Dow futures can’t get above 13,200 or below 12,650. 600 point trading range looks like our lot for the foreseeable future. I can’t really see any thing on the horizon which will move us. More that likely it will be something coming unexpectedly out of Europe.
The old adage sell in may and go away may once again play out. However, I read a couple articles to that effect on the wire over the past week, so that is suggestive to me that we will stay more in a trading range rather than see an acceleration below 12,500.
The media will continue to have a field day with gratuitous oohing and ahing when ever we have a move over 100 pts. Seems no one on TV understands percentages. A 100 point move with the Dow at 13,000 is .76%, A 100 point move back down when we were at the 08 lows at 6500 was 1.5% and hence much more significant.
I’d be a seller of rallies and a buyer of dips. If 12.650 doesn’t hold, I’d sell it and step aside.
As for the grains, we continue to hear stories of sales to China. So where’s the big bounce? Funds are hugely long soymeal, hugely long beans, and hugely short wheat… Logic would suggest that with China buying corn, we should have been able to get corn out of its trading range to the upside.
Bottom line, we have not been able to sustain a rally or break out above established upper resistance in corn. In old crop, CN that would be 6.75 to 6.84. Today we are trading right at 6.04, after having recently tested recent 1 year lows. CK may corn, spot month, is at 6.14. 6.00 just held, but we should really be at 675 if China is for real… What is missing? Where is the dis connect?
I can’t figure it out. It makes me wonder what is really going on in the Corn market. When the market gets super bullish moves and sits in quick sand, that usually is a sign of some underlying weakness that is not readily visible to traders or commercials.
I have corn calls on, looking for a bounce, don’t get me wrong, but I am disappointed that we are not 50 cents higher. Last Friday we got the news about China buying, yet there is no follow through…
I’m bullish, but wondering when we will light this candle.
CER