In this technical blog, we are going to take a look at the Elliott Wave charts of the characteristics of the $ZS_F soybean. As our members are aware, the Soybean features have incomplete bearish sequences in the cycle from the 1784’0 peak. The current view calls for further weakness against the 1671’7 pivot. Recently, the commodity presented us with another trading opportunity. We had 3 recovery waves that found sellers tied as expected. In the following text, we will explain the Elliott Wave Forecast and the Elliott Wave Pattern. Before we take a look at the actual market example, let’s explain the Elliott Wave Zigzag pattern.
Elliott Wave Zigzag is the most popular Elliott Wave Theory corrective pattern. It is made up of 3 swings which have an internal 5-3-5 structure. Inside swings are labeled as A, B, C where A = 5 waves, B = 3 waves, and C = 5 waves. This means that A and C can be impulsive waves or diagonals. (Leading Diagonal in case of wave A or Ending in case of wave C) . The A and C waves must fulfill all the conditions of a 5-wave structure, such as: having RSI divergence between wave subdivisions, ideal Fibonacci extensions and ideal retracements.
Soy $ZS_F Elliott Wave Analysis 25.08.2022
Soybean specs correct the short-term cycle from the 1671’7 peak. The recovery is unfolding as a potential Elliott Wave Zig Zag pattern and looks incomplete at this time. Price is showing a higher high than the lows, suggesting that the rally in blue (B) may see more upside towards the 1610’6-1650’2 area. The target for the end point of (B) blue is obtained by measuring the equal legs of the bottom red A tied to the red B. As the commodity is currently in a bearish cycle, we expect sellers to appear in the mentioned area for further decline to new lows ideally or for at least 3 wave pullback. Once the pullback reaches 50 Fibs against the red bottom B, we will go short risk-free (put SL to BE) and take partial profits. As our members know, blue boxes are not enemy areas, giving us an 85% chance of getting a reaction.
Soy $ZS_F Elliott Wave Analysis 09.07.2022
The commodity rallied towards the target zone and found sellers as expected. Salvage blue (B) ended at 1615’1 high. Soybeans have seen a sharp decline from the blue box (sell zone) to new lows. As a result, members who took crazy positions on risk-free short positions. (Put SL to BE) and took partial profits. The decline from the 1615’1 high looks impulsive and we are now most likely making a 2 red rally.