The soybean oil market experienced vigorous selling today, April 29. Some say it is the result of the EPA's failure to provide direction after approving summer E-15 ethanol sales. Soybean meal closed higher but the soybean oil selling forced soybeans to go lower even in the face of a morning sale of 100,000 tonnes to an unknown destination. Another reason for today's selling could be that tomorrow is first notice day for May contracts.

Take advantage of today's weakness in soybean by considering bullish strategies. In my opinion, July soybeans will trade to $11.00. The daily chart provided here has a 200-day moving average, which is 1049 ½. Today's close was 1052. Soybeans closed above the 200-day moving average.  That is a positive for any market. 

The soybean market tried to stabilize overnight but got pummeled in today's session due to excellent planting weather, planting ahead of normal, weak chart patterns and soybean oil falling out of bed.  Another factor is the Chinese May Day holiday, also known as International Workers' Day, which starts May 1. 

Another chart is the monthly soybean chart. Sometimes monthly charts show the trends really clearly. This is a monthly reversal up, which is a very rare chart pattern in my opinion. The trend is up. 

Stephen Davis
Senior Market Strategist 
Walsh Trading

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