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Soybeans bust through resistance ceiling

02/14/2014 @ 8:07am

March CBOT soybeans rose sharply Thursday, closing above a multimonth resistance ceiling at the $13.39-$13.40 zone. That zone now becomes support and must hold on a closing basis Friday to confirm a bullish upside breakout.

Soybean prices gained support from news that U.S. oilseed stockpiles are declining due to strong export demand, which could create tight conditions until the U.S. harvest in the fall.

Technically, the bulls tested this ceiling at $13.40 for the third time in a week Thursday and were successful. It was a tough ceiling to crack, and the bulls need to defend the higher price levels above $13.40. If a weekly close is achieved above $13.40 it would be a very bullish signal and would open the door back toward the $13.69-$13.77 region.

On the downside, support now comes in at $13.40-$13.39. Declines back under that floor would suggest Thursday's rally was a "bull trap."

Daily momentum is rising but isn't yet overbought.

$13.99 3/4 -- the contract high 
   $13.18 3/4 -- the 10-day moving average 
   $13.02 3/4 -- the 20-day moving average 
   $13.01 1/4 -- the 40-day moving average 
   $11.27 1/2 -- the contract low 
 
MARCH SOYBEAN MEAL -- combined pit and electronic trading

March CBOT soymeal continues to climb to new contract highs this week, and Thursday ushered in another day of strong gains. The trend is bullish, but market action has turned volatile this week. On the upside, a minor target from the weekly continuation chart comes in at $460.60.

Important support lies at $438.10, the Feb. 11 swing low. As long as the market holds above that floor on a closing basis, the uptrend will remain intact.

$452.90 -- the contract high 
   $443.20 -- the 10-day moving average 
   $434.40 -- the 20-day moving average 
   $428.50 -- the 40-day moving average 
   $303.00 -- the contract low 
 
MARCH SOYBEAN OIL -- combined pit and electronic trading

March CBOT soybean oil continued to advance, posting a strong close Thursday. The near-term trend is bullish, and the market is holding gains above 40-day moving average support, which is a positive chart signal. The 40.00-cent zone is a bullish objective and it represents the Dec. 20, 2013, daily high. Support lies at 38.47 cents. Declines under that zone would be a bearish signal and open the door for a downside correction. The primary longer-term trend remains bearish.

57.43 -- the contract high 
   38.43 -- the 10-day moving average 
   38.00 -- the 20-day moving average 
   38.37 -- the 40-day moving average 
   36.80 -- the contract low

Write to Kira Brecht at copydesk@dowjones.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

(END) Dow Jones Newswires

February 14, 2014 08:00 ET (13:00 GMT)

DJ Soybeans Move Through Resistance Ceiling -- Technical Analysis->copyright

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