Yahoo Finance Soybeans are Slammed Following New Chinese Trade Tariffs
Grain prices were hammered early on Wednesday following news that China announced new tariffs on 106 US products. Soybeans are one of the products that will receive up to a 25% tariff making them uncompetitive with other global grains. This news followed additional tariffs on Chinese products announced on Tuesday. China announced additional tariffs on 106 U.S. products on Wednesday, in a move likely to heighten global concerns of a trade war between the world’s biggest economies. The effective start date for the new charges was not announced, though China’s Ministry of Commerce said the tariffs are designed to target up to $50 billion of U.S. products annually. The 25 percent levy on U.S. imports includes products such as soybeans, cars and whiskey.
Corn Prices
Corn prices dropped sharply on Wednesday, declining more than 3%, in the wake of the news of a 25% tariff set by Chinese officials on imported soybeans. Prices tested support near an upward sloping trend line that comes in near 372. Resistance is seen near the 10-day moving average at 378. Momentum has flipped and turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses below the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in the red with a downward sloping trajectory which points to lower prices.
Soybean Prices
Soybean prices were hammered and could see a massive supply overhang if they do not have a destination to export to like China. Prices sliced through support near the 50-day moving average at 996. Target support is seen near an upward sloping trend line near 952. Momentum is negative as the MACD histogram is printing in the red with a downsloping trajectory which points to lower prices.
Wheat Prices
Wheat prices are lower early on Wednesday dropping 1.75% and forming a bear flat pattern which is a pause that refreshes lower. Support is seen near the March lows at 441. Resistance is seen near the 10-day moving average at 452 and then the March highs at 506. Momentum has turned negative as the MACD (moving average convergence divergence) index recently generated a crossover sell signal. The MACD histogram is printing in the red with a down sloping trajectory which points to lower prices.
This article was originally posted on FX Empire
