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Yesterday’s Close: May soybean futures finished yesterday’s session down 11 ¾ cents, trading in a range of 15 ¼ cents. Funds were estimated sellers of 8,000 contracts on the day.
Fundamentals: The lack of good news weighed heavy on the market as participants come to grips with the idea that a trade deal isn’t just going to happen overnight (shocking right?). The bull camp is hoping tomorrow’s USDA report could be enough to spark a round of buying. The range of estimates for U.S. carryout is from 860-940mmt, the average being 902. Estimates for world carryout range from 104.40-113.57, the average being 106.33mmt. The averages for both of these would be slightly under what we saw in the February report. Export sales this morning came in at 311,000 metric tons, below the range of expectations.
Technicals: The chart has softened up a lot over the last month, posting lower highs and lower lows. The silver lining for the bull camp is that our 3-star support pocket held well. We have defined that as 900-904 ¾ is the must hold pocket. This pocket represents the lows on the year (Jan 16th), they psychologically significant 900 handle, and the middle of the range from the contract lows to the highs in December. As mentioned in previous reports, this is a MUST hold pocket. A break and close below could open the flood gates. As far as resistance goes, the first pocket we see comes in from 909-913 ½. We want to be optimistic on prices, but the chart doesn’t resemble anything bullish, so our bias remains neutral.
Resistance: 909-913 ½**, 922 ¼-924 ¾***
Support: 900-904 ¾***, 893 ½****
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