY , THAT ANY DIVERGENCE WETHER A NORMAL DIVERGENCE OR REVERSE DIVERGENCE NEEDS TO BE CONFIRMED IN ONE OF THE WAYS I MENTIONED EARLIER, HERE A NORMAL BULLISH DIVERGENCE WAS CONFIRMED BY CLOSING THE 40-WEEK MOVING AVERAGE
