November soybean futures are still in a nearly three-month-old price uptrend from the April low of $10.45 1/4. Prices last week hit a fresh contract high of $15.66 3/4. The soybean bulls still enjoy the solid overall technical advantage. However, a bearish technical signal has just been produced by the Moving Average Convergence Divergence (MACD) indicator overlaid on the daily bar chart for November soybeans. The MACD line of the indicator has just crossed below the “trigger” line of the indicator to produce a bearish line crossover signal.
The last time the MACD indicator was in a similar posture to the one at present and produced a bearish line crossover signal was in early March. Shortly thereafter November soybeans did decline from the March 4 high of $14.73 1/4 to the April 1 low of $10.45 1/4.
The two key technical support and resistance levels to monitor in November soybeans are the contract high of $15.66 3/4 and this week’s low of $14.73 3/4. A close above the contract high would provide the soybean bulls with fresh upside technical momentum to suggest a new leg up in prices in the near term. A close below last week’s low would provide the bears with fresh downside technical momentum to suggest a further leg down in prices in the near term.
“Seasonality” studies for soybean futures show that prices do tend to hit a peak in the June timeframe and then back off into the August timeframe before rallying into the September timeframe and then declining into the October timeframe.
Bearish Technical Signal for November Soybeans
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