CoT & Price Action Update

Published on: 11:40AM Dec 11, 2010

 Commitment of Traders

v    Wheat saw commercials unload long positions down to nearly neutral and funds switch from net short to net long. All in all, the CoT for wheat is neutral

v    Bean positions have been pretty stable for the past five weeks: funds are quite long and farmers plus commercials are equally short. My estimate is the magic numbers are 1350 and 1175: prices above the one or below the other will motivate the funds to buy or sell in significant amounts.

v    Corn positions have been mostly stable since October 1. There seems to be a slight oozing towards neutrality, but we are in a waiting game.

v    Oats saw some renewed optimism by the funds and corresponding shorts by the commercials. Here the magic numbers look to be 405 and 335.


Price Action

v    Wheat has a price pattern that suggests it wants to do something. It looks a bit more bearish – or maybe I just see it that way – than bullish. 815 and 765 basis March appear to be the fund buy/sell numbers.

v    Beans actually look pretty soggy. A daily close below 1264 is apt to generate further downside action. In theory, this could be the start of something beautiful for the bears.

v    Corn still has, at least in theory, upward momentum. The actual price action looks like no one has much of an opinion. In other words, the past six trading days have been really boring.

v    Oats look quite bullish. Tuesday saw a good bit of selling but the market absorbed it all then moved up. Are oats just the odd man out, or is this a prediction for the rest of the grains? We shall see.