After mentioning how patient I've been with the Dec MGEX/CBOT wheat spread, I was happy to let about a third of my position go today at the best levels since the late June surge of CBOT wheat prices. Of course, by keeping 2/3 I'm indicating that I think there are likely higher levels ahead--though not as confidently as before.
While the rallies in corn and cotton look like they are due for at least a correction, the rallies are not confined to ags. With gold making new highs and the dollar trending lower, the overall climate is very bullish for wheat prices. Despite the high levels of non-commercial longs (speculators), I fear another push higher on the CBOT wheat contract. The early August spike over $8/bushel probably marked the highs for many months, but the pain lingers on...
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