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SOYBEAN

NCDEX Soybean future traded bullish during the month of March month so far due to rising demand in the domestic market with higher demand for Soy Oil and other vegetable oil prices. Moreover, reports of higher exports of soymeal and crush from India supported uptrend. Moreover, prices are currently finding strength at the higher levels with delayed harvesting in Brazil in the month so far. The CONAB data has forecasted soybean production at 135,13 million tonnes of soybean in 2020-21, higher than 133.81 million tonnes from February month forecast. It is also kept higher against 124.85 million tonnes in last year, but then prices are not found correction. By 15th March, NCDEX Soybean futures has closed at Rs.5406/quintal, higher by 7.62% compared to Rs.5023/quintal by 26th February.

Fundamentally for the coming month, we are expecting NCDEX Soybean Futures to trade bullish with estimation of improved demand for soybean crush and ail to China from India and United States. Moreover, the domestic traders and industrialists have also pointed out for higher export demand for Soybean meal from India. Dryness continue to prevail in Brazil and Argentina in the ongoing harvesting season. Correspondingly, the recent WASDE monthly report has pointed out further rise in crush, exports and lower ending stocks. U.S. Soybean crush and exports are projected at 2.20 billion bushels and 2.25 billion bushels respectively, ending stocks remain at 120 million bushels, down 405 million bushels from last year’s record. Global soybean crush is forecast up 1.6 million tonnes to 323.6 million tonnes as higher crush for Argentina and Brazil is partly offset by lower crush for China. Higher crush in Argentina results in higher meal and oil exports. Soybean crush for China is lowered 1 million tonnes to 98 million tonnes. Overall, we continue to remain bullish in NCDEX Soybean futures for the month ahead.

On the monthly chart, NCDEX Soybean (Apr) future has given a breakout of Cup & Handle pattern, which is a bullish continuation pattern in nature. Moreover, the price has been rising continuously from the last couple of months without enabling a selling pressure, which is an indication of bullish trend. On a weekly time frame, the price has moved above the upper band of Bollinger formation and 200 weeks Exponential Moving Averages, which suggests a northward move for long term. Amomentum indicator RSI (14) & MACD has been showing positive crossover, which point-out positive strength and buying interestamongthetraders. So based on the above technical structure one can initiate along positionin NCDEX Soybean (Apr) future at CMP 5440 or a fall in the prices till 5400 levels can be used as a buying opportunity for the upside target of 5800. However, the bullish view will be negated if NCDEX  soybean (Apr) closes below the support of 5240.

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