$534 on the March gives us a spot $11.81 bid into Assiniboia. I’m a small Seller today.
In front of a decently important USDA report tomorrow morning it would be remiss of me not to take the $11.81 that’s in front of us and roll the dice on a good report for just another 10 cents. I therefore will be moving sales up by another 10% today on the spot month contract – moving to 75% sold Canola.
I believe the report will be mildly Bullish and the Charts are certainly in our favour, however risk is present on four fronts: 1) Expectations are for a Bullish report and so limited upside without a strongly Bullish report. 2) Big rains in Argentina are being ignored and could become a focus once report is out of the way. 3) The Outsides are getting overbought and Greece is playing politics – and have a few years of experience on that front. 4) Technically we’ve broken a pennant to the upside, but have not confirmed a takeout of the January highs so any drop here will install a pretty solid double top at an already strong Resistance plane.
Targets out imminently – this note is background on the forthcoming Canola recommendation. All things being equal, if it was not a report day tomorrow, I would not be selling today – hence 10% instead of 15%.