Soybean Oil: 05/29/2017

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Charted above is my phasing analysis on the Soybean oil continuous contract. It seems evident that we have put in an 18 year cycle low prior to the recent rally witnessed in 2016. I believe that the recent dip that was witnessed in the beans complex is temporary and new highs relative to the 2016 highs are probably around the corner later this year. The subdivisions of the pattern presented above is as clear as the sky in July. Further evidence of an 18 year cycle low is the breach of the 54 month FLD as presented in the chart below. Considering that we were in the final 54 month wave within the 18 year cycle, the breach is indicative of a low of the 18 year cycle rather than simply a low of the 54 month wave. Speculators should begin loading up positions in agriculture since the upcoming environment seems quite optimistic for that sector in general.

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From a longer term perspective the commodity market in general is under a similar cyclical circumstance as it was prior to the 1970s hyperinflation. This gives us reason to believe that not only the beans complex is likely to perform well but the entire commodity market is likely to be an outperformer by a large margin than ALL other asset classes. It is a simple beauty to look at the longer term perspective of commodity and it is certainly exciting to be alive under such critical times in financial market history. Given the recent dip, I believe that longing the beans with a stop loss bellow the proposed 18 year cycle low is certainly a low risk endevour going forward.

Best Regards,

Ahmed

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