U.S. soybean futures fell Wednesday, as market participants took profits amid damped optimism that a months-long rally can further extend its course.

Soybeans for May delivery closed down 4 cents at $14.22 a bushel at the Chicago Board of Trade.

Market participants were continuing a selloff that began a day earlier, sparked by disappointment when soybeans on Tuesday hit a 7-month intraday high of $14.52 1/4 but then dropped and settled lower. A U.S. Department of Agriculture supply-and-demand report on Tuesday failed to provide any surprising forecasts to push prices higher.

Soybean prices still have upside potential in the longer term due to expectations for tighter supplies and growing demand, analysts say. But prices likely fell Wednesday due to selling by speculative investment funds and to technically-driven trading since soybeans met resistance when they passed the $14.50 level, traders said.

Soybeans have rallied since mid-December on gradually falling forecasts for the size of South America's soy harvest. Uncertainty about the final size of drought-stricken crops in Brazil and Argentina could still send prices higher, as could concerns that soybean prices need to be higher to attract more U.S. farmers to plant soy, boosting future supplies, analysts say.

"We've still got to attract some more acres here as long as we can," said Jerry Gidel, analyst with Rice Dairy.

But some analysts think those concerns may already be adequately priced in to futures. Also, as soy prices have rallied, investment funds have piled in, placing a growing number of bets that prices will keep rising. The number of short positions currently held by managed funds in soybeans is low.

Since short positions can buffer price declines as their holders move to cover them by buying futures, their low current number makes the soybean market potentially vulnerable to a fast, sharp selloff if many market participants decide to exit long positions around the same time, analysts say.

In other markets, CBOT May corn closed 1 1/4 cents higher at $6.36 a bushel, helped by concerns about tight current supplies. Farmers are demanding high prices for their on-hand corn, harvested last year, amid low inventory levels.

CBOT May wheat rose 2 1/4 cents to $6.28 a bushel, due to expectations for greater wheat usage in animal feed and concerns that a selloff Tuesday was too steep.

Kansas City Board of Trade May wheat rose 3 cents to $6.44 a bushel, and MGEX May wheat rose 4 1/2 cents to $8.38 1/4 a bushel.

-By Owen Fletcher, Dow Jones Newswires; 312-750-4120 begin_of_the_skype_highlighting 312-750-4120 end_of_the_skype_highlighting; owen.fletcher@dowjones.com