Soybean Oil 50.00 Target and Why
Grains Overview
The current rallies are showing signs of life in Soybeans, Corn and Wheat, however they have all run into key retracements above. In Soybeans it is a 23.6% (1055.00) retracement, in Corn it is a combination of 23.6% and 38.2% (429.00) and in Wheat it is 38.2% (611.00). We will be watching the 38.2% levels on any setback to see if the trends will continue.
Following the Fibonacci retracements with the ONE44 rules and guidelines will give you the key levels before they happen and why they are key along with what can happen from them.
The chart below is key to this analysis.
There are two methods we use at ONE44 to find support and resistance in the markets.
The first are major Gann squares, these are the yellow horizontal lines on the chart. On the chart you can see where the market turned multiple times at these levels.
The second is Fibonacci retracements and this is what most of this post will be about.
There are a few basic rules when using the Fibonacci retracements with the ONE44 rules and guidelines.
This is the short version.
A 38.2% level keeps the trend intact and new highs/lows should follow.
A 23.6% level shows the market is extremely strong, or weak.
A 61.8% level can cause wide swings and keep the market in a trading range.
A 78.6% level can send it 78.6% of where it just came from and even be the end or start of a Bull market.
We have done 42 videos on how to use the Fibonacci retracements with the ONE44 rules and guidelines. These Videos are worth watching even if it is not in the market you are trading, as the ONE44 rules and guidelines are the same for every market. You will also see why we believe the Fibonacci retracements are the underlying structure of ALL markets.
This is our latest video with analysis on Soybean Oil and the S&P 500 Futures.
This is our analysis for the next week
You will see that the rally started from a 78.6% level, (this is where a lot of Bull runs start and end per the ONE44 78.6% rule) and then the setback held 38.2% at 42.15 to keep the trend intact and why we are looking for 50.00.
Soybean Oil
December
From last week,
The strong rally came from a failure to make a new low in the area of a 78.6% (38.70) retracement and it was indeed the start of a new Bull move. It also has a couple closes above the 43.29 major Gann square and 23.6% back to the contract high, this will be key to the next week.
Use 43.29 as the swing point for the week.
Below it, the short term target area is the 39.40 major Gann square and 78.6% back to the 8/16/24 low at 39.25. Any setback that holds 38.2% back to the same low at 42.15 would be a strong sign and new highs can quickly follow.
This week's low held the tightest support of 38.2% at 42.15 keeping the short term trend positive and this can send it to a new high for the move.
Use 42.15 as the swing point for the week.
Above it, The short term target is 38.2% back to the 7/24/23 high at 46.20. The long term target area is 50.46 to 51.45, in this area is 38.2% on the continuation chart, a major Gann square and 61.8% back to the contract high.
Below it, look for the area of the 39.40 major Gann square and 78.6% back to the low at 39.25.
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, that we believe are the underlying structure of all markets and Gann squares.
If you like this type of analysis and trade the Grain/Livestock futures you can become a Premium Member.
You can also follow us on YouTube for more examples of how to use the Fibonacci retracements with the ONE44 rules and guidelines.
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On the date of publication, Nick Ehrenberg did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.