Is Soybean Ready for Significant Gains? Coffee Gives Signals of Life

Agricultural futures started the week mixed as most grains are trading in consolidation patterns. However, Soybeans looks it is building a bullish run in the short term due to technical and fundamental factors.

CoT: Soybeans long interest increases

Soybeans are trading positive on Monday, but the bushel remains moving sideways inside a range between 8.960 and 9.100 areas. Technical conditions are deteriorating and fundamental factors are signaling for more gains in the short and middle term.

The latest US Commodity Futures Trading Commission CoT report showed that net short positions declined by 39% in the week of June 18 to 55,307 contracts. So investors are becoming more and more bullish on the oilseed.

On the fundamental area, any improvement in the trade war following the Trump-Xi meeting that will start this week will push soy prices higher.

To the upside, the pair is contained by the previously mentioned 9.100 area. Immediate resistance at 9.155, June 18 highs. If the oilseed breaks above that level, it will find selling zones at the double top at 9.200 performed on December 12, 2018, and February 1, 2019.

To the downside, if the bushel breaks below the 8.960, it will find support at 9.800 and then the 8.730-60 congested area.

Corn consolidates levels at 4.400

Prices of corn are moving sideways on Monday as investors are waiting for the new crop report of the US Agriculture Department to be released early this week.

Corn is currently trading 0.50% positive on the day with the unit moving around 4.415. The grain remains in a range between 4.300 and 4.500 as it is consolidating levels above the critical support at 4.360.

Wheat up to test 5.300 area

After a brief period of consolidation performed on Friday, wheat opened the week with gains as investors used 5.200 as a new leg for another bullish run.

On Monday, wheat broke the 5.260 resistance to extends gains and tested the 5.300 area. It is now trading at highs since June 18.

Sugar finally strikes back

Futures of sugar is trading positive for the first time in the last six sessions as the unit finally found support at the 50-day moving average level at 0.1210.

Last week, sugar fell around 4.20% in its first negative week in fourth periods. Investors were worried about the speculations of less-than-expected Thai sugar sales.

However, the unit started the current week with a fresh market sentiment that is leading the price up over 1.0% on the day to test the resistance at 0.1240. The unit is now trading back at 0.1230, but if it can break above that level, it will find resistances at 0.1250 and 0.1270.

But experts don’t have much confidence about sugar recovery as technical studies are weak. The chart pattern is suggesting more losses at least to the 0.1200 area.

Coffee rejects the 200-day MA at 102.20

After two positive sessions, Coffee futures are trading down 1.50% on Monday as the unit wasn’t able to sustain gains above the 200-day moving average at 102.20.

Coffee is now trading down at 100.20 and technical conditions are signaling more declines in the short term. If the unit extends its decline, it will find support at the 98.00 area and the 96.00 level.