SINGAPORE: The CBOT soybean January contract may test a resistance at $8.93-3/4 per bushel, a break above which could lead to a gain to $9.05-1/2.
The resistance is established by the 61.8 percent projection level of an upward wave C from $8.44-1/2. The wave was disrupted by a shallow correction from the Nov. 9 high of $8.88-3/4. The correction is indeed a pullback towards a short falling trendline.
The wave C has resumed, after the contract broke the resistance at $8.84-1/2. Once it travels above $8.93-3/4, it will be highly likely to extend to $9.24-1/2. A more realistic target will be $9.05-1/2.
On the daily chart, the contract has managed to hover above a resistance at $8.82. It is poised to surge towards $9.16-3/4, the 38.2 percent retracement on the downtrend from $10.63-1/4 to $8.26-1/4.
Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.
No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.
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