SINGAPORE: The CBOT soybean November contract may drop to $12.40 per bushel, as it has broken a support at $12.74-3/4.

The contract is riding on a wave c from $14.23, which was disrupted by the support at $12.74-3/4. With the contract having slid below this support again, the wave c seems to have resumed.

This wave is supposed to travel to $11.83-1/2, which still looks distant.

A realistic target could be $12.40 or $12.16. An unexpected bounce from this level, which looks highly unlikely, may be limited to $13.03-1/4.

On the hourly chart, the strong bounce triggered by the support at $12.71 has been reversed. The reversal signals a continuation of the downtrend.

A head-and-shoulders suggests a target of $12.54-3/4. Resistance is at $12.77-1/2, a break above which could lead to a gain to $12.85-1/4.

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