Key Points:
This is a follow up article to: Soybeans and corn hit lows with bumper in U.S. harvests
Soybean (Symbol: Soybean-C) prices saw a slight decline, trading at $9.87 a bushel and marking the first drop in four sessions.
Picture: Soybeans ease from two-week high, as observed on the VT Markets app.
Looking at the charts, we see that soybean futures have recently pulled back slightly, closing at 9.872, marking a 0.55% decline after reaching a two-week high in the previous session.
This earlier surge was driven by market concerns about the hot and dry weather conditions in the U.S. Midwest, a key growing region, which threatened to impact the expected record soybean crop. However, the recent moderation in these weather extremes has provided some relief, easing the upward pressure on prices.
The chart shows that after peaking at 9.973, the price began to consolidate, with the price currently trading around key support levels near the 24, 24, and 72-period EMAs. The MACD indicator reflects this consolidation, with the MACD line crossing below the signal line and the histogram turning negative, signaling a potential slowdown in bullish momentum.
As the market awaits further weather updates, traders should monitor the support level at 9.870 closely, as a break below this level could signal further declines. On the upside, resistance around 9.973 could limit any recovery attempts, with the potential for further gains if the weather forecast worsens again or if new concerns about the crop’s health emerge.
The moderation of extreme heat later this week will be key in determining the direction of soybean prices in the short term.
Corn and wheat also saw minor losses after posting gains as abundant global supplies continued to weigh heavily on these markets. Corn prices dropped to $3.91-1/2 a bushel, and wheat slipped 0.3% to $5.33-3/4 a bushel.
The weather conditions in the U.S. Midwest will continue to be a critical factor in the coming days. Any significant deviation from the forecasted moderation in temperatures could lead to renewed buying interest in soybeans, potentially pushing prices higher.
On the other hand, the ample global supply of corn and wheat is likely to keep these markets under pressure. Traders should keep a close eye on crop progress reports and global export data, which could offer further insights into potential price movements.
Learn how to trade soft commodities based on supply and demand.
Given the current environment, traders may find opportunities in short-term positions, particularly in soybeans, where weather-driven volatility could create quick trading windows.
