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Morning Futures Roundup


U.S. Poised to Produce Record Soybean Crop
 Fundamentals

Never underestimate the U.S. Soybean producer, as despite a wet spring delaying Soybean plantings, the U.S. is expected to produce a record Soybean crop this year.  Current estimates from traders and analysts are that 3.25 billion bushels of Soybeans will be produced, up moderately from the 3.199 billion crop estimate the USDA reported in the August crop report. 

Soybean yields are expected to have increased as well, with the trade looking for an average yield of 42.5 bushels per acre, up nearly 1 bushel per acre from the August report.  The only thing that may possibly prevent this year’s Soybean crop from being one for the record books would be an early frost/freeze.  However, weather forecasters are calling for average to above average temperatures in the Midwest the next 7 to 10 days, which should help the crop as it moves to maturity.  

A record crop would help to alleviate tight old-crop ending stocks seen this year, as soaring Chinese demand for Soybeans has kept U.S. exports strong despite relatively high cash prices.  We will learn what the USDA thinks about this year’s Soybean crop when the September Crop Production and Supply/Demand report is released this morning at 7:30 a.m. Chicago time.




Technical Notes

Looking at the daily chart for November Soybeans, we notice prices continue to hover below both the 20 and 100-day moving averages.  This would be considered a bearish signal by most technicians, however the market has moved into a strong support area around the 900.00 bushel area.  This may be the start of a period of price consolidation until the harvest gets under way.  The 14-day RSI is weak, with a current reading of 40.62.  Major support is found at the recent lows just above the 880.00 area, with resistance found at the 20-day moving average, currently near the 966.00 area.

CLICK HERE FOR THE FULL-SIZED CHART


Disclaimers
This article is provided for informational purposes only. No statement in this article should be construed as a recommendation to buy or sell a security or to provide investment advice. The content provided has been obtained from sources deemed reliable but is not guaranteed as to accuracy and completeness. optionsXpress makes every effort to provide timely information to its recipients but cannot guarantee specific delivery times due to factors beyond our control.

Futures involve substantial risk and are not appropriate for all investors. Please read the "Disclosure Statement for Futures and Options" prior to investing in futures or options.

For investments using a straddle or strangle options strategy the potential loss is unlimited. Multi-leg option strategies are subject to multiple commissions. Profits may be eroded by the commission expended to open and close the positions and other risks apply.



Posted by Mike Zarembski | View more articles by Mike Zarembski

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