A correction......or are the Bull Markets over for the Grains?
Was today a correction in our grain markets or has the tide changed? Are the great bull markets of 2010-2011 coming to an end or was today just another natural (needed) correction?
As many others have been talking about lately such as http://www.dtn.com/ag/assets/thegatheringstorm.pdf it appears that we may be nearing the end. As I stated in an agweb.com blog I think the time is near to have one foot either ready or already out the exit door.
Here are some of the things that look like they have perhaps started to change lately; indicating to me that things might be changing.
our bull markets do have some holes starting to form in them
1 russia exporting.......what I believe is the biggest change in our fundamentals........and my view is this is more negative the feed grains then quality wheat...............as that is what they are exporting.........
2 outside bearish months/weeks......key reversal seen in many grains and outside markets........like equities........some longer term trends have turned either sideways or down.............. seen the dtn link above for more detials
3 key reversals in many markets..........such as MPLS July today............couple year high followed by a close nearly 80 cents off of that high
4 Wheat in CBOT showing a constand series of lower high's........we hit the down trend perfectly a week or so ago..........now we are back near uptrend line support........will that hold or if it breaks will the selling really hit?
5 Crop conditions increasing in corn..........planting nearly finished.......weather forecasts seem to be changing...............European Rain........some heat units in other parts of the US that need them......95 ish in central south dakota today
6 over all economic situation..........feels like those markets have turned to sell the bounce..........not buy the break.......watching CNBC/Bloomberg....many are talking about risk diversification.......pulling money out perhaps?
7 funds caught wrong..........listing to top third........which is on agweb.com they commented how the funds had added about 50k contracts of corn......and at best they are around even...... and more then likely carrying a loss now
8 stages set for june report to not show the decreased stocks like many expect.........market is geared up for a bullish report looking at average trade estimates..............the report doesn't have to be bullish........last few months haven't been......that trend is perhaps changing
9 seasonal trends - I believe Ed Usset's rule is to not hold corn after July 4th; that is less then a month away
10 History repeats it self............high prices do cure high prices............also anyone notice when we made our lows in the grains??? about a year ago.........June 29th..........when where many of the 2008 highs made? June 29th for corn....... could we see an economic meltdown like we did in 08? has the past couple years simply been a false correction in the big world picture? Are things really better today then they where back then?.............
bottom line is all of the above is probably debatable........but i think for marketing and risk management purpose one foot should already be out the exit door............ or at the very least ready to make small PROFITABLE sales..........with little notice
As many others have been talking about lately such as http://www.dtn.com/ag/assets/thegatheringstorm.pdf it appears that we may be nearing the end. As I stated in an agweb.com blog I think the time is near to have one foot either ready or already out the exit door.
Here are some of the things that look like they have perhaps started to change lately; indicating to me that things might be changing.
our bull markets do have some holes starting to form in them
1 russia exporting.......what I believe is the biggest change in our fundamentals........and my view is this is more negative the feed grains then quality wheat...............as that is what they are exporting.........
2 outside bearish months/weeks......key reversal seen in many grains and outside markets........like equities........some longer term trends have turned either sideways or down.............. seen the dtn link above for more detials
3 key reversals in many markets..........such as MPLS July today............couple year high followed by a close nearly 80 cents off of that high
4 Wheat in CBOT showing a constand series of lower high's........we hit the down trend perfectly a week or so ago..........now we are back near uptrend line support........will that hold or if it breaks will the selling really hit?
5 Crop conditions increasing in corn..........planting nearly finished.......weather forecasts seem to be changing...............European Rain........some heat units in other parts of the US that need them......95 ish in central south dakota today
6 over all economic situation..........feels like those markets have turned to sell the bounce..........not buy the break.......watching CNBC/Bloomberg....many are talking about risk diversification.......pulling money out perhaps?
7 funds caught wrong..........listing to top third........which is on agweb.com they commented how the funds had added about 50k contracts of corn......and at best they are around even...... and more then likely carrying a loss now
8 stages set for june report to not show the decreased stocks like many expect.........market is geared up for a bullish report looking at average trade estimates..............the report doesn't have to be bullish........last few months haven't been......that trend is perhaps changing
9 seasonal trends - I believe Ed Usset's rule is to not hold corn after July 4th; that is less then a month away
10 History repeats it self............high prices do cure high prices............also anyone notice when we made our lows in the grains??? about a year ago.........June 29th..........when where many of the 2008 highs made? June 29th for corn....... could we see an economic meltdown like we did in 08? has the past couple years simply been a false correction in the big world picture? Are things really better today then they where back then?.............
bottom line is all of the above is probably debatable........but i think for marketing and risk management purpose one foot should already be out the exit door............ or at the very least ready to make small PROFITABLE sales..........with little notice