Hot Summer for Winter Warriors

DBA, the ETF for a basket of soft commodities, is turning in a strong session as I write this, quietly printing seven month highs today. We have been quite bullish on wheat for a while now. And you can see on the second daily chart, below, DBA is sporting an explosive-looking base breakout pattern. What makes this setup even more menacing to the upside is that so few people actually pay attention to soft commodities. Instead, oil has understandably garnered virtually all of the attention with the Iran War. 

But as we have been noting consistently both here with Members, the supply disruptions out of the Strait of Hormuz absolutely makes a shortage for fertilizers and ag-related chemicals extremely concerning in the coming months. 

Another interesting tidbit about DBA is that it actually "doubles up," so to speak, on wheat. Of the top ten holdings in the ETF, we have both CBOT Wheat Futures and KCBT Hard Red Winter Wheat Futures (it may not be such a fruitful harvest, by most accounts, this year). 

Also of note is that first chart below, of gasoline seasonality. From here until Independence Day it is as strong as it gets. And the Iran War only exacerbates this setup, coupled with how many folks are convinced that the highs of both oil and gas have already been printed.