By Jim Wyckoff
   DOW JONES NEWSWIRES


  The downtrend in soybeans continued Tuesday when November soybean futures hit
a fresh three-month low of $12.51 a bushel.

  Chicago Board of Trade prices are in a steep five-week-old downtrend from the
early-July contract high of $16.36 3/4. Serious near-term technical damage has
been inflicted and the bears still have solid downside technical momentum.

  The next downside price objective for the bears is to push and close November
soybeans below psychological support at $12.00 a bushel. Above that level,
solid technical support for November soybeans is located at Tuesday's low of
$12.51,

  For the bulls to begin to regain some upside technical momentum they will
have to push and close prices back above psychological resistance at $13.00.
Above that lies strong technical resistance at $13.50 in November futures.

  Price action the past two weeks has also seen serious chart damage inflicted
from a Fibonacci technical perspective. Prices have dropped below three major
retracement levels (61.8%, 50% and 38.2%) of the price move from the April low
of $10.45 1/4 to the contract high of $16.36 3/4. The soybean bulls would have
to push prices back above the 50% retracement level, located at $13.41, to
regain some Fibonacci-related technical strength.

  The soybean bulls can correctly argue that November futures are now into
technically oversold territory, as  measured by the 14-period Relative Strength
Index. The RSI for November soybeans is presently reading 26.21. Any RSI
reading below 30.00 does suggest a market that is overdone on the downside and
due for at least a corrective bounce very soon.

  The last time the RSI dipped so low on the daily chart for November soybeans
was a reading of 25.45 on March 20. On April 1, the market did put in a low and
work higher into the early July timeframe.

  Seasonality studies show soybean futures prices trending sharply lower from
the August timeframe into the October timeframe.