Trading the weather

Discussion in 'Trading' started by granville, Nov 22, 2005.

  1. Does anyone do this? The CME's weather futures seem to have some VERY extreme price fluctuations. Looks like an interesting market to trade.


    Speculation requires liquidity.
  3. yes, I concure... but the price moves from $10 to $180 and back down to $10 in nice trends during the course of a year.

    I would think that liquidity is growing and so I wonder if anyone has tried this market. I don't know of any market that moves this much (without leverage).
  4. Focus instead on weather sensitive markets, i.e. grains during the summer & livestock, orange juice and natural gas during the winter.
  5. Exactly.

    I will predict that despite the current bearish fundamentals in the Beans, you will see the $10.80 highs of early 2004 taken out next Spring . . . and the spirited chant of "Beans in The Teens!!!" coming to a quote screen near you in the near future.

    This will be the Trade of 2006.
  6. I hope you're right............otherwise you'll have to change your name to AbyssCapital!
  7. OK, here's a monthly bar chart for the CME's Osaka Average Temperature future's contract:

    I'm just starting to look at these, but DANG... they look beautiful!