What to watch for on today's SOYBEAN close
Jun 21, 2013
Soybean bulls are obviously concerned about increasing outside macro market pressure, in response, profit taking and liquidation was yesterday's theme. There is also some concern about the recent setbacks in both India and Brazil's currencies, as both are hitting new lows, making their exporters all the more attractive. Just look at yesterdays dismal USDA weekly soybean export sales number of 161,100 metric tons vs expectations of between 350,000 and 600,00 metric tons. China's dismal growth isn't helping matters either. As we know, high expectations have been placed on the growth of their middle class to keep soybean demand high, but if that growth doesn't end up happening at the rate the market has been anticipating, or "spending" really starts to dry up on liquidity issues, it could have a very negative effect on prices. Analysts have already been saying the USDA's estimate for Chinese soybean imports is way too high, the latest worries just give the bears more credence to their argument. Question is, to what degree and when is that expectation going to be reflected in our current price? Technicians are keeping a close eye on nearby support thought to be around the $12.80 area, which has been breached in the overnight session. I would advise doing the same. A close below this level on the week may prompt further long liquidation by the "tech" crowd. Trade continues to question USDA's next move in Friday's report: How far will they raise domestic crush numbers? Will they cut exports? Will they find more bushels, saying they underestimated last years crop, and by how much? For an inside look at what is driving the grain prices,CLICK HERE, for my full report.