Soybean Elliott wave Analysis- recovery before fresh sell-off?

March witnessed a subtle recovery in Soybean prices, sparking curiosity among traders. However, within the context of Elliott's wave theory, this uptick may be a minor reprieve in a broader bearish trend. Analyzing the intricate wave sequences suggests that the Soybean's trajectory could soon resume its descent into lower-price territories.

Soybean Elliott Wave Technical Analysis

Exploring the Daily Time Frame:

Since June 2022, Soybeans have been ensnared in a corrective phase following a bullish impulse wave from May 2019 to June 2022. Currently, the ongoing correction seems to be shaping into a zigzag pattern, particularly denoted as waves A-B-C in blue (circled). Wave A concluded in October 2023, marked by a diagonal pattern, followed by a shallow correction for wave B. The descent resumed in November 2023, initiating wave C. Notably, blue wave C appears to be approaching its latter stages, currently correcting upwards within wave (4) of C. However, wave (4) has yet to reach its peak, necessitating close observation to determine its completion.

SoyBeans Elliott Wave Analysis 4-Hour,11 March 24

Zooming into the H4 Time Frame:

A detailed examination of the sub-waves of wave (4) on the H4 timeframe reveals multiple potential scenarios. The surge from the low of wave (3) hints at a corrective movement akin to a zigzag pattern, possibly a double or triple 3 pattern. It's conceivable that wave (4) might extend towards 1200 or higher, aligning with the 38.2% Fibonacci retracement of wave (3). While a climb to the 50% retracement level at 1258 is plausible, exceeding this threshold is unlikely, as fourth waves typically correct within the range of 23.6% to 50% of the preceding third wave.

Key Considerations for Traders:

Traders must exercise vigilance, especially around the mentioned price zone during the bullish correction of wave 4. Monitoring subsequent price action in this region is crucial for validating forecasted trends. A decisive bearish reversal from this zone could signal the conclusion of wave (4) and the onset of the anticipated bearish decline from June 2022, constituting wave (5) of C.

Conclusion: In conclusion, while the recent recovery in Soybean prices may offer temporary relief, the broader Elliott wave analysis suggests that a more profound downward trajectory might be on the horizon. Traders must remain attentive to evolving patterns and price movements to navigate potential opportunities and risks effectively.

Technical Analyst: Sanmi Adeagbo

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