Hi marketman,

I can't specifically address your formula..it would be outside of the realm of what I do.  However, I would be highly skeptical it would be that easy.   Although 1974 looks very similar to our current price structure. One of the most glaring is the fact that price couldn't retest the broken minor structure around 5.30, where it did in 1974.  These are important points...I will leave it at that for now.

Chief,

Glad you asked.  I got an email today from an lurker on NAT as well, asking similar questions so you aren't alone.  Your point was exactly what I was trying to get across without making absolute statements.  What we have been experiencing in this two year decline is nothing other than the release of stored energy from the rally to 8.50.  We have come from 8.49 to 3.33 high - low. Similar to the rally up,  there is energy stored that will need to be released with a combination of time and price.. Let's assume the lows were found last week.  Just the the energy stored within the last three pivots would give you a high probability of reaching 4.50 front month futures.   The futures market is already expressing this as noted by the commercial interests here mentioning the "carry" that exists in the market.  At its core, this is the stored energy that exists in the last three pivots being expressed into the summer months.  This energy needs to be expressed into those months because the front months will expire before the stored energy can be released.  The inverse of the current "carry" in corn was than last year's corn market and this year bean market, with the front months leading price.  $4.50 would be the daily chart's release of energy(the minor), and we would still have the big swing (major) which would get us to well over 6.  Again, these are the expression of information contained within the two pivots we have today, and the "make believe " third which is last weeks low.  I think the analogy you laid out is a good one, only since we are dealing with a major formation, it will likely be longer in duration.  I would need to spend a bit more time on it - especially after we finally confirm a pivot and get some market structure following it...but  I could see us finding a low, bouncing back and struggling to rally in 2015 - likely running to trouble seasonally in 15.  From there is where I think things may get complex.  I wouldn't be surprised at on a failed attempt at new lows as price will need to restore more energy for another attempt lower and ultimately price being higher in 2016 than 2015.  This is where I think its going to be crucial to be managing your risk with the COP above market values.  If a rally occurs back to say 4.50, producers will be aggressive sellers out of fear....and you can't blame them.   But like the summer rallies the last few years, if you didn't control product in some form, you just watched the rally, and had no way to participate.  The difference this time, is likely the price accepted by producers will be slightly above COP, and not near the margin that existed the previous years.   From there we make new lows in late in the decade.  From there, the stored energy from 8.50 corn hopefully has been exhausted, and we can make some headway back to higher prices.  I think it was Tara that coined the phrase that " bottoming is a process, not an event".  In this context, he is absolutely right.  The headwinds that are projected forward from the current market structure will be around for while!

Take Care