June 29, 2010

One day does not make a move, but today’s 1.01 cent lower close in Soybean Oil was its lowest close in almost 9 months…

I certainly don’t know if this is the beginning of the big, sharp downside move I have been anticipating but I do know the markets have a way of suddenly deciding to really go somewhere when you least expect it…and after what has been 21 MONTHS SIDEWAYS, I’m sure the masses are NOT looking for a basically straight down 10+ cent decline in Soybean Oil…But I am…

One of my self-determined wall reminders is: The Best Way Is Going WITH It …In other words, stay away from picking tops and bottoms (of which I am definitely guilty at times), and let the market show you which way it “wants” to go…After all, what you’re really trying to do as a trader is be on the market when it is going somewhere…and today’s fairly large pop into new lows is, simply put, about as good an indicator as you’ll ever get…Doesn’t mean it won’t turn around, but believe me, going with new 9 month lows IS going with the percentages...

Beyond that, there’s a time to sit and there’s a time to add…and if you have any inclination to get on this, or get more of it, I think exactly now is when you do it…

Again, this market has been going NOWHERE (forever!), but even within that framework, there have been multiple 6-10 cent swings…so I maintain that when this market IS moving, a 10-15 cent collapse IS absolutely a major possibility.

The USDA’s first report estimating this year’s Soybean crop will be released at 8:30 EST…The markets reopen at 10:30 and I intend to be selling more when they do…

Here’s today’s chart and one put option I think has major potential…

And here is a probably worthless observation…July 2010 Corn made new contract  lows today at $3.26 a bushel. July 2010 Soybeans closed at $9.47…For those of you that understand anything about row crops, does it not seem significant that Soybeans are now trading at almost TRIPLE the price of corn? Sure seems like one more bearish factor for the soybean complex to me…

Give me a call if you’re interested…Please pass this along to anyone else who might be…?

Thanks,

Bill

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