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Soybeans…
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Soybeans…

by MoleJune 17, 2011

This is Volar with a quick and dirty trade idea.

I know you all think all I do is stock sentiment, but I live and breath the energy and grain markets every single day.

It is planting season for soybeans, and I know that the farmers are going to plant corn this year due to the economics.

Here is November (harvest/farmer hedge contract).

This has a potential to be the F*** farmer trade. Aka they all get hedged on a triple top… and volar bets against those…

Or I am looking for a few thousand farmers to get squeezed out of short hedges for their crop on new highs.

Here is DEC corn.

Clearly a trend breach. Retesting now. I am not short corn, but it is telling me corn is breaking down vs. soybeans.

Here is the “new crop” or “harvest” ratio.

Clearly the ratio is very very low at 2.1x. I am betting on beans here in hope of a *massive* short squeeze. There are reasons for seasonality, and I am going to play the probabilities.

Obviously just another day of trading, but this is one of my *favorite* trades to do each and almost every single 3rd week of June.

If any of you guys dont understand this, just let me know. I know it is a “different” market, but trading is trading to me.

Best of luck trading,

-Volar


About The Author
Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at various social media waterholes below.