Posted 11/2/2014 08:37 (#4156583 - in reply to #4156560) Subject: RE: Buoyancy.. prices are coming back up..
JonSCKs - 11/2/2014 08:22
The reason for the rallies are that things got oversold.. for instance.. we NEED to hold the decline in corn acres for next year.. That's gonna take $4.50+ corn to get a big enough crop.. >
Jon, I get the logic, but oversold doesn't mean more won't be sold. "WE" holding on to anything assumes some benevolent or at least collective force driving the market to produce a desired outcome in reality. I don't think our market is controlled by folks concerned about physical grain just like buyer's of IBM stock are not concerned about super computers. They just want to see the price increase so they can sell at a profit. Often commentators try to characterize the DJ trade hour by hour and in reality it's just a guess since the trade is made up of millions decisions all being made for potentially very different reasons. I see the grain market since 2008 much more like stock trading anymore.
Pick a price, be happy. If you want $12 beans, just wait it might get there. I can't say you'll know why they are there though.
My thought is that if true fundamentals took full control we'd be at $2 and $6. No end user needs to bid up since supply is plentiful. Thankfully for the grain side of me, that's not the case.
Explaition
