Fundamental Analysis

April soybean futures ended lower on third consecutive day amid subdued trading activity on account of poor export demand of domestic soy meal.

The USDA’s export inspections data released on Monday, which revealed that the export inspections were below trade expectations for soybeans at just 30.9 million bushels.

Cumulative inspections stand at 81.3% of the USDA's export projection for 2009/10 versus a 5-year average of 69.1%. Still, inspections need to average just 10.1 million bushels each week to reach the USDA's projection.

Traders are looking for the USDA to lower its estimate of 2009/10 ending stocks to below 200 million bushels near 195 million on next Wednesday's supply/demand report. Ending stocks were lowered to 210 million bushels in February from 245 the prior month.

Technical Analysis

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

14-Day RSI is at 31.7 and is moving towards the oversold region.

Daily MACD is in positive territory.

Outlook

Soybean prices are expected to trade lower amid subdued trading activity on lack of fresh fundamentals (for short term). In the long term perspective, soybean prices are expected to trade lower on poor export demand of domestic soy meal and favorable weather in Argentina for soy bean crop. Globally soybean production is estimated higher as compared to last year also in favour of bears in the market.

Courtesy: Angel Commodities

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