This past Friday’s bearish November WASDE report gave the bears in beans what they needed to push January 2013 soybeans down $0.44½ on Friday and as of 10:00AM CT Monday down $0.40. Last week January 2013 Soybeans opened at $15.20¾ per bushel and closed the week at $14.51¼. Next stop possibly $14.00 and from there a retest of $13.50 like we saw at the end of May 2012 as plantings were doing very well.
On the daily chart we see ADX at 33.9 and rising as well as DI Differential at 33.8 and rising with DI- over DI+ reflecting a strong trend. MACD is just pulling down away from the signal line adding divergence and Stochastics are in deep oversold territory. The red vertical lines you see are technical set-ups you will find easier to catch using a tool called the TS Analyzer (there is an FX Analyzer for Forex trader).
Proceed to Page 2 for the latest COT Data...
COT Data
On the weekly chart we can see that back in the week of July 2, Producers had a net short position of -374,864 contracts, and look where the market was trading. Since then, we have seen weekly liquidation with this past Friday’s report showing Producers now net short -235,030 contracts. We see liquidation in net longs by Managed Money now at 161,724 contracts. Something you should be aware of — Swap Dealers over the past couple of weeks have been adding to net longs now 63,039 contracts.
If you need help understanding how to understand how to use the NEW COT report to your benefit get instant access to my new e-book "What Lies Beneath ALL Trends". It is filled with eye opening information.Commercial Net Tracker instructions: This form tracks the Commitment of Traders (COT) data for the commodity futures market. This form "looks" at the most recent five weeks of COT data and provides visual indications of the data. A) If the current value is at a 12-month low, the cell will display a red/burgundy background. B) If the current value is at a 12-month high, the cell will display a green background. C) If the current value went from net negative to net positive, the cell will display a blue background (indicating a bullish condition). D) If the current value is both a 12-month high and also went from a net negative to a net positive, the background will be green. You should view the data with green backgrounds to determine if they also went from net negative to net positive.
Proceed to Page 3 for this week's detailed fundementals...
So how long will the November WASDE report effect last? Possibly a while, but as harvest pressure starts dropping and supplies drop we could see the next move up starting. One positive for the bulls was the increase in China’s exports. Could China’s slowdown be turning around? I am sure the bulls hope so, China is the largest consumer of soybeans. Make sure you keep an eye on bean plantings in South America, plus their growing season.
Have a prosperous trading week.
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