Market Bottom Watch: How Much Higher Can Soybean Prices Go From Here?

November soybean futures (ZSX25) present a buying opportunity on more price strength.

See on the daily bar chart for November soybean futures that prices have made a strong rebound from the late-June low, to suggest a near-term market bottom is in place. The bulls have the overall technical advantage and have momentum on their side. 

Fundamentally, better trader and investor risk appetite in the general marketplace the past two weeks has produced more speculative buying interest in the grain futures markets. Also, the majority of the U.S. soybean crop will be entering its most critical phase of the growing season in the coming weeks. Some extended weather forecasts are calling for hotter temperatures in parts of the Midwest, with July and August typically seeing less rainfall. And, more years than not, some degree of a weather market scare occurs in the soybean futures market in the summertime.

A move in November beans above chart resistance at $10.55 would give the bulls more power and it would also become a buying opportunity. The upside price objective would be $11.15, or above. Technical support, for which to place a protective sell stop just below, is located at $10.30.

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. 

On the date of publication, Jim Wyckoff did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.