Something curious has happened on the way to the “Great Commodity Boom” taking the agricultural world by storm. You know the one: that widespread “Surge In Grains” that is supposedly boosting the cost of everything from beer to wheat bales, hurting everyone from farmers to fermenters, prompting rice riots, and igniting fears of an emergency food crisis.
Well, on the way to said “Boom,” one of the most significant grains out there has been heading d-o-w-n, down. SOYBEANS aren’t just any grain, they are the Grain -- the most widely grown and utilized legume in the world, used to make oil, flour, feed, baby formula – and let’s not forget, BIO-FUEL.
Yet… on May 1, soybean prices plunged to their lowest level in a month. Which gets me thinking: IF a widely held notion such as – “A rising tide lifts all boats” – works one day, but not the next, isn't there a flaw in the system altogether?
Not that that stops the mainstream commodity experts from forging ahead with their fundamental search parties. To wit, this May 1 news item: “Favorable weather conditions in the major soy growing regions of the U.S. pinned prices in negative territory.” (Commodity Online)
One problem: Many of the same growing regions and climate conditions that apply to soybeans ALSO apply to corn -- yet the uptrend in the latter grain’s prices has continued unabated.
I repeat: there is a flaw in the system of mainstream commodities' price analysis; namely, it does not treat individual markets individually. The way they see it, if there is a commodity bull bandwagon, all markets are on board.
Such is NOT the case. As several key grain markets rocketed past their March peaks onto even loftier heights, SOYBEAN prices hit their ceiling on March 3, plunging more than 27% to an early April low.
And, in the March 10 Daily Futures Junctures, editor Jeffrey Kennedy set soybeans apart from the rapidly climbing crowd with this analysis: “The fallout from today’s price move is that instead of looking higher in soybeans, wave patterns now indicate that [the most recent rally] has ended at 1586 ½. We can now confidently turn our attention down.”
Days later, Jeffrey included soybeans in the “Featured Favorite” segment of his March Monthly Futures Junctures. His bearish assessment of the grain had not changed: “Now moving forward to the May contract,” he began, “you can see that I have identified the recent peak as the termination point of the [recent] wave up, thereby setting the state for” decline.
Soybeans’ dramatic slide since then speaks for itself.
Now, in the just-published, May 1 Daily Futures Junctures, Jeffrey Kennedy revisits the soybean market to reveal where this grain could be headed in the days ahead. If Jeffrey’s interpretation is correct, the wave pattern underway is what Ralph Nelson Elliott himself called “a wonder to behold.”