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SOYB: The Market Becomes Extremely Bullish

SOYB: The Market Becomes Extremely Bullish

Source: Goodfon

Instrument

The Teucrium Soybean Fund (NYSEARCA:SOYB) provides investors unleveraged direct exposure to soybeans without the need for a futures account. Therefore, the decision to invest in this fund should be made after analyzing the soybean market.

Seasonality

At the moment, the soybean futures price is already well above its five-year range. Technically, this could indicate an overbought condition. On the other hand, it could be a sign of an extremely bullish market.

U.S. Export

Excellent exports continue to provide strong market support. As of the first week of October, the accumulated volume of exported soybean together with the outstanding sales (sold, but not shipped) in the US amounted to 40.72 million tons or 68% of the current USDA forecast.

Of course, the biggest buyer is China:

Source: apps.fas.usda.gov

WASDE Report

The latest WASDE report was again positive for the soybean market. The forecast for global consumption was increased by 1.52 million tons, and the production forecast was reduced by 1.27 million tons. As a result, the forecasted deficit of this market was increased to 2.12 million tons:

For the United States, the USDA has lowered its forecast for soybean acreage for the current season:

Source: USDA

As a result, the production forecast was lowered, and the expected surplus was reduced to 53.12 million tons. At the same time, the USDA forecasts that the US will export 59.87 million tons of soybeans this season. Thus, a significant decline in US soybean stocks is expected.

Fundamental Price

In the soybean market, as a commodity market, the price is formed on the basis of the balance between supply and demand. One of the key markers of this balance is the stock-to-use ratio. Therefore, in the long run, there is the relationship between the values of the stock-to-use ratio and the average

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Stock market outlook switches to bullish as S&P 500 breaks through a barrier

Stock market outlook switches to bullish as S&P 500 breaks through a barrier

LAWRENCE G. MCMILLAN



a group of cattle standing on top of a grass covered field


© AFP via Getty Images


It appeared Sept. 23 that the bears had control of the stock market.

But they fumbled it badly.

Beginning with a modest oversold rally Sept. 24, the broader market has staged a strong advance — backed by some of the widest breadth in a while. Now the S&P 500 Index (SPX) has broken out over what had been resistance around 3,425-3,430 points. That has changed the S&P 500’s chart’s designation to “bullish” (in my opinion), and the next target is the all-time highs at 3,588. A reversal back below 3,400 could alter this bullish outlook, but that doesn’t appear likely.



chart


Equity-only put-call ratios have rolled over, and so to the naked eye, this cancels out their recent sell signals. However, they are still on “sell,” according to the computer-analysis programs that we employ. The computer is using a statistical average, and by that measurement, there are still some very low numbers coming off the 21-day moving average.

There are even lower numbers coming on right now, as call buying has been huge over the past week or so. The problem is, we are not getting “average” readings, and until we do, the sell signals should be held in abeyance.

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The stock market won’t see the bullish outcome it’s expecting from a Biden win unless there’s a full blue wave, a JPMorgan stock strategist says

The stock market won’t see the bullish outcome it’s expecting from a Biden win unless there’s a full blue wave, a JPMorgan stock strategist says

NYSE Trader
Traders look on after trading was halted on the floor of the New York Stock Exchange (NYSE) in New York, U.S., March 18, 2020


  • JPMorgan Private Bank’s Monica DiCenso told Bloomberg on Friday that the stock market won’t see the bullish outcome it’s expecting from a Biden win unless there’s a blue wave victory. 
  • The head of US equity strategy said that it will be difficult for Biden to pass a large stimulus bill without Democratic control of the Senate. 
  • The stimulus would also offset higher corporate taxes that are likely under a Democratic administration, she said. 

JPMorgan Private Bank’s head of US equity strategy told Bloomberg on Friday that the stock market won’t see the bullish outcome it’s expecting from a Joe Biden victory unless there’s a full blue wave outcome.

“It does appear increasingly likely that we see a blue wave and I think that is what the market is pricing in right now when you see equities continue to move,” Monica DiCenso said.

The strategist explained that it will be much harder for Biden to pass a large stimulus bill without Democratic control of the Senate, and said: “I really do think you probably need the blue wave for the real bullish outcome that many people are talking about to come to fruition.” 

DiCenso added that the stimulus, combined with continued low interest rates, will be the “perfect backdrop for equities over the near to intermediate term.”

While some investors are nervous that a blue wave will be negative for stocks because Biden’s corporate tax hikes will crush company earnings, DiCenso said the stimulus spending will offset higher taxes.

Read more: Fund manager Brandon Nelson is tripling his benchmark in 2020 with ‘less-discovered’ companies that become big winners. Here are 3 themes and

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A Wall Street strategy chief says the market is flashing bullish signals as more stocks start to rally

A Wall Street strategy chief says the market is flashing bullish signals as more stocks start to rally



a man wearing a suit and tie: CNBC TV


© CNBC TV
CNBC TV

  • Miller Tabak’s chief market strategist told CNBC on Friday the stock market is signaling it has upside potential before Election Day. 
  • Matt Maley cited the outperformance of the Russell 2000 index and said small-cap stocks and chip stocks have room to grow. 
  • He’s less optimistic about the market in the long term, however. A second wave of the coronavirus and an expensive market could be bearish after the election, he said. 

Matt Maley of Miller Tabak  told CNBC on Friday that the stock market is signaling it has upside potential before Election Day.

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The chief market strategist said he is watching the recent outperformance of small-cap stocks. As of Thursday, the Russell 2000 small-cap index was up almost 6% week-to-date, compared to a roughly 3% gain in the S&P 500. The broadening out of the stock market rally, which was previously dominated by mega-cap tech names, is bullish, he said. 

Chip stocks have also been a leading indicator for the market recently, he said. If they rally further, it will be bullish for the market at least until Election Day, the added. 

Institutional investor strategy based on the time of year could also push the market higher, he said.

“We’re in the fourth quarter of the year — institutional investors, if the market keeps rallying, no matter what they think of the long-term value of the marketplace, they have to be in the market and that could push things higher,” Maley said. 

He added that small-cap stocks and chip stocks are enticing right now. Investors can begin to rotate some of their holdings in large technology stocks, which may be a slightly overbought, into chip stocks and cloud computing stocks. “We have a long way to go” in those smaller technology names, Maley

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A 100-year-old stock indicator just flashed a bullish signal suggesting further market upside

A 100-year-old stock indicator just flashed a bullish signal suggesting further market upside

A trader works on the floor at the New York Stock Exchange (NYSE) in New York, U.S., March 4, 2020. REUTERS/Brendan McDermid
  • The Dow theory — a financial theory named after the father of technical analysis, Charles Dow — just flashed a bullish signal suggesting more upside ahead for the broader stock market.
  • The theory is based on the relative price action of the Dow Jones industrial average and the Dow Jones transportation average, as traders look for a move in one to be confirmed by a move in the other.
  • On Wednesday, the Dow Jones transportation average closed at a record high. The theory would suggest that the Dow Jones industrial average will soon follow.
  • Visit Business Insider’s homepage for more stories.

Following the death of Charles Dow in 1902, hundreds of his editorials published in The Wall Street Journal (which he founded) were compiled and expanded on, giving rise to “Dow theory.”

Coined by S. A. Nelson and refined by William Hamilton and Robert Rhea, Dow theory is the study of the intermarket relationship between the Dow Jones industrial average and the Dow Jones rail average, now called the transportation average.

The general idea is that both averages, over time, should move in tandem, given that the transportation average represents companies responsible for the movement of goods across the country. For that reason, it should serve as a leading indicator.

Read more: Self-taught market wizard Richard Dennis took a $1600 loan and turned it into an estimated $200 million. He shares the 13 trading rules that turned his performance parabolic.

Put differently, both depend on each other: If the economy is thriving, transportation companies should also be thriving, as they are tasked with literally moving the economy.

Technical analysts look to Dow theory to confirm broad movements in the stock market. Specifically, traders look for confirmations and divergences between the two indexes.

A confirmation is when the transportation

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