Lower soybeans crops are expected in Argentina
Grain futures are rising in price after the quarterly grains report from USDA came out. For soybean oil meal it is another positive. Will it support its prices?

In the end of last week USDA reported the soybeans stockpiles amounted in US to 197bn bushels as of September 1 which is below the expected 201bn bushels. Brazil reported on Monday that soy exports fell this September to 1.443mln tonnes from 3.816mln tonnes in August and from 3.705mln tonnes in September 2015. Argentinean farmers increased the sowings of corn and wheat at the expense of soy in 2016/17 agricultural season, according to the recent report from Buenos Aires grains exchange. For this reason, soybeans crops are expected to fall to 53mln tonnes from 56mln tonnes in previous season. According to forecasts, soybeans planting acreage may fall to 19.6mln hectares from 20.1mln hectares. Moreover, crops may suffer in case of El Nino effects next spring. We consider studying the option to go long in soybean oil meal. It is the residue from the production of soybean oil used chiefly in animal feeds. Argentina accounts for almost 40% of world soybean oil meal. In recent 2 days the soy prices fell as USDA revised the forecast of its yield in US up to 52.5 bushels an acre from previously expected 50.1 bushels an acre.

Soybm

On the daily chart Soybm: D1 is near the resistance of the downtrend. It has not yet managed to surpass it. Price growth is possible if soybeans crops rise in US less than its production shall contact in South America.

Parabolic indicator is giving bullish signals.
Bollinger bands have narrowed which means lower volatility. They are slightly tilted upwards.
RSI is below 50 having formed positive divergence.
MACD is giving bullish signals.

The bullish momentum may develop in case the soy oil meal breaks up through the downtrend line and surpasses the two last fractal highs, Bollinger band and 200-day moving average at 321. This level may serve the point of entry. The initial stop-loss may be placed below the Parabolic signal and the two last fractal lows at 294. Having opened the pending order we shall move the stop to the next fractal low following the Parabolic and Bollinger signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. The most risk-averse traders may switch to the 4-hour chart after the trade and place there a stop-loss moving it in the direction of the trade. If the price meets the stop-loss level at 294 without reaching the order at 321, we recommend cancelling the position: the market sustains internal changes which were not taken into account.
Technical analysis summary

Position Buy
Buy stop above 321
Stop loss below 294