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Soybeans

Week 14: ZSK2021 Uptrend Channel before it dropsSorry for the late post .. let's get to it. Based on the price movement last week, here is what I saw: (1) Strong bullish movement driven by the news, but it still did not break the previous High. (2) The Seller is pressing the price down from the top (Thursday, 01 April 2021), it shows that $14.44 is holding it's level. (3) As indicated last week, my support level is now at $14.10 From here, I am expecting some consolidation in the form of uptrend channel until the price is making a Lower High; then it is time for us to Short the market. This week my Pending Order: Sell Limit at $14.35 Stop Loss at $14.51 Take Profit at $13.90 Risk Reward Ratio: 2.66R Let me know if you have other opinions, we can discuss it in the comment sections.
CBOT:ZSK2021
by machintose
3
What's with these high Soybean Prices?!Soybean futures have been trending higher since reaching a low of $8.0825 per bushel in April 2020. The rally intensified when the price rose above the $9.50 level in late August. The move over the February 2018 high and critical technical resistance level at $10.71 in October set the oilseed futures on a path for beans in the teens for the first time since 2014. After trading to a high of $14.60 on the May contract on March 8, May soybean futures pulled back below the $14 level to a low of $13.6425 on March 30. The very next day, the beans exploded in the most significant rally of this year. May futures moved over 90 cents higher from the March 30 low to the April 1 high before pulling back to the $14 level. In any commodity, trading ranges tend to widen as the price appreciates. In soybeans, we are now going into the 2021 crop year as farmers will be planting the seeds that feed the world this month. Last week’s rally came as the US Department of Agriculture surprised traders with their planting forecast. The USDA planting report lights a bullish fuse On March 31, the USDA reported that farmers plan to plant soybeans on 87.60 million acres. While the number was higher than the USDA’s 2020 intentions of 83.51 million, it was far lower than the average trade estimate of 89.996 million acres. The USDA also said that farmers would plant 91.144 million acres of corn, below the average trade estimate of 93.208 million. The report lit a bullish fuse under the soybean and corn futures markets, pushing corn to a new and higher high at $5.85 per bushel on April 1, the highest price since July 2013. Meanwhile, the continuous soybean futures contract rose to a new marginal high of $14.5625. The last time the beans reached that level was in June 2014. The buying runs out of steam- Backwardation in the beans After reaching the most recent high, soybeans moved back to the $14 level at the end of last week. As the daily May futures chart highlights, beans rose to a new high on the highest volume of 2021 when over 410,000 contracts changed hands. The move had all the hallmarks of a short-term blow-off top in the bean futures arena. Farmers likely used the rally to do some hedging. Source: Barchart May soybeans settled at $14.02 per bushel on April 1. The new-crop November contract settled $1.3825 lower at $12.6375. The backwardation or discount between beans for nearby delivery and for the new crop that is going into the ground reflects both nearby tightness and optimism that the 2021 crop will satisfy the ever-growing demand for the oilseeds, which could be a leap of faith. Expect lots of volatility as we are now at the start of the season of uncertainty The soybean price during the fall harvest will depend on the weather conditions across the US’s fertile plains. A drought or any other event that interferes with crop progress over the coming weeks and months could push prices far higher. In 2012, drought conditions moved nearby soybean futures to an all-time peak of $17.9475 per bushel. The next levels of long-term technical resistance in the bean market stand at the May 2014 $15.3675 high and the July 2013 $16.30 peak, which is the gateway to a challenge of the 2012 record high in the oilseed futures. Any weather problems that interfere with crop progress could potentially push beans out of the teens, on the upside for the first time. Meanwhile, one of the critical factors for global soybean demand is China. The Chinese are rebuilding the hog population, which requires soybean meal, the primary ingredient in animal feed. Reports of another outbreak of African Swine Fever could weigh on the demand over the coming months. Meanwhile, if the Chinese turn out to be significant buyers, we could see a continuation of the rally that began one year ago, even if the US crop is robust. Expect lots of two-way volatility in the bean market over the coming weeks and months as we enter the 2021 crop year. Price volatility can create a nightmare for producers and consumers looking to control costs. However, high levels of price variance are a paradise for nimble traders with their fingers on the pulse of markets. Trading advice given in this communication, if any, is based on information taken from trades and statistical services and other sources that we believe are reliable. The author does not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects the author’s good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice the author provides will result in profitable trades. There is risk of loss in all futures and options trading.
CBOT:ZSK2021Long
by Andy_Hecht
Week 12: ZSK2021 Ranging with a slight bullishLast week our target at $1440 had not been achieved, the price went down and made a retracement at the end of the week. Overall it is not a Sell yet, we are still within Buyers area ($13.90 to $14.24). The immediate Decision Point (DP) is at $14.24 where if it breaks, then we anticipated that it will go to our $14.40 level (which we will sell). If it doesn't break, then it will range within the buyer area. My view remains the same as last week, we look for the opportunity to short and feel free to scalp it while it is ranging. If you have a different view, let's discuss it at the comment area below.
CBOT:ZSK2021
by machintose
5
Inflation trade: Bulls leading battle of attrition on bearsThis is the type of inflation that the masses ignore, that happens while they cheer at Chavez stimulus checks. Look at images of Venezuela 15 years ago, so many smiles, so happy crowds. While Germans were carrying buckets of cash and starving actually farmers were doing pretty well, they profited greatly. Probably for similar reasons the clueless revolutionaries in Russia called them "bloodsuckers". How outrageous they profit while others suffer oh no! All is their fault, not the people actually responsible. But what the cheering average people worrying about their day to day lives don't see is the worst type of inflation: basic goods prices go up, production goes down. Hurray, everyone gets more "money", everyone gets more pointless pieces of paper, great, I will finally be able to afford, checks notes, nothing at all. There is LESS STUFF for everyone. These people, especially the urban ones, they live in fantasy land, I've seen some of those cretins say supply and demand is a myth. WAT? That's so dumb, boy are they about to learn their lesson. It is an endless circle. Prices go up, prod goes down, there is less stuff, people push prices up, prices go up, prod goes down, and so on. Maybe reptilian brained people panic fight each other for toilet paper and pasta again? Rubs hands. Few eat soybeans, only california millenials from what I hear, what it is used for is feeding domestic animals, not the friend kind, the food kind, soybean gets turned into milk, steaks, pork chops, bacon and beef jerky and all those industrial products made from meat that americans eat like candy. Americans have a ghrelin disease, they get ravenously hungry they'd kill to eat buckets of food. Also the situation in Argentina not getting better, farmers waging war to the socialists. The weather is really dry in Argentina, these big bags of beans could catch fire very easily, damn it would be a shame if they started to burn (again). The freezing cold weather did not help, other producers are rekt because of cold & wet. Who else is heavilly impacting this? The big buyers in the far east have stocks but they'll have to buy eventually hehe. In this inflation env, any negative event will push the price up anyway, and "positive" event will just make it pullback or sideways a bit, maybe only slow it down. I think the price will chop chop a bit on its way up, chop chop not as hurry up I mean go back and forth :p, then bears will break and it will slide vertically. To ~17$, which is a very special price you know.
CBOT:ZS1!Long
by MrRenev
4
Week 10: ZSK2021 Bullish Ahead, wait for a retracement.Based on last Friday closing, I would expect the price to be bullish to $14.43 and making a retracement there. However, I was proven wrong, the market gap up and push the price higher than $14.43 There is no more references that I can use as there is no data on the "left"; the only way to read the market is only by reading the Price Action. I did some research on historical data and found that the highest price for SoyBeans was $17.6825 (03 September 2012). If we are studying those data, there is a potential reversal at $16.50 where it was a strong resistance level created in July 2008. Having said the above, we are not here to predict but to trade. Our short-term observation: (1) The price is on the upper-band of trend channel, either it will break or continue to range. (2) Looking at the current movement, I don't think the gap will be closed that fast; the impulse movement upward was so strong and normally it will become a good support zone (area to buy). (3) I left my line at $14.30 as a buy area marking. Additional info which I mentioned above: www.macrotrends.net If you have other views or opinions or ideas, let's discuss it on the comment below.
CBOT:ZSK2021Long
by machintose
8
Week 08: ZSH2021 Wait for a break to SellPatience is one of the key traits in trading. Last week we did not see much action, the price is ranging in a tight movement 20.4 points for a whole week. This week we are still waiting for a confirmation to short the market: (1) Price level at $1,390 is being respected and currently creating a "fake out" line. (2) My reversal zone remains at $1,400 (for now) (3) The sign of going down will be confirmed when $1,370 is broken. Overall, my view remain bearish with the following trade plan: Sell Pending Order at $1,400 Stop Loss at $1,410 Take Profit at $1,322 RRR = 7.8R I will monitor on daily basis too, shoot me a question if you need any clarifications or exchange ideas.
CBOT:ZSH2021Short
by machintose
9
Week 7: ZSH2021 Let's wait to SELL againMy overall sentiment is still Bearish bias . Today the opening price jumped 14 points and the bull kept running to the nearest Supply Zone. In general view, the seller is still strong and therefore, we participate in selling too. The nearest SELL area is between $1,395 and $1,400 (5 points zone), with a Stop Loss at $1,411. Our first Take Profit level is at $1,375 (2.27R). What if the price did not hit the Supply zone at $1,395 - $1,400 ? Then we have to see the Price Action movement and market structure. Good Luck!
CBOT:ZSH2021Short
by machintose
Week 6: ZSH2021 Price is in the sell areaFollowing up last week analysis, the price will be visiting Supply area prior going down. My personal Sell Order will be at $1,417 (it depends on the price action in the next 2-3 H4 candles, I may short it early too). The stop loss will be at $1,438 (New Higher High) and our Take Profit will be quite low (at least $1,275). The simple sign will be at $1,417 area, if the body size of the candles are not prominently bullish; and there is a formation of Lower High (LH); I will go at whole-nine-yard to short the market. Just kidding, money management is still important, perhaps 10% to 20% equity to short this opportunity.
CBOT:ZSH2021Short
by machintose
3
Week 05: ZSH2021 Short Term BullishOn H4, the price has broken the down trend channel and making a Higher High. From 27 January to date, the price movement is forming another flag on the higher band; also, to add some confluences, if we observed the Price Action on the candle stick, there were some rejection to go down. Based on the above, I think the price will pick up some liquidity at $1,417 area prior going down. Short term (1-2 days) will be bullish as we are still in bullish flag area.
CBOT:ZSH2021Long
by machintose
2
Week 04: ZSH 2021 We are entering a ranging weekLet's keep it short, this week the price will be in ranging mode. The range is between $1,338 to $1,280. If you have shorted earlier, you can take profit some of your positions and keep some until it hits full TP at $1,280. If you are a speculator, now it is a good time to Long (buy) the market, but you must exit at $1,338 area; then switch to Short the market. In general, when the market is in ranging, we can scalp it Up and Down. Trade wisely, Trend is your friend.
CBOT:ZSH2021
by machintose
4
Week 02: ZSH 2021 Uptrend Channel, waiting for a breakApology for the late post. Week 02 for ZSH 2021 is still bullish looking. Yesterday on H1, we can see the price movement candle by candle that there were no sign of weakness. In the last hour of market, it created a strong rejection and buyer jumped in with a significant momentum. Let's see on the overall picture in H4, the movement is still within the Uptrend Channel, we only can short the market when we see a break at $1,370 level. As at I wrote this, from H4 down to M5; there are still no sign of Seller coming to the market. Buyer is still dominating the market, be cautious if you plan to long the market. No trade call for this week. -SatayFX
CBOT:ZSH2021
by machintose
Agricultural Commodities Ripping! Food Prices to Rise in 2021!Ending my posts of major themes to look for in 2021, I want to end with the agricultural commodities. Particularly Corn, Wheat and Soybeans. The agricultural commodities are some of my favorite assets to trade, and I do not think many people pay too much attention to them. I focus on the three mentioned above, but you can also trade sugar, coffee, cocoa, orange juice (yes seriously), cattle, hogs, and pork bellies to name a few more. Let me give you a quick run down on the ag commodities. Corn is the most traded agricultural commodity, and is an important food source for both humans and animals. What makes Corn important is that it can be grown in a variety of climates and conditions, unlike the other agricultural commodities. Other uses include starches, corn oil and fuel ethanol. According to my handy dandy commodity handbook, approximately 35 million hectares are used exclusively for corn production world wide. Just as Oil has different qualities (Brent, West Texas, Canadian West etc), Corn does as well. There are different grades but the most important are high grade number 2 corn and number 3 yellow corn. The futures ticker for corn contracts is ZC. The top 5 producers of Corn in the world are: The United States, China, Brazil, Mexico and India (Canada makes it in 9th place). Corn has had an amazing run since June. We will get to the why when at the end of this post, but pay attention to the commodity charts. These are all going to be LONG term weekly charts. You can see that Corn is breaking out, and in fact, will confirm a breakout with this weeks close, which occurs today. Lot of room higher to go in 2021. The breakout zone will be our support, and as long as we remain above, Corn moves higher. Wheat is the second most produced agricultural commodity. Rice comes in at third for those that are interested. No country necessarily dominates wheat production a la Saudi Arabia with Oil and Kazakhstan with Uranium. China, India, Russia, the United States, and France produce the most wheat in the millions of tons. Canada, Australia, Germany, Pakistan, and Ukraine also boast significant production. The future contract ticker for Wheat is ZW. Wheat on the weekly is setting up to breakout. Just like Corn, we would confirm a breakout on the weekly chart by the end of today. Finally, Soybeans. Perhaps the more ‘mainstream’ financial media agricultural commodity that has seen plenty of coverage due to the US-China trade deal. Part of the phase 1 deal was for China to increase their purchases of US Soybeans. I am focusing on the the whole soybean, but most soybeans are used for soybean oil and soybean meal. The United States dominates the Soybean market, composing 50% of the total global production. Brazil comes in second at around 20%. Many analysts predicted Brazil to be the big winner in a US-China trade war spat, as China could look to Brazil for more Soybean exports. The futures contract for Soybeans is ZS. Let’s take a look at the other traded forms of soybeans which have their own futures ticker. Soybean Oil is a vegetable oil and is one of the most used culinary oil in the world. Soybean Oil is also popular as a biodiesel. Believe it or not, but there are cars that have engines which can convert from regular diesel to Soybean Oil during production. They are known as ‘frybrids’. The futures ticker for Soybean Oil is ZL. Soybean Meal is a quick one. Whatever is left from the extraction of Soybeans into Soybean Oil can be converted into Soybean Meal. This is used for high-protein, high-energy food for feedstock for cattle, hogs, and poultry. The futures contract for Soybean Meal is ZM. Soybeans have been ripping in 2020. Again, China demand and the US-China Trade war headlines play a large part, but there was some other factors which we will discuss soon. Just like Corn and Wheat, Soybeans is set to confirm yet another breakout with a weekly candle close today. The agricultural commodities do not get the attention they deserve, and as you can see, they have made huge moves. For traders, they present a great trade opportunity due to the volatility, but also add on some more risk. Consider at least watching them if you do not want to trade them. M readers know I am extremely bullish on the agricultural commodities and agriculture in general. Jim Rogers is the one who got me excited about this sector. His argument is that most young people do not want to become farmers anymore, and that the average age of farmers is well above 60. Governments may need to create larger incentives to get young people to take up farming. I see some issues and challenges for agriculture, but will be rectified by human ingenuity. The first issue is soil. A lot of soil sucks due to the pesticides and other chemicals we use. If the soil is not great, the crop will not have the full dose of nutrients and could lead to health issues down the road. As many of you are aware, the organic food movement is a huge trend, and will grow year by year. Soil replenishment will be big. I have head some things in the past about zinc being used to replenish soil, particularly in California. Phosphorus and Potash also come in mind. In fact, some foresee a phosphorus faming crisis. A big issue for farming has been climate change. Obviously farming is cyclical. Winter has been lingering longer, especially on the East Coast. Farmers tend to await for certain birds to return to let them know Spring is here and it is time to plant crops. But Spring has been coming later while Winter lingers longer. Climate change will continue to disrupt agriculture and this could lead to a shortage of crops. In fact, this is the primary reason for the spike in Corn and Soybeans this year. Iowa is where the majority of these crops are grown in the US. Millions of acres were destroyed due to the storm in Iowa in August. This has led to spikes in agricultural commodities, and some say, points to a food crisis in 2021. Finally, something not many people consider are the ramifications of green energy. This info I learned from Peter Zeihan’s book, “Disunited Nations“. Highly recommended for anyone with an interest in geopolitics and where the world is going in the future. Green energy is coming. We all know it. Governments will be spending a lot for green infrastructure. Due to the fiscal policy required to combat covid, taxes need to go up. The best way is through green taxes because they know the people will not complain. Government will say these taxes are going to be used for green infrastructure which will aid in an economic recovery and creating jobs. The issue, as Mr. Zeihan states, is that solar panels and wind turbines need to be put in areas that are very sunny and/or windy. These areas tend to be where the best agricultural land is situated. So nations would have to sacrifice agriculture for energy. In his book, Zeihan states that there only a few nations which can come out as winners in this predicament. China is not one of them. Do not panic, a lot of these issues can be remedied. In house and Greenhouse farming can be a way to cope with the effects of climate change and unpredictable weather patterns. Vertical integrated farming can be a solution to allow for green energy infrastructure to be built in the best agriculture lands, and can also be a solution for nations that do not have much agricultural lands. So yes there will be issues, but human ingenuity will get us through it. The question is how long will it take? I want to end of with Covid. It seems we are setting up for a food crisis next year. Tons of articles about supply chain disruptions due to covid and worsening food insecurity for many nations. If this winter turns out to be a dark winter due to covid cases, the likelihood of empty shelves increases. A lot of this could also have an impact on the prices of agricultural commodities. Canada is already preparing for this. In Canada’s Food Price Report 2021, bread, meat and vegetable prices are set to rise between 3-5% in 2021. The average Canadian family will pay up to $700 more for food in 2021. The agricultural charts are pointing to higher food prices. Covid and Climate will have impacts, and hence why I am bullish on this sector going forward.
OANDA:CORNUSDLong
by Uncharted-FX