(Commodities Weekly) Is This the Next Big Opportunity for Commodity Traders? 📈

There's so much happening in the commodities markets right now. 

Orange Juice futures just ripped 50% in several days and triggered our buy signal.

Crude Oil futures have resolved a textbook multi-year distribution pattern and triggered our sell signal.

To name a few...

We're also on the cusp of getting a fresh buy signal in Soybean Oil futures.

"Big Oil" wants more renewable diesel - from 3.3 to over 5 billion gallons.

If that's the case, demand will skyrocket for grains across the board.

Soybean Oil futures started 2025 with a BANG 🧨

The first week of 2025 was the largest 1-week rate of change since 1983 for Soybean Oil futures.

We love to call the beginning of each year "whipsaw hunting season."

This is where trends that are overextended, in either direction, tend to see dramatic mean reversion.

That's precisely what happened here...

Price was in a greater than 50% drawdown, and it was due for a bounce.

But we didn't know if the move had legs. We needed to see how the buyers reacted when faced with selling pressure.

And sure enough, they were up to the challenge. The bulls made a series of higher highs and higher lows. This established a brand new uptrend, which we think is about to accelerate to the upside.

Here's how we're trading Soybean Oil futures 👇

As you can see, the price has been resistant to the 38.2% retracement of the prior drawdown on numerous occasions.

If and when the price breaks out, we want to be long.

It's rare to find such a well-defined level of interest, and we plan on taking full advantage of that to limit our risk without sacrificing the potential returns.

We want to buy Soybean Oil futures on strength above 48.25, with a target of 55 over the coming 1-3 months. 

Over longer timeframes, we're looking at a secondary objective of the peak from July 2023, around 65.50.

Are you with us? Let us know what you think.

Commodities Trade of the Week

This week, we're outlining one of the "seven sisters" from the Standard Oil breakup from 1911, Chevron $CVX.

It's one of the largest energy companies in the world with operations in over 180 countries and 44,000 employees.

They have all kinds of businesses, from drilling for Crude Oil in Kazakhstan to refining in Mississippi and carbon capture in Australia.

The price has carved out a textbook distribution pattern (much like Crude Oil futures), and we're looking to get short if and when the price confirms our bearish bias.

Here's how we're trading CVX 👇