May 4, 2007

 

CBOT Soy Outlook on Friday: Down 1-2 cents, following overnight theme

 

 

Chicago Board of Trade soybean futures are seen starting Friday's day session on the defensive, taking its cue from overnight trade, as traders take cautious approach to the market heading into the weekend.

 

In e-CBOT trade, May was 1 3/4-cent lower at US$7.32, July was 1-cent lower at US$7.46 3/4, and November soybeans were 3/4-cent lower at US$7.76.

 

CBOT soybean futures are called to start the session 1 to 2 cents lower.

 

The market is seemingly treading water, with the uncertainty of plantings and potential acreage keeping a mixed tone in the market, analysts said.

 

Futures are poised for sideways action, with positioning ahead of the weekend a feature, as the market battles support from talk of seeding delays and pressure from talk of potential corn acreage shifts to soybeans, analysts said.

 

Meanwhile, bearish domestic and global inventories remain defensive influences on nearby contracts to thwart near term bullish enthusiasm, a CBOT floor trader added.

 

A technical analyst said a two-month-old downtrend line is still in place on the daily bar chart. Soybean bulls would regain fresh upside technical momentum by producing a close in July futures above solid chart resistance at Thursday's high of US$7.58 1/2. The next downside price objective is closing prices below solid support at US$7.38 1/2.

 

First resistance for July soybeans is seen at US$7.50 and then at US$7.55. First support is seen at US$7.42 and then at US$7.38 1/2.

 

The DTN Meteorlogix Weather Service forecast said showers in the western Midwest Friday will be mostly light, leading to minor slow downs to planting. Thunderstorms for the weekend could be heavier but mostly for the western part of this region. In the eastern Midwest, any shower activity Friday is expected to be light, leading to minor slow downs in planting activities. Drier and warmer weather during the weekend and early next week will aide planting activities and field work, Meteorlogix reports.

 

A total of 1,107 deliveries receipts recirculated against May soybean futures Friday. Large issuers included a customer account of Man Professional Clearing which issued 476 contracts. Stoppers were scattered with a customer account at Man Professional Clearing the primary stopper with 515 lots. The last trade assigned was May 3.

 

In overseas markets, crude palm oil futures on the Bursa Malaysia Derivatives ended mostly lower Friday on profit-taking after the benchmark contract set a 2007 record high Thursday. The benchmark July contract settled MYR11 lower at MYR2,288 a metric tonne.

 

Chinese soy futures markets are closed until May 8, in observance of the Labor Day holiday.