July soybeans rallied 26 1/2 cents closing at $15.21, near the session high. July meal futures rose $3.9 to $414.6, a mid-range close. July soyoil climbed 157 points to settle at 59.51 cents.
Fundamental analysis: Soybean futures saw gains today, especially in old crop futures as bulls reversed losses from late last week. Weather continues to drive the market as much of rain over the weekend was limited to the northern portion of the Corn Belt. Rain is still forecast late this week and into Sunday across the Midwest but is expected to be erratic while temperatures are above normal and continue to cause net drying, World Weather Inc says. Drought and dryness are expected to continue over the next ten days despite temporary relief.
This afternoon’s Crop Progress report will give insight into how much rain across the northern Corn Belt improved soybean crops. Conditions are expected to continue to fall, with analysts expecting a 3-point fall to 51% good to excellent, according to a Reuter’s poll. USDA released soybean inspections this morning which totaled 141,158 MT, down from 179,548 MT last week and 185,184 MT last year. Inspections continue to wind down as the crop year is coming to an end, although a more rapid pace is needed to hit the USDA export forecast for the 2022-23 crop year.
Technical analysis: July soybeans futures led the complex higher and made a new for-the-move high today. Price seemingly broke out of a bull-flag technical pattern which would indicate continued strength in the coming days. Bulls are still in full control of the technical advantage, targeting $15.35 which capped all the upside from December to February before prices turned lower. A break of this level would be very significant for bulls, with $15.50 next on deck. Bears are targeting last week’s low at $14.68 1/2, backed by 10-day moving average support at $14.64 1/4. Additional weakness would target the $14.50 level.
July meal had a relatively tame session compared to last week. Price struggled to rally above the 40-day moving average at $415.50, which stands as first resistance. Additional resistance comes in at the 200-day moving average at $424.04, backed by last week’s high of $441.20. Bears are looking to take out support at $410.40, backed by $407.00 support.
July soyoil has retraced nearly all the losses from the surprisingly weak EPA announcement last week. Bulls have returned to the “point of the crime” and will face resistance at 60 cents next, which coincides with last week’s high. Additional strength will be met with resistance at 62.75 cents. If bears defend nearby resistance, support can be found at the 200-day moving average at 57.41 cents, backed by 55 cents. The recent volatility in soyoil markets is likely to continue until a close above 60 cents or below last week’s low at 53.13 cents occurs.
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