Next week will definitely be an exciting week. Based on USDA schedule, Crop Progress Report will be released on Tuesday, Oct.9. On Thursday,Oct 11, there will be another three market “movers” released, including Crop Production Report, World Agricultural Supply and Demand Estimate Report and World Agricultural Production Report.①
According to current news, most traders expect higher yields in corn and soybeans②.However, it is said that USDA reports are famous for making surprise.So as I see it,the road ahead is still hard to predict.
At the same time as I write my blog, I notice that the corn and soybeans futures are falling,expecially for soybeans,which means the higher-production expection and good news from Brazil have trumped the news about the reduction in Canadian canola oil③④.And now that the price fall appears after the weekend-market-close, I’d like to take it as the result of rational behaviors. Moreover, from the pyschology side, although the final estimate is still unknown, if traders want to make big money,they have to get some positions before reports released. Thus, I am sure that most speculators who are waiting for the USDA reports have already selected and took their final positions in short, which makes me believe that the downward price trend in corn and soybeans markets will not reverse before any release of the reports. Particularly, to soybeans,I can see from technical aspect that a downward space still exists, for Mar.2013 soybean(S3H) price was once well below 1500 last week already. So there will be no technical barrier against S3H to go down below 1500 again.
Hence,I’ll take following steps:
1.Take 3 short positions in Mar.2013 soybeans(S3H).
2.Keep holding 3 shorts on Dec.2012 corn(C2Z)
Of course, I will keep an eye on the market dynamics.
Reference:
①http://www.usda.gov/wps/portal/usda/usdahome?navid=AGENCY_REPORTS
②http://www.agrimoney.com/news/corn-soy-prices-retreat-on-informa-crop-revisions–5073.html
③http://www.agrimoney.com/news/transport-woes-cloud-rosy-outlook-for-brazil-soy–
④5069.htmlhttp://www.agweb.com/article/canada_canola_output_down_sharply/
and I am still stuck with my longs.. I need to make some moves this week..
you think the reports will drive down the prices? because of Brazil?
I don’t know. As you might already see it,the soybeans market is crazy..But I had pulled out before the price bounce. Good for me !haha