Supply : LaNina pushed planting forward well into the third week of June in the Ohio valley and surrounding states. Normally, August drought is expected, in a LaNina year. This year was different. Timely and adequate rains resulted in a bumper crop. Yields ranging from 40 to 65 bushels per acre are the norm. Definitely no shortage.
Demand : With China having raised their interest rates months ago, the consumers are still feeling the effects of a mild slowdown. No booming demand there. Add that to an uncertain Europe, and the $US index is finding support. Crude oil seems to be range bound. Until crude oil resumes above $100 / barrel, or the government increases blending requirements, there will not be excess demand in soy oil for soydiesel either.
Harvest pressure should be done in a few weeks. Net Commercials are approaching zero. Which is when I would look for a trading range to occur. USDA is set to provide a report in 2 days.
So, I would agree that for now the fundamentals favor continued bearishness.
Sorry for my English, I agree with your point of view, now I come lose from oilseed playing up, now I see a bearish financial outlook uncertain, Europe, Iran, etc, etc, BUT.
Corn, Wheat, with net Comercials very bullish or neutral, that is the question, soybean oil meal, too.
Here in Argentina soybean planting was excellent, with plenty of water, essential for the beginning, I have understood that Brazil is also good, I can not understand the position of the Comercials, I agree with you, but these guys always know a little more than you and me.
It would be nice if someone can give their point of view about this, as to whether the commercial search lowering the risk neutral or actually are bullish.
Net Commercials is the BLUE line in the chart.
if Net Commercials > 0 and rising : look for a bearish trading range
if net Commercials > 0 and falling : look for a bullish trading range
if net Commercials
if net Commercials
If you prefer the COT Index indicator, use a very long time period. Time from one ElNino to another = 3 - 5 years. So if using a COT Index use 144 to 156 weeks minimum as your time base.
Some people wait for a trading range before entering long. The problem is that a market can stay in a trading range for more than a year.
If John Deere farm equipment reports increased tractor and combine orders then the producers are bullish. Potash Corp. sales is another indicator. Increased fertilizer orders indicates producer bullishness.
Cover Short. The harvest pressure has ended. Oil closed today over $100. and it looks like turmoil in the euro / $US is about to get ugly. Although political tensions between China and USA are increasing over the middle east, I am taking a breather. On 11/07/11 Soybeans were trading at $12.10. Price a few minutes ago on Globex was $11.42, for a nice profit of about $3000 per contract.
Beans have a very strong seasonal tendency to bottom around the beginning of October and rise into the new year. This year beans did bounce on schedule but failed after a few weeks. Price has been on a steady decline since mid October.
I've been waiting for a trend change to get long. Counter-trend moves can be severe so I'm in no hurry to anticipate a rally just because seasonals are pointing up. In fact, I looked through the last 20 years of January beans and things don't look good. Historically, when the October low has been decisively taken out in November, any year end rally has been muted. Most have been range bound between the November high and December low. As of today the November high is $1 away, a break of the December 5th pivot high could easily launch us back to the top of the range.
Jan Beans Seasonal Chart
Shay Campbell
Timing Charts, LLC
The trend is your friend until the end, when it bends.
Supply : LaNina pushed planting forward well into the third week of June in the Ohio valley and surrounding states. Normally, August drought is expected, in a LaNina year. This year was different. Timely and adequate rains resulted in a bumper crop. Yields ranging from 40 to 65 bushels per acre are the norm. Definitely no shortage.
Demand : With China having raised their interest rates months ago, the consumers are still feeling the effects of a mild slowdown. No booming demand there. Add that to an uncertain Europe, and the $US index is finding support. Crude oil seems to be range bound. Until crude oil resumes above $100 / barrel, or the government increases blending requirements, there will not be excess demand in soy oil for soydiesel either.
Harvest pressure should be done in a few weeks. Net Commercials are approaching zero. Which is when I would look for a trading range to occur. USDA is set to provide a report in 2 days.
So, I would agree that for now the fundamentals favor continued bearishness.
Sorry for my English, I agree with your point of view, now I come lose from oilseed playing up, now I see a bearish financial outlook uncertain, Europe, Iran, etc, etc, BUT.
Corn, Wheat, with net Comercials very bullish or neutral, that is the question, soybean oil meal, too.
Here in Argentina soybean planting was excellent, with plenty of water, essential for the beginning, I have understood that Brazil is also good, I can not understand the position of the Comercials, I agree with you, but these guys always know a little more than you and me.
It would be nice if someone can give their point of view about this, as to whether the commercial search lowering the risk neutral or actually are bullish.
Net Commercials is the BLUE line in the chart.
if Net Commercials > 0 and rising : look for a bearish trading range
if net Commercials > 0 and falling : look for a bullish trading range
if net Commercials if net Commercials If you prefer the COT Index indicator, use a very long time period. Time from one ElNino to another = 3 - 5 years. So if using a COT Index use 144 to 156 weeks minimum as your time base.
Some people wait for a trading range before entering long. The problem is that a market can stay in a trading range for more than a year.
If John Deere farm equipment reports increased tractor and combine orders then the producers are bullish. Potash Corp. sales is another indicator. Increased fertilizer orders indicates producer bullishness.
Cover Short. The harvest pressure has ended. Oil closed today over $100. and it looks like turmoil in the euro / $US is about to get ugly. Although political tensions between China and USA are increasing over the middle east, I am taking a breather. On 11/07/11 Soybeans were trading at $12.10. Price a few minutes ago on Globex was $11.42, for a nice profit of about $3000 per contract.
InsideFutures.com weekly article titled Futures Files, just sent out an email stating to "Expect a Short Covering Rally in Soybean Complex".
You saw it here first folks. Do you suppose they read TimingCharts.com ?
Beans have a very strong seasonal tendency to bottom around the beginning of October and rise into the new year. This year beans did bounce on schedule but failed after a few weeks. Price has been on a steady decline since mid October.
I've been waiting for a trend change to get long. Counter-trend moves can be severe so I'm in no hurry to anticipate a rally just because seasonals are pointing up. In fact, I looked through the last 20 years of January beans and things don't look good. Historically, when the October low has been decisively taken out in November, any year end rally has been muted. Most have been range bound between the November high and December low. As of today the November high is $1 away, a break of the December 5th pivot high could easily launch us back to the top of the range.
Jan Beans Seasonal Chart
Shay Campbell
Timing Charts, LLC
The trend is your friend until the end, when it bends.
El-Nino : friend or foe ? If you are a producer, El-Nino brings spring drought to Argentina, and reduced expected yields.
Reduced Argentina yields = reduced supply.
Reduced world supply with steady demand = bull market !
And so, the first trading day of 2012 we see a gap up in Chicago.
Yes sir, that break of the Dec 5th pivot high proved to be a nice ride - right to the top of the Nov range!
Shay Campbell
Timing Charts, LLC
The trend is your friend until the end, when it bends.