Soybeans broke down to start the week which has continued to add technical pressure to prices. Corn and wheat have been able to hold their own. Will that continue or will there be a reversion to the mean?
Soybeans
Tuesday’s Recap
March Soybean futures closed the day at a contract low of 978’6 Tuesday, lower by 7’2. Combined volume came in at a one month high of 410,287, with March seeing a heavy 142,638 done. Across all maturities, open interest rose by 1,338 (0.15%) to end the session with 915,659 outstanding. The March maturity rose 3.88%, or 1,338, to finish at 381,153.
Technicals
January soybean futures are making new contract lows this morning on a continued breakdown below the lower end of the month-long range. How much more downside is left is the million-dollar question. The RSI is at 34.74, so though we have seen heavy pressure in the last week it hasn’t been enough to put the market into oversold territory. In the summer months we saw the RSI reach as low as about 21. With the market in uncharted territory, we need to revert to the continuous chart to find a potential support level. Based on that the next downside objective for the Bears comes in from 955-959.
Technical Levels of Importance
- Resistance: 1002 1/2-1006 1/2***, 1011 1/2-1013 3/4**, 1018-1024 3/4****
- Pivot: 986 1/4-987 1/4
- Support: 977 1/4-980 3/4*** 973 1/2**
Popular Options
The Jan 970 put saw the most changing hands with 6,422 contracts done. Options with the highest open interest are the March 1100 call with 17,258, and the March 980 put with 29,434.
Volatility Update
As measured by SVL, implied volatility ended the session higher, adding 0.34 to settle at a one week high of 16.37. The 30-day historical volatility finished dropping 0.0171% to 13.98%. The SVL Skew was slightly up with the 30-day gaining 0.26, finishing the session at a one week high of -0.13.
Seasonal Tendencies Update
(Updated on 12.16.24)
Below is a look at historical price averages for January soybean futures on a 5, 10, 15, 20, and 30 year time frames (Past performance is not necessarily indicative of future results). As with corn, December has been a historically friendlier month for soybeans. Keep in mind though that we’ve seen a lot of counter seasonal trends for beans throughout the year.
Commitment of Traders Update
(Updated on 12.16.24)
Friday’s Commitment of Traders report showed funds trimmed their net short position slightly, bringing it to -58,320.
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