Soybeans Tech Update

Grain Market Commentary

Wednesday, August 7, 2019

by Jacob Christy, Freedom Program Trader, The Andersons

Another mixed session for beans as prices consolidate above their 10-week lows. Trade has turned quiet as the major USDA crop report looms. Beans have been on a decisive three-week slide since the breakdown in U.S.-China trade talks. But with so much at stake in Monday’s crop report, it’s hard to see the market going anywhere but sideways.

Like corn, soybean prices completed a distinct head-and-should top late last month. Confirming the top opened the door for a new round of liquidation that pushed prices to their lowest levels since May. November futures were able to fill a long-standing open chart gap on Monday but have since uncovered some bargain buying.

With the selloff to start August, soybeans have given up 61% of their spring rally. Prices sit at a precarious spot with little chart support until you get to contract lows near 815. That said, there is also little chart resistance until the moving averages back at 900. Beans have space to move.  

Obviously, the August crop report will dictate price direction. With so much riding on the report, and with nothing in the charts, the price move could be dramatic. Until then, expect prices to remain choppy and quiet.

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