Very high yield reports continue to clash with strong demand which has kept the market range bound and this has frustrated bulls and bears alike. November soybeans put in its weekly range on Monday’s rally of 946 to 975. Many are confused as to why such impressive yield reports have not pressed the market to new lows. The last two years, soybean ending stocks were over 400 million bushels on January 1st and each year were chipped away to below 200 million bushels. Whether it is Brazilian logistics or Argentine floods, something always happens in South America that bails out the U.S. farmer. Conab believes soybean productions in Brazil will reach 101-104 million tonnes this year from 95.4 million last year. The USDA is at 101 million tonnes. What if this year, something happens and Brazil produces 110 million tonnes? For the USDA report, a Reuter’s survey showed traders expecting soybean yield near 51.5 bushels/acre as compared with 50.6 million projected in September. Ending stocks are expected near 413 million bushels as compared with 365 million bushels by the USDA last month.
The market tested the weekly low and bounced yesterday but a close below 9492 today will not look good on the charts. The market also settled below the shorter term 21-day moving average at 9624. Keep 917 and 915 as next downside targets.
Series 3 Licensed
Market Strategist II
Tony majored in Economics at Eastern Illinois University. He performed his thesis on the market price of corn in the market and the factors that affect it. Tony was drawn to futures trading because of the opportunity to have financial gains in an economic environment. He prides himself on working with customers one-on-one and developing a trading strategy based on the client's needs and wants.