Soybeans - March 2016

 This post deals with our March 2016 soybeans roadmap. It mainly discusses the current bottom made on March 1st, including PTV[1] and cycle analysis.

 Cycle analysis

 We discussed the possibility of a market bottom during the month of February due to the turning of Gann's 30yrs cycle together with other small cycles. It seems that instead of bottoming on February, the market turned up on March 1st, 2016 aligning with a harmonic of Gann's 20yrs cycle.
 

Figure 1
Daily cash prices for soybeans at Central Illinois. Gann's 30yrs (red) and 20yrs (magenta) aligning with March 2016 bottom. PTV from July 2012 with length 3x432 completing on March 2016.

 Figure 1 is a daily price-time chart for cash soybeans. It is an update of a chart we presented in our February 29 post. This chart shows the alignment of Gann's 30 and 20 years cycle with the March 1st market bottom and also the completion of a large PTV from July 2012 top of length 3x432 or 1296 on that same date.

 From Figure 1, the reader can see that on March 1st, 2016 the market made a double bottom against September 22nd, 2015 bottom. Hopefully, after having completed this PTV and the accumulation period would be over and the market will be more active.

 Geometry analysis

 Cash soybeans

 Figure 2 is a daily price-time chart for cash soybeans. It includes several PTV whose lengths are related to the second Square of Twelve.
 

Figure 2
Daily cash prices for soybean at Central Illinois. PTV lengths related to the second Square of Twelve (288) and vectorial partitioning.

 There are several PTVs that suffered vectorial partitioning. The reader can find these PTVs in Figure 2:

 275.63 + 302.62 = 578.25 (2x288)

 155.63 + 130.91 = 286.54 (288)

 212.57 + 76.84 = 289.41 (288)

 Regarding the current bottom, a PTV starting from the May 22nd, 2014 completed with length equal to 2x√2x288.

 May soybean Futures

 Figure 3 is a daily price-time chart for May soybean futures from late 2014 until the present time. It includes several PTVs related to the first and second Squares of Twelve. The price-time vectors with lengths related to the first Square of Twelve are drawn in red color. The magenta colored ones are related to the second Square of Twelve.
 

Figure 3
Daily prices for May soybean futures. PTV lengths defining up and down swings with lengths related to the first (red) and second (magenta) Square of Twelve. Gann's 30yrs (red) and 20yrs (magenta) cycle harmonics aligning with early March 2016 bottom.

 There were several vectorial partitions present during this time. The reader is encouraged to review these PTVs on his own.

 It is interesting that the last completed PTV which defined the decline from Nov 2014 until Mar 2016 equals 402.9 or √2x288. Additionally, the sum of this vector with the one defining the rally from Oct to Nov 2014 equals the fourth Square of Twelve (576). This is:

 166.72 + 402.9 = 569.62 (4x144 or 2x288)

 Summary

 The most important cycle due to turn during March is Gann's 20yrs cycle. This cycle together with Gann's 30yrs cycle aligned with a market bottom. It could potentially signal the end of the current accumulation period and move prices higher. There is another harmonic of this cycle turning on late March, early April as well.

 If our initial analysis presented in our 2016 soybean roadmap is accurate the market could rally for 3 months until June 2016.

 [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.

Next post: Update: Soybeans - March 2016 

 Ricardo Da Costa

 Grain Market Analysis