Short- and long-term cycles in grains and livestock are timing mechanisms that AgriVisor Sr. Market Analyst Dale Durchholz has studied for years. He argues cycles should be counted from price low to price low, rather than high-to-high.
That’s one reason he thinks recent upside price action in corn futures is “not a headfake. The cycle low was due a couple weeks ago, but we’re still in the window when a low should be expected.”
Durchholz told AgriTalk After the Bell host Chip Flory, “And now it’s lining up better with the short-term cycle low in soybeans… these cycles tend to do that over time. Beans have a cycle low due in early August, but we’re just getting into the window when beans can post a cycle low, so the timing is good. It looks like the recovery is started.”
However, he warned that just because a cycle low has been posted it does not mean prices will go higher… it just means further price weakness is unlikely.
“It tells me you don’t want to be on the short side of the market any longer,” said Durchholz.