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Soybean's Surge to Record Highs: Getting to Know You... ALL About You

Last October, a telltale Elliott wave pattern paved the way for a boom in soybeans. Soon after, history was made

by Nico Isaac
Updated: June 15, 2022

June 10 may have been just any old calendar day for you. But for my partner and me, it was the first time in a 13-day long Covid quarantine that we finally tested negative!

13 days, 312 hours. He and I, holed up in my 400-square-foot, one room studio apartment with my two cats, a single work desk, and a 4 am, horn blaring CSX train running parallel my driveway. It was, to say the least, a crash course in getting to know each other. About three-quarters in, we could accurately predict certain patterns of behavior based on specific triggers.

When he was sleep deprived (thanks to said train!), he'd work in a kind of hibernating possum-like trance, sitting stiff and upright, eyes open and typing yet unresponsive to outside sounds.

When I was tired, I'd tie my hair back with a chip clip and pour soymilk onto my waffles.

When he was irritated, he'd unroll the yoga mat and do mind-centering poses.

When I was irritated, I'd go into the kitchen, channel my best British Baking Show contestant, and make enough curd pots and pinwheels to feed the Queen's Great Court.

Recognizing these patterns in each other was key to successfully navigating the small space we shared. And we grew stronger as a couple for it. (I can't say the same for my two cats, whose behavioral patterns are about as subtle as a spiked wrecking ball).

Now, think about the last time you interacted with a price chart. What did the chart tell you about the market's trend? (No, I don't mean the price chart spoke to you though day 3 into my Covid DayQuil haze, I might have thought as much!)

What I mean is, did you recognize a pattern on that chart that indicated whether price action was, say, entering a period of fatigue or strength?

Because that, dear readers, is the essence of Elliott wave analysis. This model observes the trends in investor psychology that drive markets trends, and identifies Elliott wave patterns directly on price charts.

Take, for example, the soybean market.

Late last year, the grain complex experienced a lengthy period of weakness on the way to multi-month lows. In the October 2021 Monthly Commodity Junctures, editor Jeffery Kennedy recognized the telltale traits of a certain pattern unfolding for soybeans, which opened the way for a rally. In Jeffrey's words:

"The personality of the price action we've seen to the downside in the grain markets, certainly soybeans, still maintain a clearly corrective, or countertrend personality: Sloppy, choppy, very slow action and two, contained within parallel lines.

"I do like that idea that our fourth wave move is complete and if everything goes according to plan as we move into December and January of 2022... basis the continuation, we ought to expect a move up to the $18 handle."

Soybeans CBT Comb - Cont Liq - 2 weeks bars - 10-22-21

In November, beans reached their bottom: that month's Monthly Commodity Junctures confirmed the completion of the fourth wave:

"This argues that the larger trend is in force, and that we will see prices continue higher"

Flash ahead, and the chart below captures beans' powerful rally to record highs on June 13.

Soybeans CBT Comb - Cont Liq - 6-17-22

Navigating financial markets is a test of patience and perception. Elliott wave analysis allows you to stand back, observe, and identify a patterned context for price action as it unfolds.

Right now, in the June 14 Daily Commodity Junctures, Jeffrey homes in on soy and spills all the critical beans about where this commodity may be headed. In Jeffrey's words:

"I still believe the advance that began in late 2021 is still very much in force."

Jeff identifies potential upside targets if things "get exuberant" or even "stupid crazy," even as he reveals the critical support range that prices must stay above to keep the uptrend intact.

Of course, trading commodities carries risk and not all Elliott wave interpretations prove correct. Our Monthly Commodity Junctures and Daily Commodity Junctures publications cover both the near-, and long-term bases for the world's leading grains, softs, foods, livestock, metals, energy and more.

See below for more information:

Where There's an Elliott Wave Pattern, There's a Way to Opportunity

When the mainstream experts announce the "dawning" of a new trend, it often signals the arrival of dusk -- because, by the time the public catches up to a new trend, often it's already been in place for weeks or months.

To catch new trends before they emerge, look to the patterns of investor psychology.

Our Commodity Junctures updates you on the short- and long-term wave outlooks for the major players in softs, food, grains, livestock, energy, and more right now, 16+ major commodities in total.

See below to stay in-the-know.

A “Freight Train of Grains” Didn’t Cause Soybeans’ Recent Price Crash. So… What Did?

"Crash," "sink," "runaway freight train," and ever-lowering "limbo pole" are a few of the phrases used to describe the May selloff in grains, particularly soybeans. But before you blame the "bombshell" May 12 USDA supply/demand report for the slide, you'll want to read this first.

Commercial Real Estate: Prepare for a Potential Global Calamity

A lot of the commercial real estate market is faced with a decline in liquidity and falling values. The specter of defaults looms large. In at least one region of the world, there are reminders of the dark days of Q1 2009, as revealed by this chart.

'How people FEEL is how they ACT'

Like all ideas that make you want to slap yourself on the forehead and scream "How didn't I think of that!", the idea behind socionomics is simple: Social mood impels social action. When you know social mood's trend, you can forecast everything from the stock market to culture to politics and more. So, how then do you define the social mood trend? Watch our Head of Global Research touch on that in this video.