Playing the game ahead of the USDA Quarterly Stocks Report
Mar 27, 2013
The USDA "Quarterly Stocks Report" will obviously garner most ALL attention this week amongst grain and soy traders. The problem is I don't know one trader that isn't looking for a "bullish" number. In fact many of the "bears" have moved to the sideline in anticipation of the bullish event and seem ready to pounce on any type of major rally. Remember, last year we traded down prior to the report and received a pleasant bullish surprise. This year we have traded up into the report (the past couple of weeks) and may be setting ourselves up for a little disappointment. There is no question we are going to see some extremely tight bullish numbers by the USDA, I am just wondering if the trade doesn't already have that factored in. One thing I can assure you is that there will be extreme volatility off the release of this data. I suspect the waters to be insanely fast, furious and testing of the outer limits. Therefor if you have some price targets in mind (for either old-crop or new-crop) I would suggest entering them ahead of time rather than trying to catch a speeding bullet. For me it is not going to be so much how the board reacts this week, but how the "cash markets" respond a little further down the road when supplies really start to dry up??? If your a spec player be careful following the herd right now. Everybody and their brother seems to want get short off the rally, I am just not sold as of yet on this being the right move. Producers should continue to "HOLD" any small remaining supplies.