April 27, 2007

 

CBOT Soy Outlook on Friday: Steady-firm to start; eyeing corn

 

 

Chicago Board of Trade soybean futures are called to open steady to slightly higher at the opening Friday, following slightly higher electronic overnight trading.

 

In e-CBOT trade, July soybeans were up 1/4 cent at US$7.35 1/4, while new-crop November soybeans were up a penny at US$7.63 1/4.

 

It is still all about the weather in the Corn Belt for soybean - and corn - traders. Latest weather forecasts are calling for lingering showers through the southern and eastern Corn Belt into the weekend. But conditions are expected to be warmer and mostly dry across the Corn Belt next week.

 

The National Weather Service 6- to 10-day forecast for May 2-6 calls for above-normal precip across the Corn Belt and Plains, while above-normal temperatures are expected across the eastern two-thirds of the country.

 

"Flip-flopping forecasts will keep the market jittery and price action volatile," according to the Pro Farmer market advisory service.

 

Soy complex traders will keep a close eye on the corn futures market for direction. Corn has been a recent leader on price moves. Any significant strength or weakness in corn is likely to spill over into the soy complex futures.

 

There was no fresh U.S. export demand news reported overnight.

 

Technically, it will take a higher close Friday to bolster ideas that a market low might be in place. But right now a two-month-old downtrend line is still in place on the daily bar chart. Soybean bulls would regain some upside technical momentum by producing a close above solid chart resistance at US$7.50.

 

The next downside price objective for the bears is closing prices below solid support at US$7.22. First resistance for July soybeans is seen at Thursday's high of US$7.40 3/4 and then at 7.45. First support is seen at Thursday's low of US$7.33 and then at US$7.28.