The cash soybean market is studied following the theory presented by Brad Cowan in his published works. Several important turning points in the market aligned with different Gann cycles, showing a correlation between them and major tops and bottoms. A more detailed view and analysis of the cash soybean market is performed from 2013 onwards including several projections of possible turning points dates for 2014.
Figure 1 contains a weekly price-time chart of cash soybeans at Decatur, Illinois. It shows that, after the energy level increase in 2001, major tops and bottoms in the soybean market have aligned with harmonics of Gann's 45 years cycle.
One of these harmonics recently bottomed on Nov 5th 2013. The next occurrence of this cycle will take place in 2014. According to the triangle wave pattern from Figure 1 it is probable to expect a cycle top in November 2014. However, what is crucial for the analyst and trader is knowing when to expect a turning point, even if an inversion occurs, as it did in March 2009.
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| Figure 1 Weekly cash prices for soybeans at central Illinois from 2002 to 2014. Harmonics of Gann's 45yrs cycle. Triangular wave pattern showing alternating up and down trends correlated with a harmonic of this cycle. |
2013 review and overview for 2014
Figures 2 and 3 are daily price-time charts for cash soybeans. They are a close-up view of the market action from 2012 up to 2014. They show the major cycle presented in Figure 1 which bottomed on November 2011, November 2013 and its next occurrence in November 2014 together with several cycles that shaped the market in 2013 and will be impacting prices in 2014.
Figure 2 contains harmonics of Gann's 20 years cycle, which are anchored at the July 2012
major top. From Figure 2 it is clear that these harmonics pinpointed several important turning points in 2013.
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| Figure 2 Daily cash prices for soybeans at central Illinois from 2012 to 2014. Harmonics of Gann's 45yrs and 20yrs cycles. |
The reader is encouraged to verify on its own the accuracy of this cycle turning points both in the cash and futures market. The Feb 4th top, the Apr 5th bottom, the Jun 5th top and the Aug 27th top were all exactly predicted with a tolerance of only a couple of days.
Figure 2 shows as possible turning point dates in 2014: Jan 11th, Apr 1st, May 15th and early November. May and November dates should be regarded as more important. It is worth mentioning that between the months of May and August, the soybean market typically makes seasonal highs.
Next, Figure 3 contains harmonics of Gann's 14 years cycle, anchored at the May 23rd 2012 bottom. Since there was a lower final bottom on Jun 1st 2012, this cycle should be regarded carefully by traders as cycle dates could deviate from those presented in the chart.
The Mar 8th top and Aug 5th bottom of 2013 accurately aligned with this cycle. Figure 3 shows as possible turning points for 2014: Jan 5th, Jun 11th and late November 2014. January and November dates should be considered as more important.
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| Figure 3 Daily cash prices for soybeans at central Illinois from 2012 to 2014. Harmonics of Gann's 45yrs and 14yrs cycles. |
It seems that the early January turning point projected for 2014 aligned with a market bottom. Prices could rally, at least momentarily.
The reader can verify that almost every major turning point in 2013 aligned with the cycles here presented. It is worth mentioning that all these cycles project a turning point for November 2014. Hence it is expected that an important change in trend could take place at that time. Based on the triangular wave pattern from Figure 1, a cycle top may be anticipated.
The Nov 5th 2013 bottom may be the beginning of a bull market that could
last from several weeks to several months. Similarly to the bottoms of
September 2006 and December 2008, this bottom marked the completion of
an underlying geometric structure in the cash soybean market. If the market
continues to rally, cash prices could return to their all time highs levels.
Update: January 2014 Soybean Market Outlook
Update: January 2014 Soybean Market Outlook
Nadiel Outis
Grain Market Analysis
Grain Market Analysis
I have been trying to figure out how to use CycleTimer Intraday to generate cycles such as those presented above in Figure 2 for some time (and also inrtaday such as on 29 April post). Is there any chance of a quick overview on how to generate those types of charts?
ReplyDeleteThe cycles from Figure 2 were created using the "cycle anchor" tool. Simply select the cycle you are calculating. Then use the "cycle anchor" tool by clicking and dragging over the desired start date. For additional cycles click on "add another cycle" tool and repeat the process.
DeleteThe cycles from the April 29 update were calculated exactly in the same way, except that the "cycle dynamic compression/expansion ratio" was set to 0.5 or 0.667 (I don't remember exactly). This "compression/expansion ratio" can be set in the "manual" menu.
CycleTimer software comes with a tutorial. I strongly recommend you (and everyone) to follow it from start to finish, trying to replicate the charts and examples. Not only you will learn to use the software, but Cowan included additional information about market analysis that is not found in the home-study courses. It is worth it.
thanks very much for taking the time to reply, i will take a look.
DeleteNo problem.
Delete