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Shorts take profit on soybeans at month's end
-- DOW JONES quotes PFGBEST Research

Jan. 28

CHICAGO (Dow Jones)--Chicago Board of Trade soybean futures finished stronger Thursday in a bounce from recent losses and on profit taking by shorts ahead of the end of the month.

March soybeans ended up 2 3/4 cents, or 0.3%, at $9.31 3/4 a bushel. The contract bounced after closing Wednesday at its lowest price since Oct. 7.

The market was due for a rebound after sinking since the beginning of the year, analysts said. CBOT March soybeans are down $1.16 3/4 so far this month and have lost 78 3/4 cents since the U.S. Department of Agriculture issued a crop report Jan. 12 that raised the forecast for U.S. soy production.

"It makes sense, today and tomorrow, to take profits out of the market," said Tim Hannagan, analyst for PFGBest.

CBOT March soybeans bounced after hitting a session low of $9.21, near a technical support level at $9.20, Hannagan said. Commodity funds bought an estimated 3,000 contracts.

Soybeans will likely see more short covering Friday, although the market could trade up or down, Hannagan said. The market is still in a seasonal downtrend, he said.

"Everybody's still in the mindset that you have to sell rallies until further notice," Hannagan said.

Expectations for a large crop in South America remain fundamentally bearish for the soy complex, traders said. China, which has been an aggressive buyer of U.S. soybeans, is expected to shift its purchases to South America from the U.S.

The USDA reported total weekly U.S. soybean export sales of 857,100 tons, including 673,500 tons for the 2009-10 marketing year. That was within trade expectations of 700,000 to 900,000 tons.