My dad always says, “If you really want to stand out from the crowd… walk sideways.”
He’s got a point: Of all the 13 Elliott Wave patterns in existence, the one that pops out the most and is easiest to recognize is the “Contracting Triangle.” The main reason being: Prices simply trade sideways before a trend develops.
In addition to searching for five overlapping waves (labeled A through E) in price charts, another way to spot a contracting triangle is in fundamental news stories about a certain market.
When prices are moving sideways as the triangle forms in the charts, market participants appear “frustrated” because prices seem to “lack direction.” Key phrases to look for are: “Quiet news front” and “Waiting on the sidelines.” And usually, the sideways movement would be attributed to some outside news event.
With that in mind, let’s turn our attention to the real-world action in SOYBEANS futures. From their April 1 low, soybean prices have taken a classic sideways shape. And, according to the mainstream experts, one main factor is behind the back-and-forth, back-and-forth movement: The ongoing dispute between Argentine farmers and their government over higher export taxes.
Case in point: “Until the Argentina strike is settled, the soybean market will be held hostage to each new development.” (Bloomberg)
In the end, it comes down to this: Where the fundamental camp sees Soybean prices being held prisoner, Elliott Wave International’s commodity expert Jeffrey Kennedy sees prices set free for opportunity. Where the one sees a hold-up, Jeffrey sees the steady progress of a contracting triangle toward its resolution.
In the May 28 Daily Futures Junctures, in fact, Jeffrey described the “type of price action” that would signal the end of Soybeans’ triangle and onset of the long-awaited advance.
And, on June 5, soybean prices rocketed over 4.5% to multi-week highs in fulfillment of Jeffrey’s outlook.
Now, in the June 5 Daily Futures Junctures, Jeffrey reveals how high soybeans could fly in the days ahead via written, pictorial, and live video analysis. Read, see, and hear the full story right away via a risk-free subscription.