Grains and Fibonacci
ONE44 Analytics where the analysis is concise and to the point
Our goal is to not only give you actionable information, but to help you understand why we think this is happening based on pure price analysis with Fibonacci retracements and Gann squares.
You can get all the rules and guidelines to the Fibonacci retracements on our website.
This update covers Soybeans, Corn and Wheat using the ONE44 Fibonacci rules and guidelines. You can follow all these retracements on the hourly charts below.
To start we have to know that all of this action has taken place between the contract high (1480.00) and 38.2% (1230.00) of that high and the 2020 low. When it is caught between two major levels like this, it tends to have wider swings and that the 61.8% rule comes into play more often. The high on 7/27/21 hit 61.8% back to the contract high and the ONE44 61.8% rule, says to look for 61.8% the other way, this was hit on the 28th. The rally from there took it to 78.6% on the 29th. We have mentioned many times that 78.6% can be the start and end to a lot of bull moves, even in a smaller time frame like this. The break from there took it through 61.8% on the 28th, the next rally hit 38.2% on 8/3/21. The 38.2% rule says to look for new lows to keep the current trend intact. The new low from there hit 61.8% back to the 6/17/21 low on 8/3/21. We know now that we should be looking for 61.8% the other way at 1377.00 more on that in a bit. The rally from the 8/3/21 low hit 38.2% back to the 7/27/21 high on the 5th and it had a minor setback from it before making a new high, the break from that new high went back to 61.8% on the 9th and that rally led to 38.2% back to the contract on the 11th. The setback from 1351.00 (38.2%) went to 61.8% on the 12th. The rally from it took it to 61.8% back to the contract high and completed the target (1377.00) from 61.8% on 8/3/21 (1310.00).
The recent high of 1378.00 was 61.8% and using the ONE44 rules we should be looking for 61.8% back at 1335.00, however we always watch all the retracements on any move to see just how weak, or strong the market is. The current rally will turn negative, if 38.2% at 1351.00 is taken out. only being able to setback 23.6% at 1362.00 is extremely positive and with a solid close above 1377.00 look for 78.6% back at 1395.00.
As you can see these are the short term levels, to get the long term levels you can go here.
All of these levels about to be mentioned are between the contract high of 638.00 and 38.2% (514.00) back to the 2020 low. Just like the Beans, being caught between major levels can cause wide swings.
The rally from 514.00 sent the market up to 61.8% at 572.00 on 7/21/21. Knowing the ONE44 61.8% rule, it should retrace 61.8% the other way. This was completed on the 25th at 532.00. Using the same guideline we should again be looking for 61.8% the other way and it did that on the 27th at 558.00 and again we looked for 61.8% the other way and this happened on 8/2/21 at 542.00. The rally from there took it 78.6% at 564.00. Like the 61.8% rule when it hits 78.6% we look for a move of 78.6% the other way, however it was only able to get to 61.8% on 8/4/21 at 542.00.
The report rally on the 12th took it up through 61.8% at 583.00 for one hour and we will look for 61.8% the other way at 540.00, as long as it remains below it. We will watch 38.2% of the same move to see just how weak, or strong the market is at 560.00, holding this level should send them to new highs and with a solid close above 61.8% at 583.00 look for 78.6% at 603.00.
The long term view is also in the link above.
This current rally is also coming from, what was 38.2% (617.00) of the contract high 770.50 and the 2016 low that happened on 7/9/21. It has now gone on to new highs for the move.
The lows that occurred on 8/5/21 and 8/10/21 held 38.2% (722.00) back to the low on 7/25/21. The rally led to new highs as it should after holding 38.2%. The two minor setbacks have both held 23.6% back to 722.00. The first was on 8/12/21 at 759.00 and the second was at 770.00 on 8/15/21.
Holding 23.6% keeps the trend extremely positive and we should be looking for our long term target. It would have to take out 38.2% at 761.00 to make us look at longer term support levels.