Soybean Prices Have Likely Hit a Floor. Wait for These Levels and Then Buy.

August soybean (ZSQ26) futures present a buying opportunity on fresh price strength.

See on the daily bar chart for August soybean futures that prices have dropped down into the lower boundary of a choppy trading range. It’s my bias that technical support at the bottom of the trading range will hold and that bean prices will rebound at some point sooner rather than later.

Fundamentally, the global supply and demand balance sheet for soybeans is not bearish. Global food inflation is on the rise and China has promised the U.S. it will make additional purchases of U.S. soybeans. Also, many more years than not, some degree of a weather-market rally occurs in soybean futures in the summertime. A weather-market rally in soybeans is overdue.

A move in August soybean futures prices above chart resistance at $11.80 would become a buying opportunity. The upside price objective would be $12.60 or above. Technical support, for which to place a protective sell stop below, is located at the bottom of the trading range, at $11.48 3/4. 

IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any trades and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.

Here is what the Commodity Futures Trading Commission (CFTC) has said about futures trading (and I agree 100%): 

Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.