Following a short update on the current soybeans market situation. This post presents a couple of Velocity Price Projections and a 2-day swing chart.
Figure 1 and Figure 2 [1] are daily price-time charts for soybeans July futures. Figure 1 shows the velocity curve and a couple of Velocity Price Projections. Figure 2 shows a 2-day swing chart together with some relevant trend lines and common price retracements.
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| Figure 1 Daily July soybean futures for 2015. Velocity Price Projections. |
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| Figure 2 Daily July soybean futures for 2015 for 2015. 2-day Gann swing chart together with common price retracements, trend lines and 2% rule stop loss from last bottom. |
Figure 1 shows that an initial price target was reached at 985 1/4¢ on April 23, 2015. The market reacted for a couple of days making a swing high, then turning back up again.
The next Velocity Price Projection at 996 1/2¢ was reached on April 30, 2015. Figure 2 shows that this level was also equal to a previous important swing top at 997 1/2¢. Additionally, it was the 50% retracement from the March 2nd top. From there the market reacted strongly.
Figure 2 also shows an example of a trailing stop loss order calculation following the 2% rule from the April 10, 2015 bottom. As mentioned in our previous post we figured it was possible the market would react. If our general assumptions are correct, hopefully into acceleration bottoms in May taking the market into their seasonal summer tops in June-July.
Summary
A short update was presented regarding the current market behavior of soybean futures. Velocity Price Projections and a 2-day swing charts were used.
Our May 2015 roadmap indicated that there is a cycle turn date in early May. It is possible this will align with a market bottom.
[1] Chart from Figure 2 drawn using free charting software Gannalyst Professional 5.0 which includes several basic Gann techniques.
Update 2: Soybeans - May 2015
Update 2: Soybeans - May 2015
Ricardo Da Costa
Grain Market Analysis
Dear Ricardo, I noticed on your velocity chart, you have two values, 1/2:phi & 1/4:1 any tips on how you obtained these values, currently i'm using CSI data, where do you obtain your data??
ReplyDeleteThanks
Stephen,
DeleteIn the velocity chart you see two price targets, namely: 985 1/4¢ and 996 1/2¢.
These targets were calculated taking in consideration market velocity. The idea itself is simple, as stated by Cowan and Gann: We can assume the market moves following the laws of simple harmonic motion (at least in some degree). But explaining how I developed these calculations is not that simple to explain.
You also see the number 1 and phi next to the price targets. These numbers are related to the way the target calculation is performed. They are not very important. The price targets are the ones that matter for practical purposes.
I use a data provider called Genesis mostly for futures contracts. I get the cash values directly from the USDA website. I update my cash data files manually. I think it is more reliable.