We had been noticing for the past week how open interest was increasing
rather dramatically in both corn and soybean futures. The COT data had
confirmed that funds were holding a large net short position in soybean
futures. It was fund buying that finally drove soybean prices over 35
cents higher on Tuesday, February 3
rd. It appears that fund
buying, in tandem with a sharp rise in crude oil, copper, corn and wheat
finally exhausted the sell paper resting above the market, resulting in
a sharp one-day rally. If the rally continues a couple more sessions,
we'll be interested in selling the May soybean contract and/or
establishing bearish option strategies. In addition, for our
producer/hedger clients, we'll be looking at adding to our short
November 2015 hedges.
(more)
Please share this article
No comments:
Post a Comment