Soybean oil futures for September (ZLU26) are showing a potential selling opportunity as prices continue to weaken. The daily bar chart indicates a downward trend, with the moving average convergence divergence (MACD) indicator also signaling bearishness as the blue line is below the red line, both trending downward.
Fundamentally, the decline in crude oil prices (CBQ26) (CLQ26) is adding pressure on bean oil prices. Additionally, spreaders who had previously taken long positions in bean oil and short positions in meal (ZMU26) will likely start unwinding those spreads, further impacting bean oil prices.
If September bean oil futures drop below chart support at 65.90 cents, it could trigger a selling opportunity with a downside target of 55.00 cents or lower. A key resistance level to watch is at 70.00 cents, where a protective buy stop could be placed.
It’s important to note that trading futures involves risks and it’s crucial to understand the complexities and volatility of the market. The Commodity Futures Trading Commission (CFTC) emphasizes the importance of assessing your financial situation and risk tolerance before engaging in futures trading.
Disclaimer: The author, Jim Wyckoff, does not hold any positions in the securities mentioned in this article. The information provided is for informational purposes only. This article was originally published on Barchart.com.
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