Monthly Analysis: Soybeans

2023-11-04T08:58:56-05:00November 4th, 2023|Monthly|

Soybean Cash Index: The Barchart National Soybean Price Index (NSPI, weighted national average cash price) completed a bullish spike reversal during October, confirming a move to a new major (long-term) uptrend. Theoretical Positions: Remaining cash bushels from the 2023 harvest could be held. End-users could cover long-term needs near the October settlement of roughly $12.40.

November Soybeans: The November 2023 contract moved into delivery at the end of October. Unfortunately, it is still showing up on this continuous monthly chart (slide 2). Next month we will turn our attention to the 2024 edition. The Nov23-Nov24 spread closed October at an inverse of 20.25 cents, putting the Nov24 contract at $12.6675.

Theoretical Positions:

  • Short Nov23 from roughly $13.5975 (October 12)
    • Investors may have lifted these short positions at the completion of the bullish 2-month reversal at the end of June, closing price of $13.4325.
    • Some may have gone long at this price, though risk is all the way back to the June 2023 low of $11.4425.
  • Previously short Nov22 from the June close of $14.58 (the completion of a bearish key reversal)
    • Bought back on October 12 at $13.96 for a gain of roughly 62.0 cents
    • Raising the short Nov23 to about $14.1275
  • Previously sold Nov22 $13.40 put options for approx. 55.0 cents on August 3
    • Stopped out at approx. 9.0 cents on September 23 for a gain of roughly 46.0 cents
  • Hedgers could look at lifting short Nov23 positions on a move to the target area this fall, or as harvest progresses.
    • The guaranteed price from this past February (US) is $13.76.
    • The fall price will be calculated during October, the daily closing price of the Nov23 futures contract.

The Teucrium Soybean Fund (SOYB) monthly chart remains a mess. The bottom line is it looks like the fund is still in a major uptrend following a bullish 2-month reversal completed during June. Theoretical Positions: Investors might’ve gone long at the June close of $27.32. If so, technically, sell stops would be below the previous 4-month low of $26.59 from October 2023.

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