An early break in the soybean market uncovered demand and futures were 3-4 cents higher at the close. CBOT markets continue to struggle for direction and have ebbed and flowed due to the latest news or rumor on US/Chinese trade talks. The tone from Washington on Friday was positive, and the market rallied ahead of a long US holiday weekend.
The Commitment of Traders report showed that for the week ending Jan 22nd, funds were net short 23,000 contracts of soybeans (-2,000), net long 7,000 contracts of soymeal (-3,800), and were net short 31,000 contracts of soyoil (+17,000). In soyoil, this was the smallest net short position since April of last year. Spot soyoil futures broke through long term chart resistance near $.30/lb three weeks ago but have drifted back to that breakout point this week.
If support near $.30 holds this week, a further rally to $.33-34 could unfold as funds cover the remainder of their net short soyoil position.
Key support in March soybeans held at the 100-day moving average on Friday, but the market remains caught in a range waiting on a US/Chinese trade deal.
