When you joined the Complete Forecasting and Trading Package, I promised a premium Subscriber Only webinar as a bonus.

This webinar was presented live on Tuesday, March 9, and this is the recording.

Typically, I schedule webinars when there is important information I need to convey which will help equip subscribers to maximize a current market opportunity.  One of the advantages of the 1 hour and 15 minute format is that it gives me the ability to cover a lot of information and marshal all of the evidence leading me to believe a market or markets will experience a major move.

Over the past several months, I have presented a tremendous amount of research as it relates to our extremely bullish posture in overall commodity prices.  In this webinar, I present all of what I believe adds up to a compelling argument for what is to take place.

If I am correct in my forecast for a continued aggressive leg up in commodity prices, the equally critical subject question I will be covering in the webinar will be the trading tactics to maximize profits. At present we are holding what I would term “core positions”.  I look at key price levels and price patterns I believe will provide additional buying opportunities.  If all goes according to plan, we have a lot further to go to the upside and there are some logical price points at which we can pyramid our positions.

In short, if you are currently participating on the long side of these markets, or are looking to do so, you do not want to miss this presentation.

This is the recorded live webinar presented on Tuesday January 19 for Gann Global Insiders.

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During the webinar I mentioned a new upcoming “Subscriber-Caliber” video series.

My intent with this webinar and the upcoming Subscriber Caliber Video Updates is to show you the same content our paying subscribers receive.  This content will very closely mirror the content paying subscribers receive on a regular basis.

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Here at Gann Global we’re dedicated to discerning when the “exceptional” will take place in the financial and commodity markets as opposed to the mundane. The serious rewards in trading or investing are made during the major runs up and down following accumulation and distribution.

This “Video Preview” gives  you insight into:

• Why we have subscribers on “Red Alert” for potential high-reward opportunities.
• Why we’ve patiently waited for projected cycles and price patterns to run their course in the agricultural market.
• If our projections are correct, we’re standing on the threshold of some major advances.
• Why the bearish crop report this week has provided us with a huge assist.
• The fact our current trade action in the agricultural commodities leads us to believe we are on the threshold of potentially extraordinary moves, based on our extensive study of history.
• The incredible parallel between the trade action we’re experiencing in the CRB Commodity Index, and what took place 60 years ago.

While this 10-minute video is filled with valuable information, it is only a PREVIEW of the “Full Presentation”

Click Here to View the Video Recording of the Full Webinar Presentation (Recorded January 19, 2010)

]]> http://www.gannglobal.com/webinar-preview-commodities-explosive-position/feed/ 1 http://www.gannglobal.com/gold-extremely-bullish-long-term-position/ http://www.gannglobal.com/gold-extremely-bullish-long-term-position/#comments Wed, 25 Nov 2009 02:10:00 +0000 msymonds http://www.gannglobal.com/?p=1602

In this video, I show you what is in my estimation, the glamour commodity on the board at this time.  The Crude Oil had its day in the sun into the July 2008 all-time high at $147.00.  The bull market which began in 2001 at $17 a barrel exceeded the 1980 all-time high at $40 a barrel in 2004.  At that time, our projection called for at least a doubling in price based upon the closest fit historic precedents during the great inflationary advances in 1864, 1920, 1948, 1974 and 1980.  Our research is telling us that the Gold market at this time has very similar DNA to the Crude Oil market when it broke out in 2004.

In this video, I show the 36 historic bull markets starting in 1916 which advanced to new all-time highs, and what occurred during the legs up during these breakout advances.  An understanding of this historic research and its implications is what provided the impetus for our long-term bullish forecast in Crude Oil – an advance which would carry price 268% higher.

In summary, the Gold is in an ideal position to “buy high and sell higher”.  Much of the rationale for our thinking is contained in this video.

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We would fully expect that based upon the 1920 precedent, 1932, the Great Depression precedent, 1948 precedent, 1974, and 1980 precedents that there would be a very close association between what’s taking place in the stock market and what’s taking place in overall commodities. We’ve not been disappointed by what’s taken place in the markets. They are moving in tandem, even to the point that they have exactly the same highs in place. As we’ve seen, the crude oil drop to new recent lows, the Goldman Sachs dropped to new recent lows, and the S&P 500 closed on Thursday just 900 points from the recent low.

The break of the low will give us confirmation. We’ve seen this shift, not just in commodity trading and expectations and commodities, but this shift in the stock market and expectations. This is as we would expect during this portion of the economy. One of the things as far as the psychology of the markets, as we had had all of this bullish talk at the top of this rally in both commodities and in the stock market, which was very problematic. I’m going to go into that briefly in this update.

Currently for subscribers, we entered short positions on the electronic session on Wednesday going into Thursday at 917.20. The S&P 500 closed at approximately 893. We have buy stops in place for current subscribers. The risk-reward for this trade is 8:1.

Expectations in Entering S&P 500 Trade

This is what we expected going in. This was the day that we had recommended the trade. This should be the market’s last stand if we’re to move lower. If we are right in our forecast and successful in the trade, the risk-reward stands at 8:1. That was written as of July 2nd.

Also, on 150% long December crude oil put options, we entered those with the market trading at approximately 71.00. We closed into new lows on Thursday. The electronic session carried prices into the mid-65 level, so we are approximately eight dollars off the highs in a heartbeat, in less than a week.

In looking at the S&P 500, the pattern has been quite remarkable. The rally which we experienced off the final low on March 6th exceeded the January 6th bear market rally high. That was our last rally before the final decline into the culmination low on March 6th.

In this rally we experienced a one, two, three minor breakout above that January 6th bear market rally high, followed by a failure to the downside. A ton of buy stops would have been hit on the rally above that January high. It was a defining high on the chart, and technicians placed their buy stops above previous highs so we can be assured a significant number and significant contingent of shorts would have been stopped out and also would have resulted in many people entering long positions on the “breakout.”

On June 30th, this was our comment with regards to, then this minor rally which we experienced which also was a one, two, three above these minor highs. We said “We ran stops above the minor retracement high of 2480 without follow-through,” again, running stops in the market. Meanwhile, in light of today’s reversal, our exit point has become more decisive. In other words, in light of this third failure we entered short positions right here at 917.20, and they pulled the carpet out from underneath this market. It’s going to be very interesting to see what Monday’s trade brings since we’re within a stone’s throw of the low for the move at 884.30.

The comment that we made for subscribers was “The rule of three has now played out twice in the S&P 500, and this market should be in a weak position.”

Stock Market Forecast Using At Cash Prices

In looking at the cash chart here of the S&P 500, what we have is the June 11th high, as I mentioned, at 956.23. These were the corrections which took place in the aftermath of the greatest first legs up in history going back to 1886. Ours is the second greatest legs up in history behind the first leg up from the 1932 lows, the Great Depression low, which was followed by a correction.

That correction in 1932 is represented by this green projection line. What we have and what you can see here is that if we are going to experience a correction in an overall bull market, which is what I believe that we’re in, then the market should hit at least the 830 level based upon the 1938 precedent.

What we’re showing on our short positions, since we have just a 1200 point risk on these shorts, is that if we hit the 830 level, which is a minimum objective, then we would have approximately a 7-8:1 risk-reward on this trade. We would make eight times what we’re risking. That type of a multiple is ideal.

What I wanted to point out, and what we pointed out to subscribers is that while it’s true that in 1932 the correction was much more complex than occurred in these other six precedents, and I’m showing in this chart the S&P 500 from 1932, the first leg up rally high September 7th to the February 27th low, this decline from here to here is what is represented by this projection line in our market.

What you can see here is that initially after this high, this market experienced a very severe decline between September 7th and October 10th. From there the market experienced some sideways trade, then finally the bottom of that trading range was broken and the market moved lower into what was a final capitulation low, a higher low in the overall bull market, a secondary higher bottom.

That, by the way, led to 120% advance to the upside – a secondary higher bottom – but you can see this decline was very painful coming on the heels of the bottom of the Great Depression. The stock market and the economy were still very problematic. We have to understand that our bear market at 58% was the second greatest behind the Great Depression. Our first leg up off the lows was the second greatest behind this first leg up, so it is very possible that our overall decline is going to be a complex and difficult affair for us.

The initial decline relative to the 1932 market is this blue line here. What we have is that this decline from September 10th to October 10th, if we were to unfold in similar fashion, then our market would have the kind of weakness that would carry us down to this level. Now, obviously the market has not confirmed that we are in that same kind of a weak position, but what we’ve conveyed to subscribers is that this market is running behind time. There’s no question that, if indeed we’re in the midst of a correction, gravity can take hold of this market and we need to play catch-up with these other markets.

It’s going to be very interesting this week starting on Monday, July 6th, just to see how this market responds. I believe that Friday’s trade was decisive with respect to the fact that we are in the midst of what should be a very sharp, but possibly short-lived correction prior to what will be a second leg up in an overall bull market. That’s buying at the bottom of a correction prior to a resumption of a bull market. I said this before, and if you’ve not heard our stuff before I’m going to say it for the first time; the reality is that in looking at history, the history of markets, we have over 500 years of daily price data going back, cotton going back to 1812.

We’ve looked at bull markets. Our lowest risk point to enter long positions is once a final low is in place and it’s confirmed that the final low is in place, which we have in the stock market right now, the initial first leg up is followed by a secondary correction, and it’s the secondary correction which is a correction in a bull market that sets the stage for what is the lowest risk opportunity.

In the words of W.D. Gann, the legendary teacher and trader, he said:

“Always look for that secondary correction to be a buyer. That’s the lowest risk point at which to enter long positions in a market.”

That’s because bottom-picking is a much more difficult affair than it is once a market confirms a low is in place and buying on weakness. Just so you know, the great promise that we have held out to us from the markets, if our projections continue to play out, it will be that this will be a sharp correction and sets the stage for a continuation of the bull.

No question, at the top is where you get all bullish news. The media was talking about the recovery and that things were getting better, all the news items coming out as bullish, all the news items coming out down here as negative. If we see a severe correction the news is going to get negative again and that is going to be the perfect point in terms of psychology for us to enter long positions, to go opposite the crowd.

Commodity Price Analysis and the Goldman Sachs Index

Now in looking at the Goldman Sachs index, I want to give a couple of observations here. This was as of June 20th, when we were approximately just after the highs here on June 11th, so this is the observation.

What stock market analysts are unaware of by virtue of not having access to a historic commodity price index during other boom and bust cycles is that stock and commodity movements during this portion of the cycle are joined at the hip. This is what makes a potential importance to this June 11th high so intriguing. This is at a time when prognosticators, economists, the media, and the public are talking about the perpetuation of the current advance. Yes, bullish long term, but short term and intermediate term? Not on your life! That was said prior to recent decline into new lows.

On July 3rd, I said “I view the new low on Thursday in the Goldman Sachs as an omen. We are in the midst of a severe correction. If so, I would expect the media to start pounding the drumbeat of bad news. The media always plays on the investing public’s emotions which are fear and hope, causing them to do the wrong thing at the wrong time

“Not that the media’s at fault. The public demands to hear the why of what is going on which forces the media to give an answer that appeals to the public’s appetite and therefore sells advertising.

“My role is to help prevent you from getting caught up in what I view as a ‘tabloid mentality.’”

Learn to Trade Commodities and the Stock Market

One of the first things that we learn as speculators, and to a lesser extent it’s critical as investors, is that bullish news comes out of the highs, bearish news comes out of the lows. The discounting of mechanism of the market is the stock market. It anticipates what’s happening in the future, so news is simply looking in the rearview mirror. It’s already been factored into market price. That’s the situation as it stands right now. This should be a fascinating week to see whether the stock market does break its low for the move.

The crude oil has the bulls on their heels, both of these markets having established June 11 highs. This is very important. The other thing is that I’ve just produced a video that you can go to. If you’ve not seen it yet, it’s discussing the soybean complex; specifically where the soybeans and soybean meal are which also have a June 11th high and there is an imminent shorting opportunity in those markets.

Stock Market Trading – Current Positions

We are short the S&P, we’re short the crude oil, if all plays out according to plan, these are corrections, albeit severe corrections in what should be sell-offs into what would be higher bottoms. Our information will become most valuable as a publisher if these corrections unfold according to plan, because we fully expect the point at which the secondary low is in place to issue all-out buy signals for investment purposes both in commodities and stocks since they’re both going to be doing the same thing.

Also for speculative purposes in anticipation of second legs to the upside which should be very aggressive based upon the law of action and reaction. The fact that we’ve completed the second greatest bear market in history should lead to a very significant reaction with the market experiencing a very sizeable second leg to the upside. That’s the great promise that I hold out to you as a potential subscriber in looking to that potential buying opportunity. That’s what we have our sights on and we are in a position where we do want, as best we can, to encourage those that are intrigued by what we’re doing.

Stock Market and Commodity Market Analysis Using Historical Data

You’re not going to see this information anywhere else, we know that. It’s not available. Nobody does it. There are elements of it, sure, but not to the degree that we do it in terms of looking at history. We have a research engine, a computer software application that we use that compares the DNA of our market to the DNA of history. We are able to glean from history what the madness of crowds have done, what people are capable of in pushing markets to extremes of optimism and extremes of pessimism. It got a short prior to the bust cycle on July 22nd, 2008. We issued an all-out sell signal in commodities at this level right here.

That was in the crude oil, saying “This will be one of the greatest runaway declines in history,” and that is what has unfolded from here. This rally did not take us by surprise, and this turning point, if we’re correct, and the probabilities of that have gone up significantly as of Friday’s break to new lows. That correction is going to set the stage for a higher bottom, and then up we go in a bull market. So with that, I will let you go. Have a good day and profitable trading. May God bless you.

For subscribers we do have orders that we are working as I speak to enter short positions if certain contingencies are met starting in the electronic session on Sunday night, July 5th.

Key Observations Regarding the Context in Which Soybeans and Commodities are Trading

The soybeans and soybean meal are still trading within the context and are subject to the projected deflationary declines in the stock market and crude oil as well as the overall commodities. The highs in these two markets and soybeans were made on June 11th. From a money management standpoint, any shorts initiated in the soybeans “would be adding to profitable positions in the S&P 500 and the crude oil.” We enter positions on the short side of the S&P 500 at 917.20.

We entered put options in the crude oil with the August trading at approximately 71.00, the S&P closing at approximately 893 on Thursday, and the crude oil actually dropping into new lows in the electronic session on Friday.

We are adding to short positions and that is critical to understand as a money management practicality since we don’t want to go out on a limb and have too much of a core position with respect to just simply shorts. Now, in the soybeans and soybean meal down here, we’re also trading within something of a vacuum. The soybean oil, corn, and wheat have performed miserably.

History shows that when there is a dramatic divergence like this, once the turning points are reached in the strong sisters, which are the soybeans and the soybean meal, the declines are invariably severe as the spreads between the markets realign themselves. I’m going to be showing you the soybean oil, wheat, and corn in a minute.
There is tremendous divergence taking place, and I believe that this is a bearish omen. It’s not only a bearish omen for the soybean meal and soybeans, but it means that those markets can come down very quickly.

Now, this is the Goldman Sachs index. We have Thursday’s low, which is the last trading session before the holiday. You can see that we’ve broken to new lows. This is as we had projected and desired would take place, so very significant trade on Friday.

The soybean complex, in a sense, is swimming against the tide as far as what we perceive to be, at this time, the trend. It can be a very severe correction in the Goldman Sachs index, overall commodity prices, and a severe correction in the stock market.

Looking at the July soybean oil, you can see that this historic bust cycle, the decline which occurred in the oil has been followed by, basically, two legs to the upside here, but very anemic. This market was the weak sister of the soybean complex, but it did not trade in lock step with the soybeans and soybean meal, so the implication is the fact that it has not followed suit.

The wheat hasn’t followed suit, having broken to new lows basis the July this last week. The corn market has not followed suit on the threshold of breaking to new lows. That is a real damper for the soybean and soybean meal party.

We’ve had a squeeze situation in soybean and soybean meal, but all of our work tells us that all of our tops are in place. Now, in the soybean cash, if you’ve seen any of our videos actually going back three or four months, we had projections once this low is in place on March second. Our target zone for the cash soybeans was for the market to rally into this target zone (See video) based upon the 1974 precedent. The 1978, 1949, 1976, and the 2005 precedents don’t actually show a projected top until the latter part of July, but we hit these four closest fit projections so the geometry of our bear market and bull market has matched these four and are the closest fit since 1936, when futures began.

Our projection had been that we would hit this projected area and that could set the stage for a very severe correction. In this short chart, which is the August soybeans, I want to show you what those corrections look like during those five historic precedents. I say this, as was the case in the S&P. If our projections are correct, prices running behind time.
This suggests the market could come down very quickly. These are the angles of the descent which took place during these historic moves. In four of the five the legs down were corrections in an overall bull market. Those are the green ones. The red was a first leg down in an overall bear market.

The probabilities favor that this was obviously a second leg up in a bull market. First leg, second leg, I’ll tell you that this will probably be a correction in an overall bull market and will be followed by a resumption of the advance. We are looking at this as a counter-trend trade, which we only do maybe 10% of the time. Ninety percent of the time we want to be on the long side of markets in favor of the trend.

However, by virtue of the extreme overbought condition, not just in the soybeans, but in the crude oil market, in the stock market, in many of the markets across the board. Certainly all of the energy markets by the law of action and reaction, we would expect to see significant corrections here. Therein lays the impetus for us being on the short side.

You can see that the market, after establishing selling off sharply, an initial little push here, a little bit of a decline, and then just surged the last two or three days of this last week. This puts the market in a very, very interesting position for us in that we closed at 11.54 basis the August, and in a sense, we’re running behind time.

These cycles should be pulling price lower at this point in time, and that means we can play catch-up very quickly. As far as the August soybeans are concerned, I’m breaking it down in this chart and really getting into the minutia because the overall trade pattern here is great for potential shorts.The first observation on July 1st, we exceeded the June 18th high at 11.62. Buy stops were hit on this three-cent minor breakout, but the market immediately reversed lower. This issued a minor sell signal. This is the pit session, by the way.

This is as of Wednesday that you can see that we saw this dramatic reversal to the upside on this first day, gapped up the next day above this minor high on 11.37, moved straight up to 11.65, would have run buy stops at 11:62 making it very difficult on those committed to the short side of the market.

On Friday we opened lower, and I’ll get to that in a minute, then rallied throughout the day to the 11.54 close on Thursday, which was the last trading session. After putting in this July 1st high, I say this: the next day the market opened 21½ cents lower in response to the dramatic selloffs in the S&P 500 and the crude oil. That would have been Thursday.

At the opening of the grain markets, the S&P was down 2100 points on Thursday, which was 2.3%, and the crude oil was down 260 points, 3.8%. The soybeans opened down 1.8%, and that was this open right here, but did not follow through to the downside, whereas the S&P and the crude oil continued making lower lows into the close. This resiliency indicated the market was not ready to give up the ghost; at least, not on Thursday.

It was a very good performance in the face of what happened in the crude oil and in the S&P 500. A very good performance on Thursday for the August beans. Now, notice also on Thursday the low at 11.33 retraced beneath the previous minor breakout high at 11.37.

We saw this breakout above 11.37, on Thursday we saw the dramatic opening lower, a little bit of follow-through, hit 11.33, and then immediately reverse to the upside. So anyone that bought the breakout above this 11.37 had to endure a selloff which would retrace beneath that low.

Any of the technicians that bought on the advance of 11.37 and placed their stops too close beneath this breakout price would have been stopped out on the break to 11.33. In addition, anyone who entered short positions on the decline beneath the 11.37 previous minor top had to withstand an intraday advance to almost unchanged at 11.60 – that’s as of Thursday – and then a close at 11.54.

Whether you were on the long side or short side of the market, it was very difficult conditions. As I said here, this was a difficult day for a contingence of bulls and bears alike. It was kind of a slice-and-dice situation. This is what we like to see in advance of a potential decisive price move in a market; longs and shorts not knowing whether they are coming or going. This is so typical prior to very significant moves that markets can move very quickly. It’s where there is price action, and this is what we look for; price patterns.

We have one here that makes the trade very difficult on both sides of the market, and the market stopping out people on both sides before the genuine move takes place. So the bottom line, starting Sunday’s electronic session if we break the 11.33 low by four cents, I believe the odds would be very high for July 1st having established a very important secondary lower top with the potential for the market coming down very quickly.

If we break this 1133 low by four cents, we should have what will define a very key high on July 1st. Not only that, but the probabilities would be really outstanding that we are going to see a continuation of what should be a very severe correction. In fact, I say the pattern is very similar to the topping patterns which took place in the September S&P and also in the August crude oil.

Now, there is a video that I’ve produced, Dramatic Declines in the S&P 500 and Crude Oil, with respect to what is taking place in the financial, specifically the S&P and the crude oil, which very much plays into the equations as far as the soybean complex. That video is also being produced concurrently with this one, so that is something that’s available. If you’ve not seen that video it does have a very important reflection upon our thinking in the soybeans, so I want to encourage you to see that video as well.

Projections for Agricultural Commodities and Soybean Complex

In looking at the September soybeans I want to make a note with regard to what’s taking place in the distant contracts. We’re into delivery in the July soybeans. The August contract is now the front month trading contract. The September and the November contracts are telling an interesting story as well. The more distant contracts are trading a significant discount to the front July and have been showing relative weakness. This is an indication the bloom is off the bull. We have the spot, the cash, at approximately 12.04. The November is down at approximately 10.18. That means that the new crop, as the result of fundamentals, is discounting the fact that the cash will be coming down. The cash price is going to be coming down, and this is the seasonal time frame for the cash to establish a very significant high.

All of the probabilities point to lower prices. It’s just a question of a price pattern setting up which would allow us to get short, but we have that going into the Sunday night electronic session.

The September soybeans rally has fallen short of this previous minor rally to the upside, whereas the August soybeans actually exceeded it by three cents in the pit session and a little bit further basis the electronic session. We have what would amount to bearish divergence, the relative weakness in the September contract and also the November contract, which has had some major price machinations with the market declining sharply, as of I believe this was Tuesday, dropping to 943½, running under all these minor lows, dramatic reversal to the upside, and rallying above the previous minor high.

This has made life very difficult on both longs and shorts, and that’s what we want to see. So I say here, very volatile trading conditions. This is a healthy precursor to continuation of this projected leg to the downside.

The other part of this equation, which is so interesting, is in looking at the soybean meal. This has been the strong sister of the complex. This is led the soybean’s higher and has been basically the center of the squeeze. There has been a short squeeze there.

The recent run to the upside in August Soybeans appears to be an extreme historic overbought condition as of June 11th, only minor corrections on the way up. We saw this very significant sell-off and we’re in the midst of this secondary rally to the upside.

But what is interesting about Thursday’s trade in the August meal is that unlike the soybeans in the electronic session, we did not move to new highs above the Wednesday high. We made a slightly lower top. As of the close at 382.20 on Thursday we are also closer to these two daily lows, 375.80, than we are in the soybeans.

We’d mentioned that the soybeans hit 11.33. That would be a critical price point and breakdown point for the soybeans. The critical price and breakdown point for the meal is 375.80, and we are closer to that low on a percentage basis than we are in the soybeans. The long and the short of it for us is that meal, which has been leading the bull market, we’re starting to see a chink in its armor.

That’s very critical since it’s the leader and has been the leader. It is subject to the greatest percentage decline once the top is in place, so this August soybean meal contract is likely in the most vulnerable position if we are right in our assessment that both soybeans and soybean meal have their highs in place. We are not sure of these markets yet, but we do have orders that we are working as of the electronic sessions on Sunday, and obviously it should be a very fascinating week this week to see how Friday’s dramatic sell-offs in the S&P and the crude oil are digested. That’s certainly going to play into this soybean equation as well.

I’m not presenting this information from the standpoint of saying, as a prospect, as someone who is not a subscriber, to motivate you in a sense of doing something in the markets. Obviously we are looking for people that will come on board, understand what we’re doing, understanding the proprietary nature of it, the fact that we’re doing work that isn’t available anywhere else.

It’s not because we have a historic database that’s second-to-none. There is a philosophy that we’re always trying to inculcate into our subscribers; the idea of us giving you the trade of the week or the trade of the day is not the point. Overall, if you’ve been listening to us for any period of time you know that as far back as I can remember, prior to the bust last year, we’ve pretty much had the inside track on all that’s taking place, so it’s on that basis that we’d love to have you come on board as a subscriber.

We’ve seen this dynamic inflationary move to the upside with the S&P 500. The stock market advancing 42%, the crude oil advancing over 100%; all of the markets inflating together, but our projections are calling for a major correction to take place. We are at, what could be, a very key inflection point for that correction to start.  At present, up until coming into yesterday, we had been long the soybean complex believing that that was going to be one of the leaders in terms of this inflationary push to upside, which we anticipated.

Soybean Futures Analysis and Trading

In looking at the soybean cash chart, these were the projections that we had placed on the market based upon the historic precedents which had the same DNA as our market; the 1974, ’78, 1949, 1976, & 2005 markets.

These were the angles of ascent during those advances in those years, and we had put these angles on the chart back somewhere in April so you can see that the price curve has followed it almost perfectly, rallying to as high as almost 1228 on June 1st. The target zone with all four of these four particular markets called for a push possibly up to 1264. We are basically in the neighborhood with respect to the final top in the soybean, so we took all of our profits in up to yesterday.

We are completely out of the soybean complex at this point in time, but more than that, we are looking to reverse positions and go short. I’m going to give you the rationale for that. In this table (see video) I show every runaway move to the upside in soybeans in history, since 1936. This move that we’ve had off the March 2nd low to the June 1st high has been a runaway move defined as a very aggressive move with only minor corrections on the way up.

These are the most profitable moves that history has to offer in any market. When you see very aggressive runs to the upside, in this case to the upside, you can see that on the way down that this was a runaway move to the downside before you experienced a correction. Runaway moves are really the prize in any market whether to the upside or the downside. We’ve cataloged every runaway move in history in the soybeans.

In this table (see video) we sorted by the length of time with which the time periods, or advances, took place. Our advance off the March 2nd low, which is the start of the runaway at 841, to the June 1st high at 1227, experienced a 46% advance in two months and 30 days. Almost three months. We show the time periods that we have equaled or exceeded in our market. The shortest time period was one month, three days; and the top of this was three months, one day, which as of June 3rd, today, we would be three months and one day from the lows.

You can see here that there are only 12 markets, 12 occasions in history, out of 45, approximately 25%, which exceeded three months and one day. You can also see that the next five were complete within three months and five days; that would be June 7th.

What am I saying? We are very mature in this runaway move and we would be looking to be very cautious about long positions which we have taken profits in as a result. This is one of the reasons that we did that. Yes, we can see some higher trade. Four of the precedents advanced as much as three months, 20 days, and these were the aberrant moves which exceeded three months. We know that we’re very mature in this runaway advance. In other words, in our case, we are looking to take profits but now looking to get short.

In looking at the percentage advances, we sorted that same table by the overall percentage advances during those runaway moves; our advance being 46%. You can see that there are only 12 advances which have exceeded ours in terms of percentage terms. This is a very pricey move, so to speak; an overbought situation.

Based upon both price and time, it’s time to look for a turning point. In this case we would look at it in anticipation of a bull market correction, to see a significant correction.
That being said, the next question that we want to ask in history is, of our five historic precedents what were the declines which took place once the top was in place in the runaway advance?

The June 1st high was 1227. That’s the high for the move basis the nearest futures. Is that going to be the high for the move? We could move incrementally higher, that’s a possibility, but we’re running out of time, at least based upon history, to do so. At least the probabilities would be very low for that.

If indeed we do have a high on June 1st of 1227, what we have here is the price curves of the five closest fit precedents based upon 1936.

You can see in the video, I’ve whited out what the objectives were to the downside. I’ve also whited out a specific trade recommendation for subscribers, but what we have is what I believe is a very high probability that this market is, if we don’t have a high at 1227 then we are very close.

We are sitting on the edge as far as recommendations for our subscribers to enter short positions. In fact, I have a recommendation today, Wednesday.

One of the comments I make here is, “Given the extreme velocity of the moves we continue to experience, I believe the odds greatly favor an angle of descent reminiscent of 1949, 1974, and 1976.” That is these angles of decent right here. In fact, there are two that exactly overlap one another, and that’s why it’s dark here.

“This is especially true if a serious correction is in the offing for the stock market once the current leg up is complete. As you know, that is my expectation.”

Looking at the soybeans, it is within context of what is taking place in the other markets. If a correction occurs in the stock market from what is also extremely overbought condition, up 42%; also in the crude oil which has advanced off the lows in December over 100%, if we see corrections in these markets, they should move in tandem and that would also reflect negatively on the soybeans, and the soybeans would be subject to that deflationary psychology. That is a favorable fundamental with regard to the context within which soybeans are trading.

Now, looking at the November soybeans, this is the new crop which is always important to watch at this point in the season. We rallied to as high as 1088, and we regained this low on September 18th.

We pointed out to subscribers that that would be a logical objective to having regained that low. If we reversed lower from here the market could be in serious trouble.

The July soybean meal, which has been far and away the leader, the strong sister in the soybean complex, this chart actually issued a sell signal in the last couple of days. We exceeded this 392.20 high, initially hit 392.40 then exceeded it fractionally to 393.90 on June 1st.

You can see that as of the close on Tuesday, June 2nd – I’m coming to you before the opening on June 3rd – we sold off a little bit, but this has just been an incredible aggressive move to the upside.

These are the comments that we made the day of the high. “Important pit had broken in the 392.20. The only resistance above that is the all-time high of 434.90. This would be a logical point for the market to fail.” In other words, our current price point is a logical point for the market to fail.

“However, we must contextualize what is taking place.” So what I was telling subscribers was “Yes, looking at the soybean meal in isolation we have a sell signal, but we have to understand that given the extreme moves that we are seeing across the commodity board in all of the markets as well as the financials and the stock market, we are subject to all of these markets moving together in tandem.”

Our final comments today; “We experienced a second rally into new highs above the 393.20 high. If price fails from here an important price could be in place.” That was as of the high. We’ve seen the market come off to 384.70 when this chart was captured, and so it will be very interesting to see what happens Wednesday with regard to whether that sell signal at the high winds up being valid.

Stock Market Trading For Subscribers

As I speak, this is a critical, critical juncture with regard to specific recommendations to subscribers.

In looking at the S&P 500, we’ve pushed above a very critical high, this January 6th high, which was the last bear market rally high. The DNA of this advance, what we’ve experienced off the March 6, 2009, low, is a bull market first leg up. All the DNA points to that based upon price patterns in the 1886 stock market. The logical point for us to have targeted was a move above the January 6th high, so we triggered all the buy stops of overextended shorts.

Those on the short side are betting on a depression, or whatever psychology was motivating them, while the logical place for technicians to place stops above a previous high so we have fractionally exceeded those highs based upon the June contract, which I believe I have. We exceeded the high by about 1150 points so we can be assured that a significant number of shorts have been run out of the market.

That being said, if the S&P turns lower from here that is going to be very favorable to our targeted short position in the soybeans.

The same can be said of the dollar index. The other day we dropped to 7837; that was on June 2nd, so we broke this December 18th nearest futures low. We haven’t broken the cash low. If we reverse higher from here, that would be negative presumably for commodity prices. Again, that’s a very tactical price point which was reached.

A lot of technicians or technical analysis practitioners would have been blown out of the market on the break of that low.

The crude oil has been advancing as expected. We’ve had these price curves based upon other historic bull markets on the order of what occurred on the crude oil. Implosions took place in all of these markets; sugar in 1974, silver in 1980, cotton in 1960, 1864, and corn in 1864.

The culmination point led to significant leg to the downside so we’re becoming very mature as far as this leg up in crude oil is concerned, plus there is a significant carrying charge premium on the distant contracts which is going to be playing very favorably into short positions if a sell signal is given.

We experienced a huge bear market in the stock market (the S&P 500), the second greatest since 1886. The overall decline into the March 6th low was 58%.

The Goldman Sachs index experienced the greatest bust cycle in commodity prices in history (our historic database of commodity prices goes back to the early 1800s). The overall commodity market declined 66% in five months and 15 days.

When you have this type of wealth destruction, this implosion, or deflationary decline in commodity and stock prices, obviously we see these two markets very much joined at the hip as investors and speculators, and those in the economy are basically faced with taking evasive maneuvers.What we knew from history is that when we experienced bust cycles on this order, for example, like 1920, 1932, 1948, 1974, the lows in both stocks and commodities coincide very closely to one another. The S&P 500 bottomed on March 6th, and the cash Goldman Sachs we bottomed on February 18th, so within about three-and-a-half weeks of one another this deflationary implosion, this panic, this capitulation of longs was occurring across the board both in commodities, tangible assets, natural resources, stock market, really, across the board. That carries through with real estate, commercial real estate and so on.

Stock Market and Commodity Culmination Lows In Place

The S&P 500 has experienced a meteoric rise of 39% in two months and two days, from January 6th to March 8th (a runaway advance to the upside).

The  Goldman Sachs index experienced some basing, but the overall advance off the February 18th low has been 39% so both of the stock market and overall commodities have advanced 39%.That is still a far cry from where we’ve come from in the markets, but I don’t have to tell you that a 39% advance in any market, historically, is a very significant advance.These advances place us in the very elite category of first legs up in projected overall bull markets.

Trade Action and Investment Possibilities if our Market Forecasts are Confirmed

In the S&P 500, we experienced a historic bear market on the basis of all our projections this was a final low; and this is a first leg up in a bull market (see charts in video). The seven closest historic precedents that we’ve been able to isolate, in other words, markets that experienced the type of decline on the order of what we’ve seen in the stock market, this advance very much rhymes with what one would expect once a final capitulation low is in place and a violent short covering a first leg up in a bull market takes place in the aftermath of that capitulation low.

We are very much following the personality of first legs up. We have seven historic precedents that fall into the category of our market, the bear market that preceded it, and first legs to the upside.

What we do is we show those seven precedents. You can see we have 1974, 1908, 1987, 1904, 1938, & 2003. What this does is show the corrections which took place after the first legs up in these bull markets. This shows the percentage retracements of the first leg up which took place.

“At the completion of these corrections historic bull markets were resumed. The implication is straightforward. Once a correction on the order of these corrections has been confirmed, we need to prepare ourselves for a potential all-out buying opportunity as both investors and speculators for a second leg up in an overall bull market. This is the lowest risk point for investors to take action.

One of the things that the legendary trader W.D. Gann said, is that once a final low is in place, and sometimes it’s difficult to project a final low or to get in at the low for a bear market, but what invariably takes place is you have a first leg up off a final low, and this confirms that a final low is in place. In other words, all the dynamics, the geometry of that advance, confirms that a low is in place.  Once that first leg is complete then you get a secondary correction. This would be the first correction in an overall bull market.

Keep in mind that we already have confirmation that a final low is in place, so this correction sets the stage for the lowest risk opportunity to actually enter long positions do so on weakness, which is always ideal – buy on weakness sell on strength – so buy on weakness in advance of what would be a second leg to the upside. If we can experience a correction in the S&P 500, and it’s certainly possible that correction could occur off the 930.17 high, no guarantees there but it certainly can, and if we see a correction on the order of what we have seen historically – and we’re going to be monitoring this – then the stage is being set for a major stock market buying opportunity for a protracted bull market.

I believe buying the corrections is the lowest risk place in a long positions with very significant upside. You can see on three occasions, 1974, 1987, & 2003, almost the entire first leg up was corrected during that first correction in a bull market with lesser corrections occurring during ’08, ’04, & ’38.

Technical Analysis of the Stock Market

In looking at the technical condition of this market, the shorter term view, we’ve experienced three minor corrections of 6.4%, 5.6%, and 5.6% during this runaway leg up. The first minor indication a projected swing high will be in place will begin on an overbalancing of these minor corrections. A decline to 858.78 will confirm this. If the S&P 500 declines to 858.78 we will have exceeded by 20% all of the minor corrections (6.4%, 5.6%, 5.6%), that would tell us that the selling is better than the buying for the first time since March 6th, and that’s a minor indication that the correction can be more complex.

We are very close to possibly seeing  a breakdown beneath the recent minor lows 878.94 and we closed in the cash about about 885 on Friday. So if we break this 878.94 and continue lower, then this is going to be starting to define itself as “correction.”

Keep in mind that this is a projection that we have. If we do see a severe correction, obviously the bears will come out of the woodwork again; the news will turn very negative, the forthcoming news talking about how terrible the economy is and everything, that’s what we want to see happen because it’s going to coincide. Bad news invariably coincides with this corrective low, this projected corrective low.

Once these lows were in place what did the second legs up look like?

We are apprising subscribers with respect to what kind of opportunity are we looking at. If it’s a long term bull market then the probabilities are very high that it’s not going to be just a second leg up but there will be another correction and then another leg up.We really are looking at this through the lens of anticipating an unfolding of a long term bull market.

Commodities Markets History and Analysis

In looking at the Goldman Sachs index things get very interesting as well. Keep in mind that these markets (the stock market and commodities) have been moving in tandem. The expectation is that they are going to continue to do so, so they’re playing to the same beat essentially.

I guess you could equate somewhat in the short term this government stimulus  to crack cocaine in getting a temporary high which is what is taking place, I believe, in the markets, but then we are going to see a retracement.

Ideally we are going to see a retracement, historically that goes without even being said. That is just a historic fact. It’s on that correction that we would look to be being a buyer in both the stock market and the commodity market.

Commodity Market Observations: Goldman Sachs

Following the March 6th low in the stock market, stocks have advanced as much as 39%, and overall commodities 28%. That’s off of the March 6th low.The stock market bottomed at this point in time, commodities had all ready bottomed some weeks prior, so you can see that the advancing of commodities and stocks have basically gone hand-in-hand.

We have projected these markets continuing to trade in tandem with one another. Once the current leg up is in place in the stock market, and a sharp correction takes place, the probabilities would likely favor a sell-off in overall commodities as well.

In other words, if these markets remain joined at the hip we could be provided with ideal opportunities to enter long positions in both stock and commodities if the corrections coincide with one another. Obviously we would be selective in which commodities we would purchase.

Questions We Are Asking of Commodities Markets History and Stock Market History

So we are faced with, right now, answering the questions from history.

• Once the first legs up were complete in 1920, in 1948, in 1932, other deflations, 1974, what did the corrections look like prior to the next legs up?
• Then, what did the second legs up in the overall bull markets look like?

The way we’re viewing this in the commodities is that we have a range of commodities. Some of the commodities are going to be the leaders, and some of them are going to be the lagers. The challenge that I have as a publisher is to recommend and apprise subscribers and provide rationale for which commodities are going to lead and which ones are going to lag.That is homework that we are doing right now for subscribers in anticipation of the likelihood that we will see a correction in a point in time here, and it could be imminent as far as what is taking place in the stock market.

If the stock market experiences a correction here, it’s very possible and likely that commodities would also experience some deflation as well since they’ve been moving together.

Once those corrections are complete, that’s where we would be loading the torpedoes for what is the perfect place to enter long positions, historically, in speculative investment markets?

Commodity Trading for Subscribers

The last chart that I want to show you is the soybean cash (see video). The soybean complex has been one of the complexes that we have rejected as a leader during these legs up.

In the case of the soybeans we put our lows in December, rallied into January, and put a higher bottom in March. The final low in overall commodities was February 18th, so soybeans actually bottomed before the index did so this was a bullish indication for soybeans saying that it was in a stronger position and should lead during the current leg up, and it has.

We have a very well defined target zone in the soybeans based upon the 1974, ’77, ’49, and ’76 highs. We continue to progress along these angles of ascent into what would be projected highs.

The 1974 top occurred on May 28th, and we are coming up on that this week; the first of our cycles to top out. The subsequent cycles with 1976 topping out on June 26th and that is the last of them. We are pushing up towards our target area in the soybeans.Once these highs were in place, dramatic sell-offs took place. This will likely very much coincide with a deflationary move in overall commodities based upon the likelihood that the stock market would be declining as well.

That sell-off in the soybeans and the soybean complex could provide an ideal opportunity to get short, and while it would be a countertrend trade being the the soybeans are in a bull market right now, it would set the stage for a likely very severe correction in the soybeans. If you’ve been listening to recent videos you know that we’ve been long the soybean complex so we are going to be looking to take profits. We are down the road on this leg up and we are monitoring it very closely. The other side of the mountain will be a leg down and then from there a subsequent leg to the upside in the soybeans.

All of these projections we’re going to be providing to subscribers. The soybeans have been nothing short of remarkable with respect to how closely we have followed the key historic precedents ever since experiencing this historic decline. We hope we’ve given you some insight on what is to take place with regard to the overall investment environment.

We covet the opportunity to have you as subscribers during what should be a tremendous wealth-building opportunity if we experience corrections.

You can watch this video and gauge it, but I can tell you this, if corrections occur in the stock market and overall commodities, if that is something that starts to unfold over the next month to month-and-a-half, a correction, then be assured that we’re going to be on point over here in terms of projecting the completion of those corrections in anticipation of those very significant wealth-building moves to the upside.

* Please comment on the video at the bottom of the page *

The most strategic point at which to make long-term investment and speculative purchases in Stocks and Commodities. From the time the economic bust began in July 2008, the Stock Market and overall Commodity and natural resource prices have been moving in tandem.

In the aftermath of the 2nd greatest decline in our 210-year financial history in the Stock Market (-58%) and greatest decline in history in Commodities (-66%), bottoms were established in both investment classes within 16 days of one another on March 6th and February 28th. Since then as measured by the both stock market and commodity indices, advances of 39% have taken place off the final lows.

In this video, we start setting the stage for what we know from history has been the most strategic point at which to make long-term investment and speculative purchases. If you have been listening and following our analysis and projections over the past year, you know what has taken place has been no mystery to us. I am confident the next projections we are to provide our subscribers have a high probability of coming to pass.