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Soymeal Turns Down From Major Resistance -- Technical Analysis

10 Oct 2017 12:00 pm
   By Kira Brecht 

November soybeans erased intraday gains on Monday to close lower. Two-way trade emerged at the start of the week after last week's gains. The short-term trend bias remains bullish, but November beans are testing key 20-day moving average support. Bean bulls need to defend that zone against further weakness, or the short-term trend bias will turn down.

Since marking out strong resistance at $9.87, the Sept. 22 high, November beans have consolidated in a correction phase. Key support lies at $9.52 1/2, the Oct. 3 low. For now, the uptrend seen off the Aug. 16 low at $9.21 remains positive. But, a decline under the 20-day moving average this week would open the door for slippage back toward $9.52 1/2.
 $11.50 1/2 -- the contract high 
 $9.63 1/2  -- the 10-day moving average 
 $9.66 1/4  -- the 20-day moving average 
 $9.55 1/2  -- the 40-day moving average 
 $9.75 3/4  -- the 200-day moving average 
 $8.57      -- the contract low 

December soybean meal slid to a weaker close on Monday. The near-term trend remains bullish. But, two-way trade emerged on Monday ahead of a key daily chart ceiling at $320.90, the Sept. 22 high. The trend off the Aug. 23 low at $295.10 is bullish. But, in the very short-term soymeal is vulnerable to consolidation and correction between resistance at $320.90 and support at $309.80-$309.70.

The burden lies on soymeal bulls to support a sustained upside breakout above the Sept. 22 high would open the door to a new buying wave. Beyond there, the next bullish chart objective lies at $326.50, the July 31 daily high. On the downside, the 10-day moving average is first support and as long as that holds, soymeal bulls will retain the short-term technical edge. If that floor cracks, the market will become vulnerable to slippage toward support at $309.70.
 $384.10 -- the contract high 
 $314.30 -- the 10-day moving average 
 $312.60 -- the 20-day moving average 
 $306.90 -- the 40-day moving average 
 $317.50 -- the 200-day moving average 
 $270.00 -- the contract low 

December CBOT soybean oil pressed higher Monday, closing above its 10-day moving average. The short-term trend is neutral-bullish in a correction phase. The trend off the Sept. 7 peak is negative. Recent strength has been corrective in nature. On the upside, resistance lies at 33.45 cents, the Oct. 5 high and a sustained gains above that ceiling would be needed to open the door to further strength. On the downside, support lies at 32.76 cents and then major support lies at 32.30 cents.
 43.07 -- the contract high 
 33.00 -- the 10-day moving average 
 33.85 -- the 20-day moving average 
 34.24 -- the 40-day moving average 
 33.75 -- the 200-day moving average 
 28.17 -- the contract low 

Write to Kira Brecht at copydesk@dowjones.com

(END) Dow Jones Newswires

October 10, 2017 08:00 ET (12:00 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.
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