Soy Beans give Buy, grain complex surges
Trading commodity futures and options involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge and financial resources.
Soybean futures saw its highest close today (8/29) since the beginning of the year and has been trending upwards since mid June. This gave me a buy signal on the daily charts with both the 9 and 20 day simple moving averages pointing up. I also received a sell signal for the US dollar on the dailys. A depleted dollar adds support to a soy bean rally.
Yesterday Corn similarly gave me a counter-trend buy signal on the daily charts. In addition Wheat gave me a buy yesterday as well, making it four buy signals since the 9 day SMA crossed the 20 day SMA to the upside in June.
US weather is considered mostly favorable for beans and grains overall but the continued drought in Russia is the main weather concern in all markets.
"Prospects for the next grains crop have been significantly affected by the past month's adverse conditions in parts of the Black Sea region, the [European Union] and Canada," according to the International Grains Council, an intergovernmental group that analyzes global supply and demand. The IGC also said it expects higher exports from the U.S due to increased demand.
Furthermore there is potential for supplies to tighten if governments in the Black Sea region impose limits on exports to protect domestic supplies. Restrictions on exports from the area in 2008 helped propel prices to records amid global crop failures.
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or email: LBaer@zaner.com
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Futures, options and forex trading is speculative in nature and involves substantial risk of loss. All known news and events have already been factored into the price of the underlying commodities discussed.
