April 1, 2009
CBOT soy recovers; bulls have more work
Chicago Board of Trade May soy futures were holding strong price gains at midday Tuesday (March 31) in the wake of a surprisingly bullish US Department of Agriculture planting intentions report.
May soy hit a session high of US$9.45 1/2 a bushel after prices Monday notched a fresh two-week low of US$8.97. Now, an uptrend line drawn from the early March lows and Monday's low is in place on the daily bar chart.
However, despite the solid price gains Tuesday, the soy market bulls have more heavy lifting to do in the near term to jump-start a solid price uptrend that would produce the kinds of gains which market bulls are seeking.
Even with Tuesday's rally in May soy, a fledgling downtrend line can still be drawn on the daily bar chart, from last week's high of US$9.81 1/4. Strong follow-through buying on Wednesday or Thursday would very likely negate that downtrend line and provide the bulls with fresh upside near-term technical momentum.
Overhead resistance for May soy is now located at Tuesday's high of US$9.45 1/2, at US$9.50, at US$9.62, US$9.70, US$9.75 and then at US$9.81 1/4.
On the downside, technical support for May soy is located at US$9.28 1/4, at US$9.25, at US$9.20, at US$9.10 and then at Tuesday's low of US$9.04 1/2.
