Soybeans - November 2015

 This is our November 2015 roadmap for soybeans. It includes Gann's 45yrs cycle due to turn in the second half of the month as well as expansion/contraction sequences found in January futures contract.

 Cycle analysis

 Figure 1 is a daily price-time chart for January soybean futures. It shows a harmonic of Gann's 45yrs cycle turning in November 2015. This harmonic has continuously aligned with market bottoms since 2002, as explained in our soybean 2015 roadmap.

 We have calculated that this cycle has a window of tolerance from Nov/14 up to Dec/07. It is 3 weeks wide, hence smaller cycles together with geometry and monitoring tools as momentum are useful to pin point when the cycle will turn.

 

Figure 1
Daily prices for January soybean futures. Gann's 45 yrs cycle turning in November 2015. Sqrt(2) contraction and expansion sequences.

 

 Geometry analysis

 Figure 1 also includes several PTVs[1] from early 2015 up to the present time. The PTVs drawn in red color represent a sequence of PTVs expanding according to the √2 ratio.

 The first PTV in the sequence measures 37.05. Ideally, this vector would measure 36. Taking it as a starting point we can project the length of the rest of the PTVs in the sequence and compare them to the actual lengths measured from real market movements. The next ideal PTV in the sequence is calculated multiplying the previous one by the √2 ratio, for example 36x√2 = 50.91. The actual value of this PTV was 52.39. This process is repeated for the rest of the sequence as follows:

 ideal 36        -> actual 37.05

 ideal 50.91   -> actual 52.39

 ideal 72        -> actual 73.80

 ideal 101.82 -> actual 94.76

 ideal 144      -> actual 148.60

 ideal 203.65 -> actual 197.76

 ideal 288      -> actual ?

 The last element of the sequence so far ends at the September 2015 bottom. The next PTV in the sequence equals 288.

 

 Additionally, the PTVs drawn in magenta are describing a contraction sequence following the same principle:

 ideal 144      -> actual 146.07

 ideal 101.82  -> actual ?

 ideal 72        -> actual 70.37

 ideal 50.91   -> actual 50

 ideal 36       -> actual ?

 Up to this day on November 3rd, 2015, January beans made a low at 875 1/2¢. The PTV from the high of October 14th measures 50, which is very close to the ideal calculated value of the next PTV (50.91) in the contracting sequence. If this low holds as a bottom, the length of the next PTV to be expected, either up or down, should measure close to 36.

 Summary

 We have presented a short cycle analysis for the month of November for the soybean market. There is one important cycle due to turn in the later part of the month, namely a harmonic of Gann's 45yrs cycle.

 In addition, we presented an expanding sequence of PTVs following the √2 ratio spanning from the beginning of the year. A similar contracting sequence seems to be developing at the moment.

 [1] PTV stands for Price-Time Vector. This concept was introduced by Bradley Cowan in his writings. Both PTV and Price-Time Vector are trademarks of Bradley Cowan.

Update: Soybeans - November 2015 

 Ricardo Da Costa

 Grain Market Analysis