Well,since the USDA stock report had been released this week,there will not be another “bomb” from USDA next week. So, technically,the commodity futures market next week should be less volatile.
My intuition tells me the downward market trend will continue, because the low stock level not only reflects the current high demand but also indicates that stockholders lack confidence in next-year’s price .Besides,I don’t believe traders’ previous expectation will switch such easily in such a short time zone. Aslo,I expect good news from Latin America. So, my conclusion is that the prices of Corn and Soybeans will go down in general before any new USDA report is released.
Based on my analysis,I’ll take steps below:
1. Keep holding short on Mar.2013 Soybeans(S3H).
2.Take another four short positions on Mar.2013 Soybeans(S3H)
3. Take five short positions on Dec.2012 Corn(C2Z)
I am looking forward to sitting on the top of the hill stacked by money!
Hello Mike!
Nice blog entry. I like how you have clearly detailed your strategy for the upcoming weeks. You seem to be taking numerous contracts, which indicated that you must be very confident with your predictions. I am particularly interests in knowing how you account for the price volatility in the trading week. This week we saw a lot of volatility in prices and which you also alluded to in your blog entry. Do you pull out often during the week or do you stay in for the whole week? I have been pulling out and plunging in to trading contracts on daily basis and just wanted to know how you go about it.
Secondly, it was interesting to see that you have been following market news and updates from Latin America. It would be great if you could share the article/news that you are expecting from that region. Lastly, you have drawn the conclusion that the demand is relatively higher in the current period. However, from my research I have come to the conclusion that the demand is relatively stable due to incoming harvest and would perhaps stay like this for a while. Please comment on the source of information that you consulted to deduce the consumer demand period in the current period. It may help me in gaining some profits next week. All in all, a nice read!
Hey Ahmed!
Thanks for your comments! I have my answers below to your questions.
1. Do I pull out and plug in the market offen during the week?
No,I don’t. All I did in last two weeks was submitting orders on Sunday or Monday, then leaving them staying in the market for the whole week. I did this way not because of my confidence, but because of my lack of time searching for new information. Moreover, I had known little about Futures trading system before startiong this game, which made me want to spend some time getting familar with it before making frequent transations. I dencide to make more transations from this week, as you will see from my third week trading blog.
2. Where did I aquire the market news about Latin America?
http://www.agweb.com/article/soybean_price_declines_could_continue_for_awhile/
I’ll make sure to put all reference on my post from this week.
3.Why do I say current demand for corn is high?
I think the lower-than-expected stockpile had already reflected the high demand. We could not have this low-stock situation unless there was a high demand in last few weeks.So this low-stock-level told us that despite the incoming harvest, the high demand,like whick from livestock industry, caused by the severe US drought still exists at this time.
That’s it! Just my personal opinions.Welcome further comments!
Hope you make a good profit this week!
I admire your courage backed by your intuition. Although I took the opposite position in the corn and soybeans contracts , I look forward to hearing your good news ” sitting on the top of the hill stacked by money”! 😉
Wow….That’s different from my thought…I would think the price would go up next week but downward trend in LR….
Thus I offset my short..><
Things change~haha
Good job on explaining your strategy. I enjoyed reading and look forward to see the next result!
Thanks for your comment! Happy Thanksgiving~