Focus: July Soybeans
Last week, soybeans gained 41.5¢ to close at $12.25 4/8. Prices have been on a steady rise since setting a low of $8.41 in March, rising over 40% in thirteen weeks. The strong demand (and lack of selling) reflects uncertainty about new crop production and a decline in international exports. The weekly chart of soybeans shows a breakout from an ascending triangle pattern. There has been a change to bullish +DMI dominance. ADX is at the 25 level and rising, indicating increasing trend strength. The current price level represents a 50% retracement of the major downtrend from July of 2008 until December of 2008. The next resistance level is $12.62.
Chart Courtesy of TradeStation
Dr. Charles B. Schaap is the author of ADXcellence—Power Trend Strategies and Invest with Success—Big Profits for Small Investors. Dr. Schaap is a commodity futures strategist and recognized authority in technical analysis of the financial markets. His website is www.adxcellence
