May 2, 2007

 

CBOT Soy Outlook on Wednesday: Mixed, technicals, acres vs big supplies

 

 

Chicago Board of Trade soybean futures are seen starting Wednesday's day session on mixed footing, as supportive technicals and acreage uncertainties battle the weight of bearish supply side fundamentals, analysts said

 

In e-CBOT trade, May was 1/2-cent lower at US$7.40 3/4, July was 3/4-cent higher at US$7.57, and November soybeans were 1 1/2-cent higher at US$7.85.

 

CBOT soybean futures are called to start the session 1-cent lower to 1-cent higher.

 

Supportive technical closes Tuesday, with the most active July future settling above key technical support levels is expected to attract fresh speculative buying, with concerns that soybean plantings are running well behind average similar to corn an attractive feature to buyers as well, analysts said.

 

Bullish technicals are serving as a rallying point for futures, but abundant domestic and global supplies and good opportunities for rapid seedings this week in the eastern Midwest are expected to keep pressure on prices, analysts added.

 

A technical analyst said a two-month-old downtrend line is still in place on the daily bar chart. Soybean bulls would regain some better upside technical momentum by producing a close above solid chart resistance at US$7.70 basis the July future. The next downside price objective is closing prices below solid support at Tuesday's low of US$7.38 1/2.

 

First resistance for July soybeans is seen at Tuesday's high of US$7.58 1/4 and then at US$7.63. First support is seen at US$7.50 and then at US$7.45.

 

The DTN Meteorlogix Weather Service forecast said favorable planting weather outside of Missouri is in store for the western Midwest for a couple more days. Thunderstorms Friday-Saturday may cause slow downs over the west and north areas of the region. In the eastern Midwest, improving conditions for field work and planting this week, despite a few light showers in the area. The exception to this is in the south where it may be somewhat wetter for a time.

 

A total of 1,057 deliveries receipts recirculated against May soybean futures Wednesday. Large issuers included the house account of ADM Investor Services which issued 492 contracts. Stoppers were scattered with a customer account at Man Professional Clearing the primary stopper with 411 lots. The last trade assigned was May 1.

 

In overseas markets, Chinese soy futures markets are closed until May 8, in observance of the Labor Day holiday, and Malaysian Palm Oil futures markets are closed Wednesday in observance of national holidays.