Monday, January 7, 2008

Soybean bearish divergence


Here is the bearish divergence that I mentioned in my last post. I have drawn a burgundy line in the subgraph that shows where it is located. I have also put a red arrow below the divergence. Any divergence on the daily chart should be considered significant.

At this point, with soybean prices still strong, and remaining well above the Exponential Moving Average, I am looking at this phenomena as a potential opportunity to buy when prices resume an upward path. However, I will take careful mental note of the possibility of a reversal, albeit a remote one.