Price action: January soybeans rose 7 1/2 cents to $11.15 1/4, near the daily high and hit a 13-month high. For the week, January beans rose 55 cents. December soybean meal rose $6.00 to $321.60, nearer the daily high and hit a nearly nine-month high. On the week, December meal gained $23.40. December bean oil fell 97 points to 48.68 cents, nearer the session low, hit a 4.5-month low and for the week down 159 points.
5-day outlook: The technically bullish weekly and monthly high closes in soybean and meal futures markets today has the chart-based bulls more fired up to continue to be buyers early next week. Technicals remain fully bullish for beans and meal, but the Relative Strength Index is flashing very overbought conditions in both markets at present. Don’t be surprised to see some corrective selling pressure at some point next week. Spreaders continue to buy meal and sell bean oil futures.
World Weather Inc. today said rain expected in Brazil this weekend and next week should be sufficient and widespread enough to improve crop development in areas that have not seen much moisture recently. However, there is some concern over subsoil moisture remaining low and follow up rain will be very important. Argentina has been seeing and will continue to see a good mix of rain and sunshine to maintain a very good outlook for summer crop planting and early development during the next two weeks, although some drying is likely in the east.
30-day outlook: There is some doubt among traders about China fulfilling its commitment of purchasing 12 million tons of soybeans this year and 25 million next year. “Whether China secures 25 MMTs in future years depends on the price relationships between South America and the U.S. China buys what China needs at the cheapest price offered—its’ that simple,” said one veteran market analyst in a note and as quoted by Dow Jones Newswires.
The U.S. soybean harvest is in its final stages, which means waning commercial hedge selling pressure in futures.
90-day outlook: Export demand for U.S. soybeans, hopefully fresh economic data from USDA in the coming weeks, or sooner as the U.S. government reopens, and weather in Brazil and Argentina as their growing seasons are under way, will be main fundamental topics for soybean traders in the next few months. Traders are expecting a large Brazilian soybean crop to go in the ground this year.
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