Soybean Oct Fut has Resistance around Rs 3898: Emkay

Weak bias witnessed in domestic market soybean prices in today’s trade session owing pressure from good crop in the field. Soybean prices at Indore market moved up by Rs 1/quintal to Rs 4576/quintal. Prices in Kota market moved down by Rs 49/quintal to Rs 4583/quintal. Meanwhile, soybean prices at Nagpur market moved down by Rs 26 to Rs 4769 per quintal.  Acreage under soybean crop (as on 6th Sep’12) reported at 10.694 million ha, up by 3.55% (0.367 million ha) from same period last year. Better rains at soybean growing major regions to yield to good crop but some areas are in flooded condition.

Higher acreage under soybean crop and improving weather is to keep the prices in weak bias for medium term. As per SEA’s of India, the export of oilmeals during August 2012 is reported at 120,091 tons, down by 59% compared to 291,466 tons in August 2011. Soymeal exports for the month of August 2012 reported at 10,005 tonnes. Soymeal FOB prices from Indian port averaged for August 2012 at US$ 760 per tonne, which is 7% higher from July 2012 average prices of US$ 709 per tonne. Forward booking for soymeal exports are already started with the exporters.

Technical Outlook

Soybean Oct’12, futures prices corrected significantly to close at Rs 3840 levels. Resistance is around to Rs 3898 levels breach of this it could extend to Rs 3941 levels. Support is at Rs 3794 levels and next support is at Rs 3714 levels. Volume and open interest supporting downside movement. MACD is showing sing of weakness in the price. RSI-14 is trading in oversold territory to signal continuation of downward trend.

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.