Record Corn Crop Teaches specs a lesson

The word was out that the index funds were coming for the corn and beans at the first of the year. The only problem with that scenario was a little item called the ending 2009 crop report. The American farmer, even with vomitoxin, and 1/2 BB bushels unharvested under the snow produced a record 13.1BB crop. The speculators who came in long were screaming “Where’s Beeks” today, as March Corn fell the limit of 30 cents shortly after the opening and stayed locke limit all day, finally ending the day with over 90,000 in the offer pool. CH already opened up tonight as of this […]

What levels will suck in new longs to the stock indexes?

Will 11000 in the Dow be enough to convince late blooming bulls that they see a red blanket waving in front of their eyes? Will it be 1200 in the S&P500 which sends all the swimmers back into the ocean after the Jaws scare?

It certainly seems like we have to test some major psychological resistance areas like those, especially Dow 11000. We might need a cover on Time Magazine of President Obama riding a bucking bull from his presidential low at 6446 to 11000. All in all it just feels like the whole nation is ‘hanging fire’ waiting to see what happens next.

For […]

Is this the first “real ” week of Jan 2010?

Well, this week, I can’t imagine any fund managers or big traders still sitting in the cayman islands, counting their money and sipping 30 year old scotch. My guess is that this will be the first “real” volume for 2010. Basically for the last 7 weeks, the volume has been a joke. We had the “almost” meltdown Thanksgiving day eve, with the bank of Dubai mess. Since then, almost every move has been suspect. The bottom line is that a lot of traders were gone.

Here we go, however, for the second business week of 2010. I suggest strapping on your 9 point safety harness […]

15 month high settle in the crude

Wow, a 15 month high settlement in the crude. Ditto for the stock indexes. Dollar can’t pop above 78 and moves lower again. Once again, the popular opinion is punished, lol.

Several weeks ago we were looking at the dollar index looking like it wanted to retrace a chunk of its 9 month down move. Now its looking like a sick puppy which can’t get above the 78 resistance level. On the daily charts, 78 is starting to look like the Great Wall of China, (pun intended)… Each time we test and fail to breach that 78 level significantly builds on itself. IF and when […]

All eyes are on US unemployment Friday Morning 730CST

Tomorrow we will find out the December un-enjoyment figures. While any one’s guess is as good as the next economist’s projection, the key will be the 10 percent figure. If it comes out at 9.9 percent, the cheerleaders will be dancing in front of their respective tv cameras. IF it comes out at 10.1 percent, there will be weeping and gnashing of teeth once again. Not much of a choice either way. However, my advice is to let the smoke clear before putting on a trade.

Barring that, I would suggest at sell order in the Dow futures about 100 to 150 points resting above […]

Final note about Jan beans

I Just wanted to put in a final quote for Jan beans. Tomorrow I will switch to March.
Very simply, SF had a low just 2 weeks ago at 985. We rallied to Monday’s Jan 4th high at 1065. The funds are either already done, or hanging back trying to get better prices to put on their package. Bottom line, we opened Monday higher, made our high for the move so far. We waited Tuesday and Wednesday. When no buying showed up, the market took a powder and broke sharply. How much of a break… Surprise>>> 50 percent of the recent 80 cent move. Once […]

Where are the Funds?

So far grain traders have been waiting in vain for the funds to strap on their buying shoes and get busy in 2010. Perhaps its true that a lot of the fund managers are still enjoying skiing vacations in Switzerland, Aspen or where ever it is those types vacation.
All in all its been a surprisingly low volume beginning to the year. The lone exception has been in the wheat and today in the crude oil.

March wheat is looking to be the strong horse so far in the grains, which is ironic, because it has the weakest fundamental picture, with steady demand and a […]

Gold, Silver, Crude Oil, and the Stock Indexes welcome 2010 with cries of buy, buy, buy

With the Dollar Index taking it on the chin, and 78 looking more like resistance than just a stepping stone on the way to higher correction, the market picture looks cloudy once again.
Those looking for a clear answer to what the future holds can only be guaranteed 3 things, 1) risk, 2) volatility and 3) 20/20 hindsight. That being said we entered into 2010 with a bang. The stock indexes made fresh 15 month highs, while crude oil and the metals beat the bullish drum and rallied higher. Feb crude oil is flirting with its old October highs, possibly staging a charge for the […]

Grains looks Strong as we await more fund rebalancing

Pent up buying hit across the grains today. I hope for the sake of the bulls that this wasn’t the whole wad of business from the funds. If it is, this January could look suspiciously like Jan 09,when we made our highs early in January and then hit the skids for the rest of the first quarter. Does any one else remember that action last year? Just a caveat that while the charts look like they are basing, and perhaps are even starting to turn bullish on an intermediate term, anything can happen. The fact remains that the funds are the tail that wags the […]

Thoughts for Bullish Options in Grains for 2010

The Perfect Bullish Storm in the Grains for 2010?

From my first day on the floor of the CBOT in 1992, the phrase I heard the most from veteran traders was, “All I want is a drought and beans in the teens.” Much like the lament of every die hard Chicago Cubs fan hoping that this year will be the year the Cubs finally win the World Series, every grain trader who experienced the 1988 drought year longed for another.

As we look to possible scenarios for the grains in 2010, in addition to the usual hope for a drought, we have at least four […]