We start this week's Overview with the guidelines on "What violates a level". This is under the "ABOUT" section and has been put into previous updates.
These guidelines were key to the Soybeans and Corn on Monday and Tuesday and the importance of the second close in relation to the first one to violate a level.
What violates a level?
With yesterday's rally that closed above 61.8% at 1472.00, it will take another one today above it to confirm the breakout. Provided it does close above 1472.00 the next target is 78.6% of the same move at 1521.00
The second close was above 1472.00, however that day it traded much higher and closed lower on the day and this didn't give us the second close above the first one on the breakout. Even if it had a second higher close, it would have turned the 1472.00 level into a swing point and Wednesday was right back below it, bringing back the downside targets first mentioned.
Right now yesterday's new high is slightly higher than the 61.8% target of 688.00 and hit the 693.75 major Gann square, so today's close is key to the next move.
With another close above 688.00 that also closes above the 693.75 major Gann square, the target area is 78.6% at 724.00 and the 729.50 major Gann square.
In this case, it also had a close above the key area at 688.00, but failed to get the second close above the 693.75 major Gann square and that brought in the downside targets.
Even with all of these levels being pointed out beforehand, this is why we always put this next paragraph in each update.
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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