Fundamental Analysis

April soybean futures ended lower on account of profit booking on Thursday after rise of last two days. However, March contract was up on account of expiry on March 19, 2010 and firm physical market.

This week USDA’s weekly export sales of soybean were about in line with trade expectations. Net weekly export sales for soybeans came in at 214,100 tonnes for the current marketing year and 525,000 for next year for a total of 739,100. As of March 11, cumulative soybean sales stand at 93.1% of the USDA forecast for 2009/2010 versus a 5 year average of 84.4%. Sales need to average 107,000 tonnes each week to reach the USDA forecast. Net meal sales came in at 92,500 tonnes for the current marketing year and 65,800 for next year for a total of 158,300. Cumulative meal sales stand at 82.2% of the USDA forecast for 2009/2010 versus a 5 year average of 60.3%. Sales need to average 59,000 tonnes each week to reach the USDA forecastof 59.0%.

Technical Analysis

Prices closed below its 10 Day and below its 20 Day EMA, which indicates bearish market sentiments.

14-Day RSI is at 36.08 and trading in the neutral region.

Daily MACD turned in negative territory.

Outlook

Soybean prices are expected to trade lower on poor export demand of domestic soy meal. However, in the long term perspective, soybean prices are expected to trade lower on higher global soybean production estimate this year as compared to last year.

Courtesy: Angel Commodities

World events analysis and how they affect Markets

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