Soybean futures flirt with the 200-day moving average

I am Stephen Davis, senior market strategist at Walsh Trading, Inc., Chicago, Illinois. You can reach me at 312-878-2391.

In last week's post, I mentioned that China's economy is growing. Its Gross Domestic Product (GDP) will hit the target of 5%, said Chinese President Xi Jinping in his 2026 New Year message. This growth could mean China's demand for commodities, and especially soybeans, could increase dramatically, in my opinion. China has fulfilled its initial commitment to buy 12 million metric tons of soybeans from the United States. However, fluctuating Trump administration trade policies could affect China's commitment to purchase 25 million metric tons of American soybeans in each of the next three years. 

Meanwhile, the soybean harvest is beginning in Brazil, which means an increasing amount of soybeans will be on the market. Analysts reports indicate that due to record production and competitive prices, China is expected to increase imports of Brazilian soybeans in the first half of 2026.

Below is a daily chart that shows today's March 2026 soybean futures prices flirting with the 200-day moving average. Back in October, soybean futures started a rally at 1050 reaching 1172-4 on November 18. Some would say this is a contrarian view, but, in my opinion, being bullish on soybeans at this time of year is a good thing.

A futures trade strategy is to buy March 2026 soybean at 1059.6, which was yesterday's low. Risk the trade 1047.0 stop. Profit objective is 1079.6. That's a good risk/reward ratio, in my opinion.

An options strategy is to sell three March 2026 soybean 1050 puts at 6.0. With that premium, buy one May 2026 soybean 11.00 at 17.3 (today's settlement price). The puts you sell will pay for the call you buy. The March 2026 soybean expiration is February 20, 2026. 

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To discuss trading strategies, contact me anytime. Have an excellent day. 

Stephen Davis
Senior Market Strategist 
Walsh Trading

Direct 312 878 2391 
Toll Free 800 556 9411
sdavis@walshtrading.com  
www.walshtrading.com

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