Soybeans Tech Update

A classic “buy the rumor, sell the fact” reaction from the bean market today following the ceremonial phase one deal signing. Prices had been on the rise since early December in anticipation of getting a signed deal. However, some air was let out once the 94-page document offered no real new information or enforcement details. Prices fell to multi-week lows but managed to hold initial chart-based support setting the stage for some momentum determining sessions ahead.

In the largest traded volume session of the year (beating the USDA report day by 4k contracts) March beans dropped 13c today, falling out of the recent consolidation range. Prices found support at the combination of the 50- and 100-day moving averages along with the initial Fibonacci retracement band all found near 927-928. A penny bounce off session lows puts prices precariously perched above key support to finish the week.

Moves like today are hard to categorize. Are we looking at a brief algo decompression, or is the market deciding on a new price paradigm? Answering this question will take time, but how prices react technically over the next few sessions could tip the markets hand. Stay tuned.