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RSS By: Bob Utterback, Farm Journal

Bob Utterback has more than 26 years of experience and offers producers a disciplined approach to marketing.

Bulls are on the retreat!

Jun 22, 2009
Well the big bulls of June have now been put out to pasture and you will be hard pressed to find anybody with the nerve to buy this market. This goes to show you how the crowd can quickly turn. As you know, I got a little bullish in early June after one Friday visit to my monthly U.S. Farm Report taping where a guest speaker said corn was going to $8. Since I was heavily short, I decided to get a little defensive. As it turns out the bulls were only right for about four days and the rest of the month the market has been straight down.

So where do we go from here? I would suggest next Monday’s report will have difficulty now being a bullish surprise. Everybody is expecting at least 1.5 million reduced acres or more. The risk right now is what happens if it’s only down 500,000 acres. Second, the outside markets have turned bearish. The fear of inflation is dead for now and in fact many are starting to worry we will have a further dip in the economy. In summary, the outside markets are not supportive of bullish positions.

So what’s can the bull hope for? When the crowds give up, this is usually a good time to start moving in the other direction. Second, the big one is weather. While the crop looks good, it’s still 30 days behind. Some would say we are catching up up a little, but I have to say there is still a lot of tough conditions; low sun spot activity combined with the resumption of the El Nino has many weather people calling for a shift to dry conditions. The problem is they will not say if it’s August, September or October. So right now the weather bulls have only hope rather than actual fact. This is why the market continues to slip. 

What to do? I believe it’s time to reduce exposure of speculative long positions. Look to only add to positions if the market starts taking out the previous week’s highs or closes above the down trending support line.
If you need any help in implementing a speculative or hedging strategy give us a call at 1-800-832-1488 or email me at utterback@utterbackmarketing.com or laura@utterbackmarketing.com.

BEFORE TRADING, ONE SHOULD BE AWARE THAT WITH POTENTIAL PROFITS THERE IS ALSO POTENTIAL FOR LOSSES, WHICH MAY BE VERY LARGE. YOU SHOULD READ THE “RISK DISCLOSURE STATEMENT” AND “OPTION DISCLOSURE STATEMENT” AND SHOULD UNDERSTAND THE RISKS BEFORE TRADING. COMMODITY TRADING MAY NOT BE SUITABLE FOR RECIPIENTS OF THIS PUBLICATION. THOSE ACTING ON THIS INFORMATION ARE RESPONSIBLE FOR THEIR OWN ACTIONS. ALTHOUGH EVERY REASONABLE ATTEMPT HAS BEEN MADE TO ENSURE THE ACCURACY OF THE INFORMATION PROVIDED, UTTERBACK MARKETING SERVICES INC. ASSUMES NO RESPONSIBILITY FOR ANY ERRORS OR OMISSIONS. ANY REPUBLICATION OR OTHER USE OF THIS INFORMATION AND THOUGHTS EXPRESSED HEREIN WITHOUT THE WRITTEN PERMISSION OF UTTERBACK MARKETING SERVICES INC. IS STRICTLY PROHIBITED. COPYRIGHT UTTERBACK MARKETING SERVICES INC. 2009.
 
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COMMENTS (2 Comments)

Anonymous
The USDA planting report comes out next Tuesday, June 30, NOT next Monday.
8:29 AM Jun 23rd
 
Anonymous
hey bob, i really wonder where the data comes from in these reports. I am sure there are areas in the country the crops are great, thats true every year. I have been from central IL to Evansville, IN west to St. Louis, MO and to indy lots of bean stubble unplanted (corn acres this year) soybeans at best 50% Report says IN 90% planted that just is not correct, not correect number for IL either. Its june 22 the clock is ticking rapidly now, last year replants on june 25 made half of june 1 planting with perfect conditions, thats probably not going to be true 2 years in a row. My corn is 6" tall and yellow if it dries now will be late august before tassel, we just run out of time for maximum production. Only have 40 acres of beans planted, 5.75" of rain since planted i really don't need to go any further.
10:03 PM Jun 22nd
 
 
 
 
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