markets before usda report
The strength in corn is giving some credibility to the argument of the bulls that corn has a long way to go on the upside should ending stocks be lower than expected or if weather turns hot and dry during the key July time window for pollination. The market managed to break out of that 2.48-2.52 trading window, which tells me that those people buying into the report saw the breakout as an indicator for the possible bullish knee-jerk reaction on Friday.On the flipside (there's always a flipside, isn't there?!), they may fall on their face buying into the report. I haven't ever been one to initiate a position in anticipation of a report that no one has a clue about; however, I have added to an existing position that had already accrued profits. Those who bought through the night (and a lot of traders did) may be in for a really nice 10-15c gain today, but if forecasts are relatively benign going into July and the report doesn't contain estimates that deviate too far from the average trade guess then Friday's action could amount to very little. Only time will tell. In the meantime, I'm always watching for an opportunity to snatch some out-of-the-money options should a market start to feel overextended.
posted by jared @ 4:09 AM
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