By : Kenneth De Zilwa
Chicago soybean futures appear to have hit a bottom post the trade war between Washington and Beijing as they had indicated the curbing demand for U.S. supplies of the oilseed in top importer China. Wheat dropped to a low USD 329 MT on the back of the U.S. spring crop boosted expectations of a bumper harvest.
Econsult called the soya price trend accurately in last months edition. The soya markets did correct lower and is currently trading lower at USD 349 MT.
The markets continue gradually edge up despite the selloff, however, we at Econsult feel that the lower price thrill seekers might find the bear market a bit over done and could be caught in bear trap i.e. on the wrong foot if they continue to sell. The market is bound to correct higher we feel that the short term trend could push soya to USD 355 MT as a trade deal between Beijing and Washington is reached at least for the next two or three months. The double bottom lows would confirm this reversal in price action.
In fact the current lows was last seen in November 2015
Econsult Recommendation : Buy 30% of your portfolio at current levels part for the overall trend still is looking soft