A study on seasonality in Imports of Soyoil. Will prices further fall in India till October 2015?

How soybean oil market is likely to behave in India in near future? What is the current soybean sowing progress? What is the current supply situation of soy oil? What has been remained the pattern of imports in India during a marketing season? What has been the import price behavior during various months of a marketing season? What is the current supply and demand scenario of the world soy oil market? The current study tries to find out the answers of the above questions on the basis of some empirical analysis.

New edible oil marketing season starts every year from November and end in October. There are still 3 months to start of new season.

We would examine how prices are likely to behave till then.

A.     Latest Sowing Progress of Kharif oilseeds crops in India.

As per the latest Indian government estimates, the total sown area under kharif oilseeds as on 31^st July is 148.52 lakh ha. Area coverage is higher by 15.7 lakh ha. under Soybean from the normal sown area as on 31^st July. Soybean is sown at 104.81 lakh ha as compared to 89.10 lakh ha normal sown area.

In the monsoon season, cumulative Rainfall for the country as a whole during the period 1st June to 22nd July, 2015 was 7% lower than Long Period Average (LPA). Rainfall (% departure from LPA) in the four broad geographical divisions of the country during the above period was higher by 6% in North West India and lower by 6% in East & North East India, 13% in Central India and 12% in South Peninsula.

The monsoon deficiency is more in the east MP and Maharashtra regions of India which may create problem to the soybean crop if rains do not cover up during August month.

As of now situation seems under control so far as soybean crop is concerned.

B.    Stock Position at Port and in Pipelines :

As per the statistics released by SEA of India-

• Current stock of edible oils as on 1st July, 2015 at various ports is estimated at 610,000 tons (CPO 300,000 tons, RBD Palmolein 90,000 tons, Degummed Soybean Oil 80,000 tons, Crude Sunflower Oil 125,000 tons and 15,000 tons of Rapeseed (Canola) Oil and about 1,570,000 tons in pipelines.
• India’s monthly requirement is about 16.0 lakh tons against which currently holding stock over 21.80 lakh tons equal to 41 days requirements.

Thus the current stocks are ample to meet the near future demand of the country. The import is likely to improve in this quarter as well as importers would like to take advantage of lower prices.

 C.    Seasonal behavior in Soybean Oil import in India

Table 1 presents the trend in the soydegum (crude soybean oil) import by India during an edible oil marketing season [November to October] for a period of last 5 years.

For the sake of more simplicity and clarity we have divided the 12 months of the whole marketing season in to 4 quarters. The first quarter (Nov-Jan), second (Feb-April), third (May-July) and forth (Aug-Oct).

Observations:

• The soydegum import has remained LOWEST during FIRST QUARTER i.e between November to January during the period under study (last 5 years)
• There is gradual increment in its imports in the subsequent quarters.
• There is no uniformity in the quarter of Highest Import as the pattern has remained different in all the 5 quarters.
• There is general increment in the imports figures on “year on year basis”.
• During 2013-14, a sudden and significant jump in the soybean oil import is seen (79%).

Inference:

This is clear from the above analysis that India imports lowest usually during first quarter of an edible oil marketing season because its own new soybean crops starts coming in the physical market during October month and the arrival pressure is highest during October, November and December. Thus crushing plants get better parity prices from its own soybean rather than imported crude soybean oil.

Thereafter a lot depends up on the local availability of the soybean, oil availability from other substitutes like groundnut oil, cottonseed oil and rice bran oil etc. The scarcity of the substitute oils spark the import of edible oil in the form of other edible oils mostly soybean oil or crude palm oil. This situation varies from year to year. Thus the pattern in the highest import quarter is not uniform in the years under study.

 D.   Import Price Behavior of Soybean Oil in India

Table 2 depicts the trend in the average import prices of the soy degum in various quarters of a marketing season during past 5 years.

Observations:

• The lowest import prices have been seen either in the last quarter or first quarter of the marketing year.
• There is no clear trend in the period of highest prices.
• During year 2010-11 and 2011-12, the import prices showed the increasing import price trend in the subsequent months.
• However from 2012-13 onwards the trend reversal is seen. i.e highest prices are seen the first quarter i.e between Nov to Jan period, later on prices have seen a declining trend in the far months.
• The last quarter of the marketing season i.e. Aug-Oct period has always seen higher prices as compared to the first quarter of the marketing season i.e. Nov-Jan during last 5 years.

Inference:

The soybean oil availability usually remain high during last quarter (Aug-Oct) due to ease in supply from US which is one of the biggest producers and supplier of the soybean oil in the world market.  Also during first quarter the soybean oil supply from the domestic production remain high in India and China.

Thus due to better supply in the world market during last quarter and high domestic availability in the world’s top most importers i.e. China and India during first quarter keeps international soybean oil prices under check. This is the major reason why the prices have made their lows during either last quarter or first quarter of the edible oil marketing season.

Again in the subsequent months, the supply pressure eases in the world market and many other factors come in to play which keep on changing thus no uniform pattern is found in the period of highest months.

E.   Current Demand & Supply Scenario in the World Soybean Oil Market

Table 3 highlights the current soybean oil market dynamics and gives the clear idea about the current and prospective demand and supply condition of the world market. (Data Source: USDA)

Observations:

For the edible oil marketing year 2015-16, the world production and supply of the soybean oil is likely to increase by 4 and 5 percent respectively as compared to 2014-15.

India’s soyoil production and supply is estimated to improve by 24 and 12 percent respectively for 2015-16.

Its consumption is also estimated to increase by around 12% during coming marketing season.

Major soyoil suppliers like Argentina, Brazil and United State are entering the new International edible oil marketing season beginning from October 2015 with significantly high beginning stocks falling in the range of 25, 25 and 19% respectively.

Inference:

On the basis of the above statistics, the supply situation seems quite comfortable in the world market.

Soy Oil Price Outlook for the current Quarter (Aug 15-Oct15) for Indian Market.

On the basis of the above fundamental analysis we will try to reach out at some conclusion regarding further price movement in the Indian soy oil market.

Let us again quickly SUMMARIZE the major points.

1. The sowing progress of kharif oilseeds including soybean in India is quite satisfactory --------- A bearish market sign

2. The current stock position at the Indian ports is also indicating that stocks are enough to meet the current demand. There is no major festive or marriage season demand during August/September months --------- A bearish market sign

3. Imports have remained generally on higher side during last quarters and least during first quarter of the marketing season  --------- A bearish market sign

4. Import prices have remained lowest during last quarter or first quarter during a marketing season --------- A bearish market sign

5. World market supply seems quite comfortable to meet the current and near future demand --------- A bearish market sign

Thus the above analysis indicate that market is likely to correct further during August to October period. The biofuel demand is also low due to weak international crude oil prices which will further put pressure on the soy oil market. The continued strength in the US dollar Index is also likely to pressurize the US commodities prices including soybean and soy oil in the near future resulting in to weak market sentiments. 

Technical Levels of NCDEX Soy oil Market

Soy Oil : NCDEX
Trend	Support 1	Support 2	Resistance 1	Resistance 2
Down	528	496	577	591

----------------------------------------------------

Downtrend intensify in Oilseeds and Edible Oils Markets in India

Today is the first trading day of the current week starting 9 March and Indian oilseeds and edible oil (Soy oil and Crude Palm Oil) trades down both in physical as well as futures market.

On last friday on 6 March in my previous post, I predicted that edible oil market in India may witness steep fall in near future.

Today market has given early signs of it. Soy oil and Palm oil tried to go up but due to lack of physical market support, the market has started coming down.

In the physical market, the soy oil price are down by Rs. 5.60/10 kg in the Indore market which is the benchmark market for soy oil and soybean.

In Indian futures Market, the soybean, mustard seed, cpo and soy oil all are down in the range of .20 to .88% from previous close.

Discouraging oilmeal export data, poor domestic edible oil demand, weak international market sentiments do not allow Indian market to move up.

It seems that more weakness will be seen in near future.

More update will be given in the night near market close. (IST)

Indian Oilmeal Exports Drop Sharply by 43%

For the consecutive third month the oilmeals exports by India has fallen sharply due to slack demand by the Importers.

As per the Press Release by the Solvent Extractors’ Association of India, dated 5 Feb 2015: 

• The Oilmeal export during April.’14 to Feb.,15 is reported at 2,229,993 tons compared to 3,933,664 tons i.e. down by 43%.  [Table 1]

• In Feb., 2015, export of oilmeals is reported at 181,996 tons compared to 307,260 tons in Feb., 2014 i.e. down by 41%.

• Export of soybean meal has greatly reduced in last 11 months. The Association cites the main reason of this drop is the disparity for soybean meal in international market.

• However, the share of rapeseed meal has increased from 820,885 to 1,002,491 tons, while that of ricebran extractions export is more than doubled in last 11 months.

The Press release further mentions that there has been sharp drop in the Average FOB prices of Oilmeals.

The average FOB soybean meal price sharply dropped from US $ 560 in Sept’14 to US$458 in Feb’15.

The Major Importers of Indian Oilmeals are South Korea, Iran and Thailand.

Be Ready for Sharp Movement in Soy oil in Indian Market in near future

With no change in the duty structure in the Union Budget  on edible oils, market will now start following fresh demand and supply fundamentals in Indian market.

International crude oil prices have also shown some improvement in short term.

In India, the central and northern parts which are the major oilseeds producing states, have received widespread rains which may delay the Rabi oilseeds crop arrivals a little bit delay particularly the Mustard seed crop.

With the start of summer season, demand is likely to pick up gradually.

Please note that for the past 7-8 days soy oil market moves in range of 10-12 rupees with no clear direction.

Right now Soy oil April Contract at NCDEX trades at   593.75.

As discussed earlier, there are signs of some improvement in the physical market demand. But there is still some skepticism over long term outlook in the light of amply world edible oil supplies.

This is the very reason why speculators are a little bit quite and waiting for some clear trend to emerge to make their fresh bet.

The chart pattern suggest that in the next couple of days some clarity must come in the market about the medium term.

The downside seems limited from current levels.

On Daily Chart of Soy oil April Contract at NCDEX following technical levels seems valid for next couple of days.

Support = 585  Resistance 1 = 596  Resistance 2 =604.
A closing above 597 will lead the market towards 604.

Soy oil remains volatile ahead of the Union Budget in Indian Market

Weak global cues of soy oil and crude oil keeps Indian market sentiments subdued in physical as well as futures markets.

Physical markets traders however opine that sooner or later prices are bound to improve with the start of summer in north India after Holi Festival.

They seems downside limited in India market.

Union Budget in India is also scheduled next week on 28th Feb.

Oilseeds industry in India is in favor of gradual increase in the import duty on the refined edible oil. This is to be seen what happens in Budget.

Thus market will remain more speculative and will  follow less demand and supply fundamentals. 

A cautious trade is advised amidst high volatility.

NCDEX Soy oil April Contract

Indian Soy oil Futures Market trades 1% up tonigt

As mentioned in the last post, the Indian soy oil futures opened with a positive note in the morning on renewed buying interest in the physical as well as futures market.

Right now  NCDEX Soy oil April Contract trades at 611 level (1% up from previous close).

Overall trend is likely to remain positive today.

India: Soy oil closes up by 1.87% during week ending 14 Feb 2015

Finally Indian soy oil market closed in green amidst improved volumes and positive global cues in soy oil and crude oil.

NCDEX Soy oil April Contract

Weekly Levels: ( 9-14 Feb 2015)
Open = 599.40
Low = 585.10
High = 605.90
Close = 605.90
% weekly change between Open and Close = (605.90-599.40)/599.40 = 1.08%

Thus on weekly basis a gain of 1% was seen in the Indian soy oil futures market.

Technically a BUY signal is almost confirmed by the moving averages. 5 day and 10 day Exponential Moving Averages (EMA) have changed direction towards upside and today's price has given closing well above the 5 and 10 days EMA. The 5 day EMA has crossed from below to 10 days EMA making a golden cross.

Thus, it seems that next week starting from 16th Feb, the market should trade positive. 

On daily basis chart, the SUPPORT AND RESISTANCE ARE GIVEN BELOW

S1 =595    S2= 587    R1 = 612   R2 = 615

Is Soybean going to trade Up or waiting for fresh Fall in World Market? Know the Fundamentals

Is soybean going to trade up in near future ? Do Current Supply and Demand Fundamentals allow any major price rise? or will it continue to trade sideways to weak?

From July 2014 to till date, the soybean prices in the international market  (CBOT Soybean) have fallen by nearly 28%. It is to be seen how much downside is still there. 


Here an analysis is made to know all these factors. 
World Soybean Supply and Demand Fundamentals : 2014-15: 
If we look at the market fundamentals, It appears that no major upside is expected in near future.

The later months of April, May and June will decide the long term trend depending upon the sowing progress in its major growing countries.

Let us have a look at the current supply and demand fundamentals of the World Soybean Market.

The data for Analysis is taken from FAS, USDA.

Top exporting nations and world is estimated to have significant increment in supply as well as ending stocks as compared to major importing nations during 2014-15 vs 2013-14. [Table 1 & Fig. 1]

World Soybean Supply Scenario: 2014-15 vs 2013-14

Bearish Supply Fundamentals [Table 2 & Fig. 2]

1. The Beginning Stocks higher by 16%.

2. Production higher by 11%.

3. Imports higher by 3%.

4. TOTAL SUPPLY HIGHER BY 10%  as compared to 2013-14, & 18% vs 2012-13.

5. Exports higher by only 4%.

6. Crush higher by 6%.

7. Consumption higher by 6%.

8. ENDING STOCKS HIGHER BY 35%. vs 2013-14, and by 56%  higher vs 2012-13.

9. Stock to use ratio (stock/total domestic consumption) has increased indicating that the pace of increment in consumption is slow as compared to addition in stock.

Supply Scenario in 2014-15 for the Major Soybean Exporters

US, Brazil and Argentina are the three major countries accounting for around 88% of the total world's soybean exports.

Comparative changes in Demand and Supply are presented in the Table 3 & Fig. 3 for major exporters and world.

1. Total supply is 12% more in these three top exporters as compared to world where total supply is more by 10%.

2. United State (US) which is the biggest exporter of the soybean has 14% higher supplies as compared to last year.

3. For 2014-15, in US, the production, supplies, and ending stocks are high by  18, 14 and 319 % respectively as compared to 2013-14.

4. On the cummulative basis, the ending stocks of these top three exporters are significantly high by 46% as compared to 2013-14. World ending stocks are up by 35%.

Demand and Supply Scenario in the Top 10 Importing Nations.

[Table 4]

1. China: It's Production, Imports, total Supply, Domestic Consumption and Ending Stocks are estimated to change by 1, 5, 6,7 and -1% respectively during 2014-15 vs 2013-14. All this means that consumption has increased and ending stocks will fall. This will result into increased demand for the 2015-16.

2. European Union: This is the second largest country in term of imports. Due to significant rise in the production (40%), the imports are estimated to reduce by 2%. In the absence of rise in consumption, its ending stocks are estimated to rise significantly by 57%.

3. Imports are estimated to remain low for countries like Japan, Taiwan, Turkey.

All the analysis made here suggest that there seems no major uptrend in soybean in near future.

However, as we stated in the introduction section, that a lot will depend upon the assessment of sown area in the major soybean growing countries in next season particularly in India where sown area is largely dependent upon monsoon rains and a lot of fluctuation in prices might be seen from May onward in prices if there is any disruption in the monsoon progress. 

So in short to medium term, weakness might persists, but to judge the long term movement, we have to wait for two months.

-----------

Suggestions and opinions are welcome.

Sharp Correction expected in soy oil in short term in India

Update: 10.06 PM IST

As described in the previous post, the price fall has deepened in the Indian soy oil market. The fresh weakness in the international crude oil and soy oil prices at Chicago board of Trade (CBOT) has further discouraged the bulls.

The way prices are falling, it seems that very sharp correction is waiting shortly.

---

For more details please see the below mentioned posts on soy oil and WORLD VEGETABLE OILS FUNDAMENTALS FOR 2014-15.

Soy Complex Market Fell in India for the third consecutive day

Indian Soy oil market shows weakness on lacklustre physical market demand. The spot market prices have fallen.

As we stated in our earlier post that soy oil was getting resistance on higher level and buyers were reluctant to make fresh buy at higher levels.

If we look at the global vegetable oils supplies, we find that fundamentals are in favor of bears. (Please check the earlier post : 9 Feb 2015: WORLD VEGETABLE OILS FUNDAMENTALS FOR 2014-15)....

The current market situation suggest that market is unlikely to witness any major upside in near future.

Currently the NCDEX Soy oil Feb contract trades at 613.15 (-1.26%) at 4.39 IST.

World Vegetable Oils Fundamentals for 2014-15

Major Highlights:

In this report, the supply and demand of vegetable oil is assessed for world. The data for analysis were taken from FAS, USDA website. There may remain some variation from source to source, but the broad picture remains more or less same. Thus the results do not vary much.

Below are the major findings of the Analysis.

Ample Supplies:

• The production and supply of Vegetable oils during 2014-15 is quite comfortable as compared to 2013-14 as well as 2012-13 as is evident from the graph shown below.
• The Production during 2014-15 is estimated to increase by around 3.88 with respect to (w.r.t) 2013-14 and 9.73% w.r.t to 2013-14.
• The Total Supply is also estimated to improve by around 4.18 % during 2014-15 vs 2013-14.
• Thus there seems comfortable supply situation of vegetable oil for 2014-15.
• In consumption also there is increment but at the same time, ending stocks are also expected to increase by around 1% as compared to last year.

Further bifurcation of the Total Vegetable oils Supply in to major oils, it is clear that the major increment in the supply is seen in Palm oil (6.1%), Rapeseed oil (6%) and soybean oil (3.2%). However the supply of coconut oil and sunflower oil is expected to shrink during 2014-15.

Please note that Palm oil and soybean oil are the two major vegetable oils jointly accounting for around 71% of the total vegetable oil supplies in the world.

Thus a joint increment in supply of soybean and palm oil reaches near 5.1% for 2014-15 as compared to 2013-14. This seems quite significant increment.

Now let us have a look at Table 3 which shows the soy oil supply scenario in the world, major importers and major producers.

1. India and china are the major importers of soy oil. So far as the India is concerned, it started its marketing season 2014-15 with increased beginning stocks (3% higher), the production also increased by 1%, imports have also seen increment of around 5% till date as compared to 2013-14. However, the domestic consumption is estimated to witness an increment of around 5%, the ending stocks are estimated to decline by around 11%.
2. China’s Soy oil production during 2014-15 is estimated to increase significantly by around 8 %, reducing the depending on imports by around 26%. However the pace of consumption increment remains at 4% as compared to 2013-14. There seems no major change in the ending stocks.
3. All the major producers of soy oil i.e. China, US, Argentina and Brazil started the Marketing Year 2014-14 with significantly low beginning stocks. The major production increment is seen in China and Argentina which helped in improving the world production by 5% resulting an increment of around 3% in total world supply.
4. The domestic soy oil consumption of US is estimated to decline by around 3% during 2014-15 however in others it is estimated to improve.
5. Despite a short fall in the ending stocks of Indian by around 11%, and Argentina by 12%, the US is estimated to be left with huge ending stocks of around 23%. The world will be having 4% higher ending stocks as compared to 2013-14.

Table 4 presents the Palm oil supply and demand scenario of its major importers as well as producers.

1. China and India, the biggest importers of palm oil,  both started Marketing year 2014-15 with significantly down beginning stocks of palm oil (china -41%, India -38%).
2. Thus considerable increment in imports of around 13% is estimated for both of these countries thus improving the supplies by around 9% for 2014-15.
3. The domestic consumption is also estimated to increase by 8 to 10 percent in these countries.
4. One the one hand, china is expected to end this season with improved ending stocks, the India may finish the season with less ending stocks as compared to 2013-14.
5. The Major Producers of Palm oil, i.e. Indonesia and Malaysia both started the year 2014-15 with ample beginning stocks from 9 to 17 percent.
6. The production is also estimated to increase considerably in Indonesia and Malaysia by 8 and 5% respectively during 2014-15 as compared to 2013-14.
7. Total world palm oil supplies are estimated to increase by around 6% resulting in to an increment of around 7% ending stocks at world level.

The supply and demand fundamentals so far has remained in favor of BEARS, however, in coming days a lot will depend up on the MONSOON situation in India. We will have to watch this year's monsoon onset and its further progress. if any deviation from its normal onset appears then Indian edible oil market can see significant upside. 

As of now not much supplies concerns are there.

Soy Oil Prices Consolidates during Week ending 6th Feb 2015 in Indian Market

Bull and Bears remained equally active during first week of February 2015. The week started with a bullish undertone, but after the initial gains for first two days, prices hovered in a narrow range thereafter for most of the time throughout the week and finally closed in Red. However, on weekly basis marginal gains were seen during this week.

NCDEX Soy oil Feb Contract
Weekly Open = 618
Weekly High = 634.95
Weekly Low = 618
Weekly Close = 627.50
Difference between Open & Close = 9.5
%age weekly gains =( 9.5/618) *100 = 1.53%

This indicates that market is getting resistance on current levels and it needs some big news to push market up from current levels.
These gains were mainly seen due to sharp rise in international crude oil prices, and improvement in the CPO prices at BMD, Malaysia.

The next week may prove deciding in finding the direction of the market for medium term.

In India summer season is just starting from March onwards and demand of crude palm oil increases as compared to soy oil.

NCDEX Soy Oil Feb Contract as on 6 Feb 2015

Soy oil market sentiments improve in Indian Market

Today Soy oil market in India traded with a bullish undertone despite the fact that yesterday sharp correction was seen.

In fact, strong international market sentiments i.e soy oil at CBOT and Crude palm oil at BMD, Malaysia added to the bullish undertone of the Indian market.

Firm international crude oil sentiments also supported the market. Despite all these positive factors market was unable to break yesterday’s high price indicating that traders are still in dilemma regarding future movement of the market.

It may take some more time to witness the clear direction of the market. Let us wait for a day or two.

Today NCDEX Soy oil Feb contract closed at 631.30 (1.25 % up from previous close).

Soy oil Market update of Indian Futures Market

As described in the earlier posts, the soy oil market seems unable to sustain on higher levels. After witnessing a price rise for the three consecutive days, today market fell due to lacklustre demand in the physical market.

The earlier rise was mainly due to short covering and support from crude oil. Today crude oil has also seen some profit booking in international market.

In Indian futures market, the NCDEX feb soy oil contract is getting strong resistance near 632 level. Today if market closes below 626 level then market may further witness weakness towards 610 level. [current price level at 9.19 IST is 624.45]

At the same time closing above 632 will make market strong.

Current market condition seems weak.

Soy oil Weekly chart : NCDEX Feb contract

Learn to earn in Long Term Trade in Commodities through Technical Analysis

Commodities Market trading is a little bit difficult as it needs reasonable knowledge of the fundamental factors of demand and supply of the commodity under trade as well as some basic knowledge of the Technical Analysis to decide the entry and exit point.

There are numerous articles and study material freely available about Fundamental and Technical Analysis.

However here we will discuss about some basic concepts of technical analysis which we have found very useful and simple.

We will learn how  to use indicators to make a "DECISION MATRIX TO IDENTIFY A RIGHT TRADE" from a Long Term Trading Perspective. 



Before we start, few points must be noted down.

1. All known information is reflected in the price.
2. Market moves on the basis of expectations and emotions of the Traders i.e (Buyers and sellers). 
3. No Single Technical indicator is right all the time.
4. You too don't have to be right all the time.
5. Practice to learn about few reliable indicators and stick to them.
6. Be consistent and disciplined in your approach. 
7. Most of the money is being made in a TREND, especially as far as futures market is concerned.
8. Patience and discipline is needed as you must wait for clear trend in the market in order to succeed on the long run.
9. As long as the indicators are in neutral territory avoid to trade unless you are a very knowledgeable trader.

Terms used in Technical analysis

What is Technical Analysis

• In simplest words, it is the examination of past price movement to forecast future price movement.
• In Technical analysis, price refers to any combination of open, high, low and close for a given commodity over a specific time frame.
• The time frame can be intraday, daily, weekly or monthly or yearly etc.

Important Types of Technical Charts

Line charts, Bar charts, Japanese Candlesticks chart

Candlesticks Chart Pattern

Line Chart Pattern

Bar Chart Pattern

Market Trend

Up trend, Down trend, Sideways trend

Moving Averages (MA)

ØThese are some of the oldest and most useful indicators.

ØBasically moving averages show TREND.

ØA BUY signal is given when price crosses above the moving average and the MA is directed upward.

ØA SELL signal is given when price drop below the MA and MA is directed downward.

ØBuy or Sell signal is not given when MA changes direction but price does not cross above or below the MA.

ØTHE MOVING AVERAGES SERVES AS SUPPORT AND RESISTANCE.

Types of Moving Averages

ØSimple Moving Average (SMA)

ØExponential Moving Average (EMA)

ØWeighted Moving Average (WMA)

Typically 5 and 10 are used in EMA in most of the agricultural commodities.

Bollinger Bands (BB)

Bollinger Bands are a kind of trading envelope. They are lines plotted at an interval around a moving average.

Period: The period for which to compute the band.(Typically 10 is used in agricultural commodities)

Band Width: The half-width of the band in terms multiples of standard deviation. Typically 2 is used.

Bollinger Bands consist of a moving average and two standard deviations charted as one line above and one line below the moving average. 

USES:

ØTo determine overbought and oversold zones.

ØTo confirm divergences between prices and indicators.

ØTo project price targets.

ØThe wider the bands are, the greater the volatility is.

ØThe narrower the bands are, the lesser the volatility is. 

Volume

ØVolume can be a barometer of future activity and direction.

ØVolume measures the number of contracts that exchanged hands during the trading session.

ØIt measures market activity and liquidity. Higher volumes means higher liquid contract or commodity and vice-versa.

ØVolume is tracked on an individual delivery month and total symbol basis. 

Open Interest (OI)

ØOpen Interest is applicable for futures and commodities charts only.

ØOpen interest shows the total number of futures contracts that have been entered into and not yet liquidated by an offsetting transaction or fulfilled by delivery.

ØWhen both sides are new, open interest increase.

ØWhen only one side is new, open interest remains unchanged.

ØWhen both sides close out, open interest decreases. 

Relative Strength Index (RSI)  ------- (Range : 70-30)

ØIt measures market's strength and weakness.

ØA high RSI, above 70, suggests an overbought or weakening bull market. A low RSI, below 30, implies an oversold market or dying bear market.

ØIt works best when a failure swing occurs between the RSI and market prices. For example, the market makes new highs after a bull market setback, but the RSI fails to exceed its previous highs.

ØWhen price touches the upper BOLLINGER BAND, and RSI is below 70, it is an indicator that trend will continue.

ØWhen Price touches the lower BOLLINGER BAND, and RSI is above 30, down trend will continue.

ØIf a price touches the upper BOLLINGER BAND and RSI is above 70, the trend may reverse and decline.

ØIf a price touches the lower BOLLINGER BAND and RSI is below 30, the trend may reverse and move upward.

Stochastic  (Slow) - (Range : 80-20)

ØIt indicates OVERSOLD & OVERBOUTH market conditions.

ØIn an upward trending market, prices tend to close near their high.

ØIn a downward trending market, prices tend to close near their low.

ØWhen an upward trend matures, prices tend to close further away from their high.

ØWhen a downward trend matures, price tend to close away from their low.

Clusters

ØThe stochastic indicator attempts to determine when price starts to cluster around their low of the day in an up trending market, and cluster around their high in a downtrend. 

Moving Average Convergence/Divergence (MACD)

ØBuy when the oscillator crosses above the slower exponential moving average of the oscillator.

ØConversely, you sell when the oscillator crosses from above to below the exponential moving average of the oscillator.

ØLastly, divergence is possible with the MACD.

ØThe ideal signal would show divergence, clearly break a dominant trend line, and display the crossing of the MACD lines.

How to use the above technical Indicators ---- Learn 

Thus, Exponential Moving Average (EMA), Bollinger Bands (BB), Relative Strength Index, Slow Stochastic and MACD are five major technical tools which we can apply in finding initiation point and exit points. Most of the time you will have a winning trade in long term.