Week 8( Part 1): What went wrong

Soybean always my attention object in trading game. This week, I still pay my attention on soybean. This week, I get 3 soybean long contracts price in $1515, cause soybean demand is expected bigger than the supply, this is a very significant factor. In addition, drought influenced American soybean harvest. It leads to the shortage supply. Through the technical analysis, I expected soybean price will increase. Therefore, I choose long position.

 

Date in       Contract      Position   Price in      Gain/Loss

2012-11-07     S2X         Long       1515       -3150*3=-9450

Unfortunately, I lost a lot of money. Then I search the Internet and want to know what happened in soybean market. I get some information, The US soybean crop is much larger than expected, thanks to late-season rains that blunted the impact of the worst drought in half a century, and the corn crop also is marginally larger, the government said on Friday (09 November 2012). Another factor is that I choose the November soybean contract, while November contract is going to the end and expected stock appeared different, heavy selling force the price decrease.

 

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