Think your stop was just a bit too tight here as it closed at 1480 and still could make a move to 1525-1535 on the daily, however, 1.5 is probably a magnet price and there's plenty of other traders potentially selling this area on technicals. Weekly still looks like a downtrending range to me though. You could always to see if it breaks 1600 and then get long from there but until this thing shows signs of breaking out of this range you're fighting a an uphill battle. Let it confirm.
Actually, the inter and intra market dynamics are more powerful than everything affecting absolute prices except perhaps news( industry sensitive policy news ). That's my view. I don't doubt it is possible to trade profitably without it though. To each his own. Special announcement : I read a bunch of stuff, including FAO-AMIS, IGC and all those reports from pointless government bodies, and from now on and into spring I am inclined to short most forward curves. Trendy stuff like HRW dryness in a country whose exports are dismal anyway won't resist real numbers when the new crop will come... The only enemy to short spreaders is money coming from equities...Like this post if you approve. NB: Yes, I am drunk and it is midnight on saturday in Europe... I should be doing something else.
I960, you are totally right. When you read all the industry news everyday, you are tempted to put too much importance on it. This RFS summit with Trump was scheduled and I put too much weight on anything coming out of it. I am sure the path of least resistance is still up...
Hahaha thanks. When you say shorting the forward curve do you mean selling far dated contracts and buying near dated contracts for the same product in expectation that the forward curve will narrow (flatten) or invert and go into to backwardation?
Just the contrary. I short front months and go long further months. I expect contango to increase. I quote like pit traders, TT, CTS. You quote like IB.
Ah ok. Understood. Thanks. CTS = commodity trading specialist (floor specialist?) What's TT stand for? Does IB stand for interactive brokers or inter bank or investment bank? (Can't think of another IB) When you say 'Money coming from equities' is that because they are expected to buy near dated contracts (implying they are chasing outright price move instead of term structure)? So 'shorting the spread' from the floor's point of view is long the contango (expecting widening contango) - is that right? What do you think is driving such a broad increase in contango? (in addition to increasing interest rates)?
Also do you have any recommended generalised reading for inter/intra Ag commodity market dynamics or is each market a completely specialised set of reading? For increasing general contango is increasing oil price something you are already factoring in or static oil price?