Soybean to trade lower on record domestic output

Market Roundup

Soya bean market witnessed gap up open but pared all the gains in the very next hour to hit new intraday low. Since then the price traded in a narrow range but closed at the days open.

Fundamental Outlook

A USDA official estimated Argentina's soybean crop at 42.5 million tons, down from the January 12th estimate of 49.5 million tons which triggered upward momentum in the overseas market which in turn fuelled the local prices.

Soya bean seed prices are expected to trade lower in the long run on account of record high domestic production estimates and higher stocks of Soya bean seed and other oilseeds.

The domestic factors such as the higher production estimates and profit booking at the new contract high levels weighed on the prices.

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Technical Outlook

The price though made its way above the channel but closed back into the same again. A long legged Doji of candle sticks has formed which shall induce lower price action on breach of the days low to find support at the moving average and the channel trend line support. Support is seen at 2350 – 2300 levels and Resistance is placed at 2450 – 2500 levels.

Courtesy: Motilal Oswal Commodities Broker Pvt. Ltd.