OK,
Once again pretty good ranges, and all the grains are higher at this point, along with the soy meal and oil.
Apparently… The fact that the markets did not open sharply lower most likely left a lot of fresh shorts from Friday afternoon in a position where they would cover.
Nov beans have seen a range from 928 to 37, and are currently 7 cents higher..Dec wheat had a range of 451 to 462, and are currently three higher at 452 3/4…Corn also had a range between 340 and 334, and is currently 2 higher…. Sharply higher opens look to have triggered stops… and then the markets seem to have backed off.
If a trader had gone home short Friday DEC wheat at 450, a 12 cent smack, or roughly 600 dollar loss on every one lot is enough to generally make people puke their shorts. My thought is there were some stops hit, and due to the general lack of liquidity which characterized electronic grain trade, a ten cent bump is what you end up with, and then miraculously, 2 minutes later, the market is not 13 cents higher, at 462 but back at 453.. That’s price discovery via electronic trading platforms. With computer programs that show thousand lots offered, but then instantaneously pull the order if a one lot trades at that price, combined with icebergs, which disguise large orders as a series of 2 and 5 lots, its difficult to place any credence on minute to minute prices in these markets. I believe the ten to fifteen minute charts, are the best way to look at these markets with out screaming at the screen. ON a minute to minute basis, there is so much garbage on the screen, the size of the bids and offers, in my opinion, is meaningless. totally…
The only thing that matters is price, and price smoothed out over ten to thirty minutes.
That’s just my opinion..
Stock indexes are slightly lower at this point, with not a lot of activity as of yet tonight. Metals are slightly higher with gold up about 4 bucks and silver slightly higher. The US dollar is currently slightly lower against the euro, at about 11 tics..
As for the beans, I think the 33 to 34 level is a potential buy, with a reasonable stop below to protect against a flush… It will be interesting to see how this market gets pushed around in another 5 or 6 hours when Asia starts rocking on a fresh Monday as we begin the last week in the month. as well as the last week in the quarter… Given that dynamic, we could see an increase in trade able volume, vs. the usual chop fest of head fakes and worm programs which just push around markets looking for stops to set off and pick off…
Crude oil is slightly higher, most likely due to the weaker dollar.. crude is currently up 11 tics..
Grains across the board are firm. Be careful trying to be a hero on the short side…my opinion is to be cautiously bullish, with trailing sell stops to protect against severe losses.