Soybeans Tech Update

It was another session of short covering for beans today as the market evens up heading into tomorrow’s USDA crop report. With the widely expected lower carryout figures from the government, short positions took advantage of early weakness to cover. Trends remains lower, but the reversal yesterday and follow through today indicates the market will chop until the figures tomorrow.

November bean futures put in a nice outside day higher yesterday. This was followed up with a strong showing today as prices closed above the 100-day moving average for the first time in six sessions. The chart appears to be working on a head and shoulders formation which makes the 920 area an intriguing one to keep an eye on. Add in the 200-day moving average at 924, and there’s a pretty clear line in the sand.

The bean market has turned sideways, captured by its major moving averages. Momentum is coming out of oversold territory which is helping the recovery effort. Follow through strength tomorrow would cement a momentum shift from negative to at least sideways. With a potential head and shoulder top forming, keep an eye on the 920-925 area as key resistance.