Soybean Elliott Wave OverviewSoybean prices have fallen to their lowest point since September 2020, continuing a long-term downtrend that began in June 2022. The most recent decline started in May 2024, erasing the gains made between February and March 2024. Although a short-term corrective bounce is possible, the overall outlook suggests that the commodity will likely continue its downward trajectory over the next few months.
Daily Chart AnalysisOn the daily chart, a significant bullish impulse wave, which began in May 2019, peaked at 1785 in June 2022. Since then, prices have entered a corrective phase, adjusting the long-term upward trend. This decline from the 1785 peak is a zigzag A-B-C (circled) pattern. Wave A and B (circled) were completed at 1249 (October 2023 low) and 1398 (November 2023 high), respectively. Wave C (circled) is now unfolding downward, with waves (1) and (2) of 5 (circled) already formed, and wave 1 of (3) currently in progress. The price is nearing the critical 1,000 level as it works to finalize wave 1 of (3). A corrective move for wave 2 of (3) is expected to start soon.
H4 Chart Analysis
On the H4 chart, wave 1 seems to be close to finishing an impulsive wave pattern, with the 5th sub-wave likely forming an ending diagonal that could signal a reversal. Before any significant movement occurs, a bullish confirmation for wave 2 is necessary. The ideal trading approach at this stage is to wait for wave 2 to complete, then look for SHORT opportunities as wave 3 of (3) begins, provided the 1288 wave (2) high remains unbroken.
Conclusion
In conclusion, the Elliott Wave analysis of soybeans indicates that while a brief corrective bounce may be on the horizon, the prevailing bearish trend is expected to persist. Traders should be vigilant for SHORT opportunities following the anticipated wave 2 correction, particularly around the key 1,000 level. The larger downtrend remains in place, and the completion of the current wave pattern will offer further guidance on the commodity’s future direction.Technical Analyst : Sanmi AdeagboMore By This Author:Elliott Wave Technical Analysis: NextEra Energy Inc. – Thursday, Aug. 1
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