Soybean Tech Update
Grain Market Commentary
Wednesday, September 6, 2017
by Jacob Christy, Freedom Program Trader
A couple of nice sessions for the bean market to start the shortened week. Prices bounced Tuesday as China caught up on buying needs for October while finishing weather and disruptions from the U.S. hurricanes also lend support. Nov17 futures now sit near mid-range and await next week’s USDA report, as the debate between growing supply and growing demand looks to control the bean market again this year.
Nov17 beans managed to breach and close above the 100-day moving average Tuesday, as most of the remaining speculative shorts covered. The market moved above the 50-day moving average today but couldn’t garner enough momentum for a true test of the 200-day, but did finish on the 50-day. To the upside the combination of the 200-day moving average, Aug USDA report day high, and 50% retracement look to provide key resistance from 981-988. Breaking above 988 would confirm a new uptrend. To the downside, look for the recently breached moving averages to provide support. Falling back below 950 would be discouraging to new bulls.
Beans are correcting a deeply oversold condition the market slipped into Mid-August. The next few weeks could go a long way in determining if this is a correction or the start of a longer term trend. Keep an eye on the major moving averages as indicators for larger moves in each direction. The short term direction of beans will be largely determined by near term demand and the USDA report next Tuesday, but the technical, as always, we play the role in determining how dramatic the moves may be.