In spite of a drop in the outright market for wheat, CBOT was the strongest performer of the three wheat futures. Seeing from the open that the market had the potential for a big down day, I tried to be patient and hold my long MGEX/short CBOT position waiting for the trend-followers to dump their CBOT wheat. Didn't happen that way--and in the end I liquidated more of my position though not all.
The price action was very negative for both corn and wheat. Corn started at new highs, but finished down for the day. Dec wheat stayed above $7, but not by much; there was no sign that anyone in the market saw this level as a screaming bargain. With the CFTC COT report showing continued high levels of long positions among trend-followers, this bull market in wheat needs to move forward or we will see some liquidation.
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