Soybean Trade Technical Analysis - Soybean Trade Trading: 2015-08-05

US Department of Agriculture to report August, 12

Let us consider the continuous soy bean CFD or SOYB. Market participants are concerned that August, 12 US Department of Agriculture (USDA) will cut soy bean planting acreage and reserves forecast for the end of the season 2015/2016. In July the administration expected the crops to reach 3885bln bushels with the yielding capacity making 46 bushels per acre. The INTL FCStone private company released a report saying that due to bad weather conditions the crops may decrease to 3797bln bushels, while yield capacity may fall to 45 bushels per acre. According to the Informa Economics agency, soy production will total 3789bln bushels. Let us wait for the official data by USDA. We do not rule out soy bean quotes growth. Besides, farmers also anticipate that corn crops will drop, but to a lesser extent.

On the daily time frame the SOYB CFD has been traded in a range. Bollinger, MACD and Parabolic have been giving sell signals and only RSI-Bars has shaped a bullish divergence. It is located below 50. A bullish momentum may develop if the price crosses the Parabolic upper signal and the 200-day Moving Average at 991. A stop loss may be placed below the latest fractal low at 926 or the 5-year low at 901. After pending order activation the stop loss is supposed to be moved every four hours to the next fractal low, following Parabolic and Bollinger signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. The most cautious traders are recommended to switch to the H4 time frame and place a stop loss there, moving it after the trend. If the price reaches the stop loss without triggering the order, we recommend to cancel the position: the market sustains internal changes that were not considered.