In our last update we mentioned what it would take to get out of a 78.6% trading range that Soybean Meal and Wheat were in.
From last week,
Use 754.00 as the swing point for the week.
Below it, we will use the ONE44 78.6% rule to give us the downside target of 78.6% the other way at 665.00 (now 669.00)
A sign the market is ready to get out of the wide swings (other than taking out a 78.6% retracement) it will usually hold a 38.2% retracement, as this is always a positive sign, so watch 691.00 ( now 701.00) in the Sept. and 710.00 (now 720.00) in the Dec.
The setback in December Wheat from 754.00 (78.6%) could only get back to 38.2% at 720.00, it did have one close below it (always need two to violate a level) and Sunday night it opened right back above it and went on to a new high as it should after holding 38.2%, a 75 cent rally.
From last week,
Use 420.00 as the swing point for the week.
Below it, we will use the 78.6% rule again for the downside target and this is 385.00. Just like Wheat, other than taking out the 78.6% level above at 420.00, the sign that the market is getting ready to get out of the wide swing is, it holds 38.2% at 405.00.
The setback in December Soybean Meal from 420.00 (78.6%) could only go 38.2% back at 405.00, it did trade below it, but never closed below it and it made a new high for the move.
Here is our video to help you with the 38.2% and 61.8% retracements.
Being this is a weekly update we give all the key levels to watch for the week using Fibonacci retracements and Major Gann squares. We set up scenarios to look for when a level holds, or fails based on these methods, so it is very important to know for yourself how to use them following the ONE44 rules and guidelines. The best way to get a better understanding of these methods is to read all the posts (even if not on Grains) and watch our YouTube videos, as we explain why we think what we think based on the rules and guidelines. It is also important to view all the charts, as they have the key levels marked on them, if there are extended moves.
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