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Commodity Train To Opportunity: Soybean Meal
It’s another typical day in Grand Commodity Station, where passengers step aboard two very different “trains” of opportunity. Their destination: Soybean Meal.
Departing from the first platform is the “F” -- or, fundamental --train. Riders on this line are running a bit late as uncertainty surrounding upcoming weather conditions throws a wrench in the wheels. On this, the following news item from Thursday, July 31 explains the cause of the delay:
“The market struggled to sustain price direction, with stressful, hot dry forecasts for the US Midwest through the weekend providing support; while outlooks for widespread appreciable rain next week applied pressure… The weather forecast can change quickly so traders remain hesitant to take aggressive positions.” (Futuresource.com)
Leaving the other platform is the “EW” – or, Elliott Wave – train. Conducted by Elliott Wave International’s senior commodity analyst Jeffrey Kennedy, this line is moving along at a rapid pace towards its final stop: Near-term opportunity.
(Soybean Meal: Since soaring to a fresh, contract high on July 11, soymeal prices have taken the southbound route to a near two-month low. Now, the July 31 Daily Futures Junctures reveals how low this market will go. Learn More)
But you don’t have to take my word for it. The past performance of Jeffrey Kennedy’s “EW” train speaks for itself. Case in point: On Friday, July 11, soaring soybean meal prices jumped tracks from a fresh, contract high – to – a two-month low.
And, on the very day of the market’s most recent peak, the July 11 Daily Futures Junctures Weekly Wrap-Up presented the following close-up of soybean meal. (Some Elliott Wave labels have been removed for this publication.)
For those of you new to our pages, the dominant pattern at large on the price chart is called a “Double Zigzag.” Here, Elliott Wave Principle – Key To Market Behavior handles the definition:
“A single zigzag is a simple three-wave pattern labeled A-B-C… the top of wave B is noticeably lower than the start of wave A. Occasionally, a zigzag will occur twice, or at most, three times in succession. In these cases, each zigzag is separated by an intervening X, producing what is called a double zigzag (or triple zigzag)."