February 18, 2009
CBOT soy gain quick power
Chicago Board of Trade May soy futures on Tuesday (February 17) morning were under strong selling pressure on follow-through selling after Friday's technically bearish weekly low close.
May soy on Tuesday morning hit a fresh seven-week low.
Serious near-term technical damage has been inflicted in May soy recently. Prices have shed over US$1.00 a bushel from last week's high of US$10.24 a bushel.
Two popular shorter-term moving averages - the nine-day and 18-day - overlaid on the daily bar chart did produce a bearish crossover signal on Jan. 30, whereby the nine-day crossed below the 18-day moving average.
May soy futures prices are also in an accelerating five-week-old downtrend on the daily bar chart, from the Jan. 12 high of US$10.69 a bushel.
The next downside price objective for the rejuvenated soybean market bears is to push and close May futures prices below psychological support at US$9.00 a bushel. That would open the door to a quick move to solid technical support at the November 2008 low of US$8.54 3/4, or even more strong technical support at the contract low of US$7.86 1/2, scored in early December 2008.
For the soy bulls to begin to repair recent technical damage they would have to push and close May futures prices back above major psychological resistance at US$10.00 a bushel.
