By Scott Harms, Archer Financial Services
The Commitment of Traders Report carries little significance this week as the data is only through Tuesday, the day before the USDA Report.
In corn it shows that the funds continued to aggressively liquidate long corn positions ahead of the report. This may have helped to fuel the market’s strength this week as that money scrambled to get back into the market.
The USDA data confirmed what the market already knew and that is that corn and soybean stocks are uncomfortably tight. The job of the market is now to make sure that they don’t continue that trend.
Traders will be keenly watching for signs of rationing over the next couple of weeks. In addition, the market will be watching for signs of weakness to the crude oil market. A trend change in that market may pull the breakeven for ethanol producers down from the $6.80-$7.00 targets that analysts now predict.