looks like SX could go to around 10, CZ is a little tricky as there's no support on that chart but I'm keying of the spot low at 3.18 as support there.
At that point puts will be deeply in the money so I'll roll them down a few strikes- will give up a few cents' delta on the hedge but still be well protected from catastrophe.
At that point I'll be playing with the house's money If there is some sort of bounce probably make incremental cash sales, cash the puits and put a wrap on it.
2017 is looking problematic but at some point, maybe sooner than later, somebody will probably come up with a story to drive a rally- and it might even turn out to be true.
Bean bulls might even turn out to be right but as the saying goes there's no difference between being early and being wrong. Spec longs are going to give an involuntary blood donation here
Being early and being wrong are the same thing...too true 🙂 However some of these old goats with deep pockets sitting on 3 years of grain in their own tin cans can create their own alternative universe and write their own happy ending, assuming they aren`t too stubborn or affraid of paying taxes.
All of those words are English, but I have absolutely no idea of what you're saying! I got the part about using a bean fed bull to trim the hedge down in the delta for very little money, but how does baseball and blood donations come into play? What am I missing?
I just totally disagree with the "being early is the same thing as being wrong". For which decisions? I sold some new beans at 10.60, was that early, maybe but you don't know that until hindsite. Sold some more at 11.42. Was that early? Yes by 1 day. Was that wrong, according to you guys it was. Will it be wrong 15 months from now when the marketing year is over? Never for us. It was part of the plan, a plan that we are quite comfortable with over the years.
We are ALWAYS going to be early on a portion, nail the high to the day sometimes, and always be late on a portion. Those 3 decisions are all of the same amount of correctness. They fulfill a statistically driven decision making process that allows our business to prosper through time.
But yes, we will certainly be early and wrong quite often in HINDSIGHT!@#$%
I was referring to the specs who got historically long beans/meal, in part due to concerning long range weather forecasts and in part owing to the momentum those helped to create.
Beans are a long way from being made but only a major forecast map save is likely to keep the funds from getting rubbed out before any of us find out.
I'm not a big fan of Gann cycle timing but he does have some great quotes. Among them "market action isn't about who's right its about who's wrong."
Around the spring lows the people who were wrong were the ones who thought that no risk premium was warranted.
Barring a weather shift we're probably going to overdo this thing on the downside and then get into the real price discovery process.
There's a fair chance that it won't be as bad as feared but also an increasing chance of really big crops.
I assume that low prices through Aug will help CCPs some?
But I suppose also nicks away at the rolling averages. I'll have to go back and revisit the calculations but I suppose that if the world makes OK crops for a couple more years the safety net is going to get stretched closer to the floor?
The problem these days is that we deal with a world market that is more often than not driven by politics rather than supply and demand. Considering the volatility of world politics these days, trying to play the market is akin to setting a steel jawed trap for a bear wandering around in the woods. You place the trap based upon the bear's past actions or movements and what you think he will do in the future, but you have no guarantee the bear will do what he has done in the past or will do what you think he will do. If you do happen to catch him, you pat yourself on the back for being so wiley when chances are it was more luck or simply being in the right place at the right time that is was wisdom or shrewdness. And whether you're talking beans or bears, you look at things reasonably but bears and markets don't always act reasonably.
I still remember when the USSR invaded Afganistan and President Carter imposed an embargo on our grain sales to the USSR. That dropped the price of beans from something like $7 to $4-5 overnight. And even though the government bought the beans, which temporarily bouyed the market, they unloaded them slowly which affected prices for a year of so after that. And remember that no matter how informed you think you are of world affairs, you have no idea of what's going on behind closed doors in Brazil, China, Russia or some small rogue nation. I'm sure I was farming when some of you young bucks were still in diapers, so remember that if you happen to sell on a high point, don't get too confident and think it was due to your superior intellect and reasoning. That same intellect and reasoning may bite you in the butt the next time. And as for taking advice from all the so called "experts", how many of those experts kept saying that Trump would never get enough votes for the nomination? Plenty of them have since had a big fat meal of crow.