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Soybean Meal & Oil, What Keeps The Trend Intact And How To Spot A Trend Change With Fibonacci Retracements

ONE44 Analytics - Fri Mar 1, 5:48PM CST

Soybean Oil

March

(ZLH24) 

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.

From the top made on 7/24/23 it traded down to 38.2% back to the 5/31/23 low on 8/8/23, this kept the trend intact and we were looking for new highs. As always we watch all the retracements on every move to see just how strong, or weak the market is. It failed to make a new high from 38.2% at a 78.6% level on 8/21/23. This sent it 78.6% back the other way on 9/12/23 and it also ended the Bull market.

Each attempt to rally was stopped by a 23.6% retracement on 10/16/23 and 11/22/23 showing just how weak this market was. The second high was coming from holding a 78.6% level for two months at 49.00 and should have led to much higher prices, but failed to get above 23.6% keeping the trend extremely negative. The break became so weak it couldn't even get to 23.6% back to the contract high on 2/8/24, all it could do was rally 38.2% back to the next most important high of 11/22/23 at 48.00. 

This brings it up to date, so here is what to watch for:

Use the 45.79 major Gann square as the swing point for the week.

Above it, look for 23.6% back to the contract high at 48.94, this is also a major Gann square.

Below it, the long term target is 78.6% on the long term chart at 38.50. The short term target is the next major Gann square at 42.88.

We just did another video (38 in total) on how to use the Fibonacci retracements with the ONE44 rules and guidelines for the Soybean Oil.

You Can Find It Here.

Soybean Meal

May

(ZMK24) 

Following the same rules from the Oil update,

The attempt to make a new high on 11/15/23 failed at a 78.6% level. This ended the Bull market. Each of the rallies on 12/12/23, 12/28/23 hit a 23.6% retracement keeping the market extremely weak and just short of 23.6% on 1/31/24.

Use the 330.50 major Gann square as the swing point for the week.

Above it, look for the area of 23.6% back to the contract high at 350.00 and the 353.30 major Gann square.

Below it, look for 310.00, this is 78.6% based on the long term chart.

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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FULL RISK DISCLOSURE: Futures trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Commission Rule 4.41(b)(1)(I) hypothetical or simulated performance results have certain inherent limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not actually been executed, the results may have under- or over-compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. Past performance is not necessarily indicative of future results.


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.

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