NCDEX Soyabean under short covering; Support seen at 3738
Commodity Online | May 27 2020
UPDATED 11:00:19 IST

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Technically Soyabean market is under short covering as market has witnessed drop in open interest by 0.72% to settled at 73645 while prices up 16 rupees.

Now NCDEX Soyabean is getting support at 3738 and below same could see a test of 3710 levels, and resistance is now likely to be seen at 3796, a move above could see prices testing 3826.

Soyabean yesterday settled up by 0.43% at 3766 with prices underpinned by bargain-buying after prices dropped as normal monsoon outlook for this kharif season has brightened the prospects for soyabean cultivation starting next month.

Pressure also seen tracking weakness in overseas prices on concerns that the U.S. government's rhetoric about China's response to the coronavirus pandemic will dampen Chinese demand for U.S. supplies.

The U.S. Department of Agriculture said weekly soybean export sales were 1.669 million tonnes, topping forecasts that ranged from 800,000 tonnes to 1.6 million tonnes.

Brazilian soybean exports between May 17 and May 31 will total an estimated 7.2 million tonnes, with the total for the month pegged at 14.7 million tonnes based on the shipping lineup.

Normal monsoon outlook for this kharif season has brightened the prospects for soyabean cultivation starting next month. Meanwhile, the trade body has estimated exports for the year 2019-20 (October 2019 to September 2020) to fall by one lakh tonnes to 6 lakh tonnes.

The USDA confirmed private sales of 396,000 tonnes of U.S. soybeans to China, a day after reporting sales of an additional 136,000 tonnes to the world's top soy importer. In the May’20 WASDE report by USDA, the US 2020/21 soybean area is projected at 83.5 million acres compared to 76.1 million acres in 2019/20.

Trading Ideas:
--Soyabean trading range for the day is 3710-3826.
--Soyabean gained with prices underpinned by bargain-buying after prices dropped as normal monsoon outlook for this kharif season
--Pressure also seen tracking weakness in overseas prices on concerns that the U.S. government's rhetoric about China's response pandemic will dampen Chinese demand.
--Weekly soybean export sales were 1.669 million tonnes, topping forecasts that ranged from 800,000 tonnes to 1.6 million tonnes – USDA
--At the Indore spot market in top producer MP, soybean dropped 18 Rupees to 3898 Rupees per 100 kgs.

Courtesy: Kedia Commodities