While the financial media hangs on every move of the Dow Jones index these days, there is plenty of excitement occurring in other markets around the financial world, too. Take commodities, for example, where soybeans and corn futures markets rocketed upward today (March 25), gaining the most number of points allowed by the Chicago Board of Trade.
Looking at that limit-up price action, both the mainstream financial media and our own Daily Futures Junctures editor Jeffrey Kennedy analyzed the Soybeans market this afternoon. But what they discovered, as you might expect, is as similar as night and day.
Relying on the old faithful theory of supply and demand, mainstream analysts found the answer they were looking for in the news of farmer protests in Argentina, the world’s third-largest soybeans producer behind the U.S. and Brazil. Farmers' protests = supply constraint = higher prices.
Question: If tomorrow the farmers go back to their fields and production in Argentina resumes, will soybeans automatically fall, as production rises?
Don't bet on it. If you’ve watched futures markets long enough, you know they don't always respond to supply/demand data as they "should." While today's news may indeed "fit" a market move, if price moves in the opposite direction tomorrow, the same news will be all but forgotten.
In other words, if you’re relying on the news for developing a trading strategy, you could be in for one frustrating ride.
With that in mind, take a look at what editor Jeffrey Kennedy has to say about Tuesday's big move in soybeans in tonight's Daily Futures Junctures (March 25; online now):
“Wave patterns look promising and there is a lot of evidence supporting the idea that wave four is over in [soybeans], but we still have some hurdles to overcome.”
Now, if you’re at all familiar with the Elliott Wave Principle, you know that a fourth wave is a corrective pattern that is followed by a fifth, and final, wave. Which means that soybeans are on their way up all right – the only question is just how high prices can go.
Well, in tonight’s Daily Futures Junctures, Jeffrey gives you exact price targets and a point at which his analysis will either be confirmed or proved inaccurate. No messy guessing about what Argentine farmers may or may not do – just objective, calculated price projections.
See it all online now – plus a 6-minute analysis video – inside Tuesday's Daily Futures Junctures; risk-free, as always. Just scroll below for details.