By Alan Kluis
I began charting and trading commodities in 1974. I was fortunate that I had two great mentors:
Jim Gill who was with Agri Visor in
Bloomington, Illinois, and Ken Poole a retired executive from Cargill.
Gill was a great communicator
and a patient, long-term thinker. He
taught me common-sense concepts
such as incremental scale-up selling,
seasonal selling, and how bullish
news comes out at the top of the
market and bearish news comes out
at the bottom. When July corn futures fell below the short term uptrend line at $7.75, the market
Poole was a technical trader who appears to have topped out. Shortly after, corn futures confirmed a major high.
was trading for a living when I met
him. He was impatient, gruff, and
demanding. You had to keep hand- and motion. This article will explain project markets to move up or down
drawn daily charts on all of the the charting concepts that I use in in an equal time period.
different commodities and the CRB making marketing decisions. The third time study is the study
each day. I have kept those charts of monthly seasonal price patterns. I
up for 34 years. I was one of three the study of time use five-year monthly seasonal price
students to start with; within a year I There are many ways that you patterns and have a summary of the
was the only one left. can apply time studies to analyze monthly expectation in the Kluis
It took me over six years to under- commodity price trends. Commodity Calendar. I do these
stand some of the complex concepts One study of time is that of price studies in an attempt to figure out
such as day counts and using Gann cycles. This can be very rewarding the key time periods when prices are
numbers. when your analysis helps you find a likely to put in a high – or a low.
Poole knew how to make money high or a low. Grain prices went a lot higher
trading, but his teaching methods One difficulty using time analysis that I anticipated into the June-July
were very unconventional. He did is that you have a large number of time period of 2008. Producers who
not have a lesson plan other than to different cycles that impact all of the stayed with a disciplined seasonal
trade. He said your monthly profit agricultural commodities. Another marketing plan and made sales in the
and loss is the ultimate score card. challenge is that the short-term time late-May to early-July time period
I had a real challenge trying to cycles will change after a major high had great results.
explain these technical analysis con- or low. The key seasonal time period that
cepts until I broke them into three The second way that I use time is I can project for a possible major
different categories. The three cat- to count weeks and days. You can low on the weekly corn and soybean
egories are the study of time, price, charts is the first week of November
References:
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