There Is a Buying Opportunity in July Soybean Meal Futures. Here Are the Price Levels to Watch.

July soybean meal (ZMN25) futures present a buying opportunity on fresh price strength. 

I am usually a trend trader but I do make a few exceptions, and this is one. You can see on the daily bar chart for July soybean meal futures that prices are near recent lows, which are also longer-term technical support levels. 

It’s my bias that soybean meal futures do not have much downside from current price levels and that prices will rebound soon. Part of the reason I’m friendly toward meal prices at present levels is that many commercial end-users are likely looking at soybean meal as a value-buying opportunity, based upon historical soybean meal price trends. 

Also, the soybean (ZSN25) futures market has shown some resilience lately, at the same time that the meal futures market has exhibited more significant price weakness. That’s a clue soybean traders also sense there is not a lot of downside at present price levels. It’s also my bias that the escalating tariff situation, which has been bearish for the grain market, has been mostly factored into grain futures prices. In situations like this, traders generally factor into prices worst-case scenarios that most times do not come to fruition. 

Finally, you can see at the bottom of the chart that the moving averate convergence divergence (MACD) indicator is in a bullish posture at present, as both lines are trending higher. A move in July soybean meal futures above chart resistance at $310.00 would give the bulls some better confidence that a market bottom is in place and it would also become a buying opportunity. The upside price objective would be $345.00 or above. 

Technical support, for which to place a protective sell stop just below, is located at the recent low of $296.20.

IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any trades and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.

Here is what the Commodity Futures Trading Commission (CFTC) has said about futures trading (and I agree 100%): 

Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.