It’s not unusual for find  day traders who are well versed in the technical skills of futures trading .  But there is another component to trading that is rarely discussed and given little considertion .  Yet, in my opinion, it is the only skill of day trading that distinguishes successful traders and unsuccessful traders.  Let’s face it, assimilating a trading system not a hard task to achieve.  Most systems are similar in nature, as each system is looking for for potential break outs and break downs for the trader to profit on in his or her trading.

Of course, the secret is identifying a tradable break out or break down is a challenging , and discerning which trades are just temporary retracements in one direction and bound to reestablish their movement in a opposite direction than the trader plans is frustrating.  Oddly enough, I have penned several articles about the emotional aspects of trading, and they are the least read articles I write.  While some articles get an abundance of views, articles on psychologica l aspects of trading are generally ignored .

And that is not as it should be.

Learning a trading style is relatively easy , as it is only a basic memorization and rote learning.  On the other hand, learning to implement a day trading system is a difficult and arduous proposition .  In other words, learning to curb your emotions while trading is no easy matter.  To take it step further, it is my feeling that controlling your emotions while trading is the single most difficult skill to accomplish when trading.

Oddly enough, when I speak with traders and mention the topic of emotional paramaters of trading the response is predictable traders commonly comment “oh, I don’t have any problem with that stuff.”   The statistics, on the other hand, bear out a much different story.   More than 70% of traders fail within the first three months of trading.  Something is clearly wrong.

I am going to elaborate on two very significant mistakes new traders commit , and subsequently sabotage their success.  The first is over trading, and the second is trading with no stops, or adjusting their stops to accommodate a trade gone south .

Lets commence with over trading, as this phenomena seems to be the most common malady I see in new traders .  To be blunt , there are not enough bona-fide set-ups throughout the course of the day to justify that you can make 10+ trades a day and be successful .  There are many set-ups that “at face value” look like potentially profitable trades, but a thorough examination of the trade may expose the trade is intrinsically flawed, and should be avoided .  Yet I observe trader after trader enter into these marginal trade in hopes of devising that one great trade.  To be sure, that one great trade does not come along very often, maybe once a week, so it is fruitless to focus on taking only whopper trades.  I am a singles hitter, and if I can get 3 points on a given trade, I am happy .  But in order to capture three points, I need all of my i oscilators to point in the right direction.  If I find any of my indicators moving opposite from the direction of the trade I am evaluating , I instantly exclude that trade from consideration.  Further, I am diametrically averse to initiating counter trend trades.  Which is not to say I never take a counter trend trade, but I must be absolutely sure that the trade is a quality trade.  In summary, over trading in the downfall of many traders, and most traders would be wise to concentrate on trading only high quality trades, those with a high probability of success.  Specifically, high quality trades usually occur when a trader trades with the trend.

There is absolutely no excuse for a trader to enter a trade without having preset stops in place.  No stop trading is fiscal disaster .  If you initiate a trade and it heads in the wrong direction it is imperative to exit the trade and find a more favorable trade in which to participate.  Often times I notice traders end up on the wrong side of a trade and then move their stops lower, hoping their trade will make a heaven-sent comeback .  While trades can change direction , it is a rare event .  The reason we set stops is to limit losses, and by increasing your stops you are, in essence, increasing your losses and your risk exposure.  In short, there is no reason to adjust your stop-loss limits.  If you have initiated a bad trade, take your losses and move on to a more suitable trade set-up.  

Of course, as traders our mind set is to trade.  After all, you can’t make money if you don’t trade.  However, the goal is to be in the correct day trade at the right time.  Your emotions will often disassociate your intellect from the realities of the market and you will find yourself in positions that can be disastrous .  Check your emotions and ego at the door and simply trade the chart in front on you, free from emotion, and trade with the reality of the chart in front of you.   Hoping for a trade to work out is a bad investment strategy; pick the trades with the highest probability of success and profit.

As your trading journey progresses you will undoubtedly go through many different phases.  . In this article we will explore the 5 key phases that every trader goes through as they develop as a trader. At every stage along the way (until you reach Stage 5), there is a likelihood that your journey will end . Indeed if you believe all you read Some suggest as few as 5% of traders ever reach consistent profits  . My guess would be that those 5% exist across stages 4 and 5, meaning 95% of those that start trading give up when at Stage 1, 2 or 3. If you make it through these stages, there is a strong probability that you will become one of a select few that can proudly state that you are a consistent, professional trader. When reading the below, ask yourself whereabouts in your trading journey are you.

Stage 1 –  Trading on Hearsay  . This is where most traders/investors start, and end, their journeys . They act on hearsay and advice from ‘professionals’ and friends.  These Traders have little or no understanding of the concepts of risk or money management  . They have probably never heard of a stop loss or a profit target and have certainly never thought about writing a trading plan. Instead they will pile their cash into a company because ‘Joe in accounts gave them a hot tip’ . Sadly these tips can not go on forever and the journey’s of these traders will invariably end in 1 of 2 ways. Most likely after a series of devastating losses, then will simply close their accounts and believing that trading is tantamount to gambling they will vow never to return to the markets. Those whose journey does not end at this point, will move quickly into Stage 2.

Stage 2 – Information overload and the holy grail. Those traders who do not give up at Stage 1 will likely enter into a wonderful and exciting stage of their journey. They will consume as much trading material as they possibly can . Their focus will be on finding trading systems that guarantee victory! They may even purchase a couple of systems (NO NO NO!!). They will skip from one system to the next constantly searching for the holy grail – that one system that delivers consistent profits. They will tweak settings on Stochastics and RSI  , each time thinking that they have found the holy grail  . They will have periods of success that makes them feel great. They will believe they have made until, until one day, their system simply stops working and they enter a period of losing trades. They will scratch their heads and maybe even tweak a few technical aspects of their systems. But the reality is, they have realized that the holy grail does not exist . Despondent, many will now quit, convinced they have tried everything in their power in order to make money in the stock market. Those that don’t quit will move to a different and even more exciting  stage in their trading journey

Stage 3 – Profit and Loss (Large P/L and emotional swings). One day thinking you have made it, the next thinking that you have not. If a trader makes it this far, the odds are good that they have the mental discipline to succeed  . They now understand two great lessons. 1 do not listen to other people and 2, there is no such thing as the holy grail. Traders at stage 3, may now be developing the mind of a trader. They may already begin to understand the emotional and psychological aspects of trading and how vital these elements are. They will certainly have figured out what kind of trader they are (technical or fundamental, trader or investor, short and longer term) and they will now understand what is important in trading. They will likely enjoy sustained periods of success, only to be followed by depressing periods of drawdown. They will one day believe they understand how to make money, only for the next day to believe that they do not. This period of the trading journey can be a long and emotional one and requires significant perseverance and belief in one’s self. Few traders will actually give up at this point, many will continue to trade with a modicum of success. Perhaps it will become a hobby, that every now and then pays for a holiday or car insurance. It’s not a bad place to be. Traders at stage 3 are unlikely to lose all their money.  If traders do not move from Stage 3, they will not have a shot at the title…. 

Stage 4 – Consistency. The early stages of being a consistent trader can be like sitting on a knife edge . There are periods when you suddenly believe you are back at Stage 3, a series of losses can still occur and you begin to doubt your ability and your system. This is not unusual, but most traders at Stage 4, will have the emotional understanding to identify and rectify this emotional state . It may be that they simply take time away from the markets, or they  starting trading reduced size as this  can remove these emotions. They will totally understand that trading is a percentages game and that they only way of winning is by protecting their trading capital and by being disciplined in their approach. This Stage can last for years. Understanding and dealing with emotion can take many years. Until such time as wins and losses do not affect your mindset you will remain at this stage.

Stage 5 – Professional. These dudes are trading for living . They are sat in their home offices totally comfortable in their ability to make a living trading the financial markets. They have experienced periods of profitability and periods of loss and are agnostic to both. They accept that trading is simply about probability and being consistent in their approach of finding and trading edges. They will also likely have sizable trading accounts as they will be risking 1% or less on each position and looking to make 2-3% per trade.

Getting to Professional status is the dream of many (if not all) self-directed traders. Understanding the journey and the Stages in that journey will help us all to plot our paths to Stage 5.

Corn Market Recap for 08-04-10

September Corn finished up 10 3/4  at 400 1/4, 1 3/4 off the high and 12 3/4 up from the low. December Corn settled11 higher at 415. This was 13 1/4 up from the low and 1 1/2 off the high.

December corn pushed higher late in the overnight session and then traded near the day’s highs into early afternoon. This was the highest close since January 14th. This came despite a rally in the dollar into the day session. Traders credited today’s strength in corn to buying by funds and commission houses sparked by massive gains in wheat. Excessive heat continues to be a problem in the central and southern tiers of the Corn Belt, with excessive moisture in the west and north central Corn Belt a lesser concern. Forecasts call for a surge of very hot air into the northern and eastern Midwest next week. The Energy Information Administration (EIA) released its weekly ethanol production data today. Ethanol production for the week ending July 30th averaged 873,000 barrels per day, up 57,000 barrels per day (6.99%) versus last week. This is up 145,000 barrels per day (19.92%) from last year. Corn used in last week’s production is estimated at 91.665 million bushels. Cumulative corn usage for ethanol production for 2009/10 is 4.08 billion bushels. Corn usage needs to average 102.422 million bushels per week to meet this crop year’s USDA estimate of 4.5 billion bushels.

September Rice ended up 0.27 at 11.03, equal to the high and equal to the low.

Wheat Market Analysis for 08-04-10

September Wheat finished 45 3/4 higher at 725 3/4, 6 1/4 off the high and 47 1/2 up from the low. December Wheat settled 45 3/4 higher  at 755 1/2. This was 47 1/2 up from the low and 5 3/4 off the high.

Nearby wheat futures surged more than 45 cents today to push to the highest level since September of 2008. This means that nearby futures have rallied more than $3.06 off of the June lows or a gain of 72%. December wheat started higher in the overnight session with gains accelerating late in that session. The strong uptrend continued throughout the day session with the December contract pushing to its highest level since June 3rd in the process. Traders said that buying by funds and commercials sparked short covering throughout the day. Importers appear to be stepping up buying in wheat as they adjust to dislocations caused by the ongoing drought and heat wave in Russia. Some of this buying is for near term delivery. Egypt bought 100,000 tonnes of Russian wheat today on its tender for 60,000 tonnes. Traders indicate that Russia may be trying to demonstrate that it will not curtail wheat exports, and sources in Russia note that favorable crop conditions near export points on the Black Sea coast also support a continuing export regime over the short term. Tunisia bought 50,000 tonnes from optional origins, and Jordan bought 50,000 tonnes of Black Sea origin wheat. Both the Egyptian and Jordanian purchases are for delivery in early September.

December Oats finished  up 5 1/4 at 293 1/4. This was 8 3/4 up from the low and 2 3/4 off the high. 

Soybean Market Commentary for 08-04-10

September Soybeans ended up 6 1/2  at 1029 1/4, 5 1/2 off the high and 10 1/2 up from the low. November Soybeans settled up 6 1/4 at 1024 1/4. This was 11 1/2 up from the low and 5 1/4 off the high.

August Soymeal closed  up 3.2 at 311.5. This was 3.5 up from the low and 1.4 off the high.

August Soybean Oil ended  up 0.41 at 41.36, 0.05 off the high and 0.31 up from the low.

November soybeans pushed higher late in the overnight session and then traded below the day’s early highs into early afternoon. A late burst resulted in a fractional new high in the November contract, and this matched Monday’s high. Meal and oil both finished higher with trade in the meal/oil spread mostly directionless throughout the day. Traders said that the surge in wheat generated short covering and some spec buying in the soybean complex today despite an early rally in the dollar. Traders note that there is some concern over the hot weather patterns that have dominated the central and southern tiers of the soybean belt in recent weeks. Some forecasters are calling for this system to push north into the central and eastern Midwest on Sunday and Monday, resulting in uncertainty over the yield outlook if temperatures hit the upper 90s and 100s in the central Midwest next week. This comes ahead of next week’s Crop Production report from the USDA. Traders are currently looking at yield to be unchanged to fractionally higher from the USDA’s July forecast of 42.9 bushels per acre. The USDA announced a sale of 121,000 tonnes of soybeans to China this morning for delivery in the 2010/11 marketing years. Traders said that this was considered supportive.

After reading ï»¿today’s recap,traders might want to take a peek at the commercial traders  momentum.  The Commercial Trader momentum can be tracked by using the Commodity Futures Trading Commission Commitment of Traders reports.  Our idea is that, in a value driven commodity futures market no one knows fair value like the people who produce it or, have to use it.  In fact, it is precisely their sense of value that provides the commodity market’s rhythmic meanderings that swing traders love so much.  Let’s face it, producers know when their product is overvalue and it should be sold just as well as end line users know when they should be stocking up at low prices.  Therefore, trader should be able to incorporate this valuable information into their future market education.

The daily commentaries provide a review of any reports released that day, a recap of each commodity’s traded price activity, an analysis of the factors that influenced price activity, and a look ahead at the schedule for the next day.  Market commentaries for corn, wheat, soybeans, gold and silver are provided by CME Group.   The information in the Market Commentaries was obtained from sources believed to be reliable, but we do not guarantee its accuracy. Neither the information nor any opinion expressed therein constitutes a solicitation of the purchase or sale of any futures or options contracts.

Andy Waldock circulates this blog.  Andy Waldock is a financial advisor, analyst, broker, asset manager and traderfor Commodity & Derivative Advisors, located in Sandusky, Ohio.  As a result, Andy Waldock may have positions for himself, his customers, or his relatives in any commodity future market reviewed. The blog is meant for educational purposes and to develop a dialogue among those with an interest in the commodity future markets. The commodity markets employ a high degree of leverage and commodity trading  may not be suitable for all investors.  There is considerable risk in investing in commodity futures.  If you are interested in reading other published articles, commenting  on his writings or subscribing to Andy’s blog, please visit http://blog.commodityandderivativeadv.com, or if you have any questions, please call 1-866-990-0777.

Soybean Complex Market Review  for 8-5-10

September Soybeans finished up 5 1/2 at 1034 3/4, 19 3/4 off the high and 17 3/4 up from the low. November Soybeans settled up 4 3/4 at 1029. This was 18 up from the low and 20 off the high.

August Soymeal settled up 2.1 at 313.6. This was 4.6 up from the low and 5.4 off the high.

August Soybean Oil ended down 0.1 at 41.26, 0.71 off the high and 0.36 up from the low.

November soybeans soared to start the day, but eased into early afternoon before surrendering most of the day’s remaining gains into the close. Traders said that the initial gains were sparked by the rally in wheat and a surge in export sales for soybeans with some support also credited to continued hot and dry conditions in the southern Midwest and Delta. Meal gained on soy oil on the day with oil finishing lower in line with modest losses in crude oil. This week’s export sales came in above trade expectations in soybeans at 6,000 tonnes for the current marketing year and 1,168,100 for next year for a total of 1,174,100. China cancelled 172,400 tonnes of old crop soybeans, but added 799,500 tonnes in new crop. The USDA also announced a fresh sale of 455,000 tonnes of soybeans to China for delivery during the 2010/11 crop year. This was not included in the weekly total. The USDA announced another fresh sale of 111,500 tonnes of soybeans to an unknown destination for 2010/11. This was also not on the weekly report. As of July 29, cumulative soybean sales stand at 25.4% of the USDA forecast for 2010/2011 (new crop) versus a 5 year average of just 15.4%. Sales need to average 488,000 tonnes each week to reach the USDA forecast. Net meal sales came in at 132,800 tonnes for 2009/10 and 2,200 tonnes for next year for a total of 135,000. Sales need to average 130,000 tonnes each week to reach the USDA forecast. Net oil sales came in at 64,800 tonnes for old crop and 2,000 for new crop for a total of 66,800. Sales need to average 4,000 tonnes each week to reach the USDA forecast. Brazil’s crop supply agency, Conab, lowered its estimate of their 2009/10 soybean crop to 68.47 million tonnes from their previous estimate of 68.71 million. The new estimate is still a new record large soybean crop for Brazil. Weather remains hot and dry in the Delta, raising concern over crop stress there.

Corn Market  Analysis  for 8-5-10

September Corn ended  up 3 1/4 at 403 1/2, 21 3/4 off the high and 8 up from the low. December Corn closed up 3 at 418. This was 8 up from the low and 21 off the high.

December corn rallied late in the overnight session following even sharper gains in wheat. This was followed by new highs to the start of the day session. However, the corn market eased into early midsession before erasing the remainder of the day’s gains prior to the close. Traders said that selling in soybeans and late selling by funds in corn helped to pressure the market along with a late wave of selling by spreaders versus wheat. Funds had been heavy buyers earlier in the day. Drought in Russia has resulted in a ban on grain exports by that country. This will include feed wheat, including existing contracts, and traders say this should shift demand to corn due to its lower cost and greater availability. This week’s net weekly export sales for corn came in at 472,200 tonnes for the current marketing year and 821,900 for the next marketing year for a total of 1,294,100. As of July 29, cumulative corn sales stand at 9.0% of the USDA forecast for 2010/2011 (next) marketing year versus a 5 year average of 9.6%. Sales need to average 791,000 tonnes each week to reach the USDA forecast. Brazil’s crop supply agency, Conab, increased its estimate of their 2009/10 corn crop to 54.38 million tonnes versus 53.46 for their July estimate.

September Rice ended  down 0.1 at 10.93, 0.37 off the high and equal to the low.

Wheat Market  Recap  Report for 8-5-10

September Wheat finished  up 60 at 785 3/4, equal to the high and 61 3/4 up from the low. December Wheat settled  up 55 3/4 at 811 1/4. This was 57 1/4 up from the low and 4 1/4 off the high.

December wheat soared to limit up overnight and into the start of the day session. After pulling back from the highs after the open, the December contract spent the remainder of the session trading just below the highs. The nearby September contract led the gains today with the December wheat contract also gaining on deferred contracts. Russia’s announcement that it will temporarily ban exports due to the ongoing drought confirmed reports from earlier in the week. Cash traders indicate that this will affect existing sales of grain and grain products and that exports will be banned from August 15th to December 31st. One analyst noted that Russia itself does not have a complete handle on the final supply of wheat other grains, and it may not have a fully developed plan on how to dampen the food inflation that is the government’s main concern. This week’s export sales were strong again at 854,600 tonnes. The USDA also announced a fresh sale of 110,000 tonnes of hard red winter wheat to an unknown destination for delivery in the 2010/11 crop marketing year. This was not included on the weekly total. As of July 29, cumulative wheat sales stand at 34.0% of the USDA forecast for 2010/2011 versus a 5 year average of 34.9%. Sales need to average 410,000 tonnes each week to reach the USDA forecast. Traders in Europe indicate that wheat exports from Bulgaria are up despite a lower crop there this year with 150,000 tonnes currently being loaded. Egypt has announced that it will buy 60,000 tonnes of wheat per month to make up for the shortfall in Russian sales.

December Oats settled  up 1 1/4 at 294 1/2. This was 4 3/4 up from the low and 15 off the high.

After reading ï»¿today’s review,traders might want to take a peek at the commercial traders  momentum.  The Commercial Trader momentum can be tracked by using the Commodity Futures Trading Commission Commitment of Traders reports.  Our idea is that, in a value driven commodity futures market no one knows fair value like the people who produce it or, have to use it.  In fact, it is precisely their sense of value that provides the commodity market’s rhythmic meanderings that swing traders love so much.  Let’s face it, producers know when their product is overvalue and it should be sold just as well as end line users know when they should be stocking up at low prices.  Therefore, trader should be able to incorporate this valuable information into their future market education.

This blog is published by Andy Waldock.  Andy Waldock is a financial advisor, trader, analyst, broker and asset managerfor Commodity & Derivative Advisors, located in Sandusky, Ohio.  For that reason, Andy Waldock may have positions for himself, his relatives, or his clients in any commodity future market reviewed. The blog is meant for educational purposes and to develop a dialogue among those with an interest in the commodity future markets. The commodity markets may not be advisable for all investors due to the high degree of leverage.  Investing in the commodity futures could result in substantial risk.  If you are interested in reading other circulated articles, commenting  on his writings or subscribing to Andy’s blog, please visit http://blog.commodityandderivativeadv.com, or if you have any questions, please call 1-866-990-0777.

The daily commentaries provide a review of any reports released that day, a recap of each commodity’s traded price activity, an analysis of the factors that influenced price activity, and a look ahead at the schedule for the next day.  CME Group provides market commentaries for wheat, soybeans, corn, gold and silver.   The information in the Market Commentaries was obtained from sources believed to be reliable, but we do not guarantee its accuracy. Neither the information nor any opinion expressed therein constitutes a solicitation of the purchase or sale of any futures or options contracts.

Wheat Market Commentary Report for 7/22/2010

September Wheat finished 8 1/4 higher at 596 1/2, 13 1/2 off the high and 12 3/4 up from the low. December Wheat closed up 8 3/4 at 627 1/2. This was 13 1/4 up from the low and 12 1/2 off the high.

Wheat was the leader to the upside over corn and soybeans again today. Traders are said to be nervous about the extent of crop losses in Canada, Europe and North Africa, and this has generated steady, substantial buying by funds and commission houses. Today’s gains took the December contract to its highest level since December 2nd, 2009, although prices retreated from the early highs into mid session and into the close. Traders said that the market was boosted by a lower dollar and continued concern over the drought in Russia. Adding to the recent negative production news were reports that rains have slowed wheat planting in Argentina. The Buenos Aires Grains Exchange said today that if rains continue, this year’s planted area could be lower than expected. Planting was 79% complete as of Thursday according to the exchange versus 99% at the same point last year when a drought reduced planted area to its lowest level in decades. The exchange says that, for now, it is keeping its planted area forecast unchanged at 4.2 million hectares. This week’s export sales came in near expectations but below the average total needed each week to reach the USDA’s export projection. Net sales came in at 382,100 tonnes. Sales need to average 431,000 tonnes each week to reach the USDA forecast. Wheat posted a substantial gain versus corn today in moderately active trade by spreaders.

December Oats closed down 1 1/2 at 264. This was 6 off the high and 1 up from the low.

Soybean Complex Market Analysis for 7/22/2010

August Soybeans finished 3/4 higher at 1016, 10 off the high and 7 1/4 up from the low. November Soybeans closed 1 higher at 979 1/2. This was 7 1/4 up from the low and 11 1/2 off the high.

August Soymeal closed 3.1 lower  at 300.2. This was 1.7 up from the low and 5.4 off the high.

August Soybean Oil finished up 0.64 at 38.9, 0.76 up from the low and 0.33 off the high.

November soybeans saw 2-sided trade overnight and again in the day session. The trend overnight was higher, but during the day session it was lower. Spreaders reported moderately active trade in the meal/soy oil spreads today and in soybean/corn spreads with one analyst noting that today was an adjustment day after the soybean and corn markets ran out of fresh positive price news. In fact, one analyst expressed concern over recent forecasts of South American soybean production that have the 2010/11 Brazilian crop at 70 million tonnes or higher. The USDA currently projects Brazil’s 2010/11 crop at just 65 million tonnes. The analyst noted that if the higher private estimates are correct, this could raise next year’s world ending stocks well above the record level of 67.76 million tonnes that the USDA projected on its July supply and demand report. Traders said that today’s early gains stemmed from a sharp rally in crude oil and a lower dollar. They added that gains in soybeans were limited by a lower than expected monthly crush estimate and the South American supply outlook. Old crop export sales in soybeans continue to run ahead of the USDA’s export projection for 2009/10. Net soybean sales came in at 111,800 tonnes for the current marketing year and 1,115,400 for next year for a total of 1,227,200. This takes cumulative sales to 101.5% of the USDA forecast for 2009/2010 versus a 5 year average of 99.7%. Net meal sales came in at 100,400 tonnes for the current marketing year and 35,400 for next year for a total of 135,800. Meal sales need to average 119,000 tonnes each week to reach the USDA forecast. Net oil sales were just 900 tonnes for this year. Oil sales need to average 10,000 tonnes each week to reach the USDA forecast. The USDA also announced a sale of 110,000 tonnes of soybeans to South Korea this morning for 2010/11 delivery. The Census Bureau estimated the US crush rate for June at 129.2 million bushels, about 2-3 million below trade expectations. Soy oil stocks were estimated at 3.547 billion pounds, up slightly from 3.468 billion at the end of May.

Corn Market Recap for 7/22/2010

September Corn finished down 3 1/4 at 376 1/2, 2 1/2 up from the low and 10 1/2 off the high. December Corn closed down 3 1/4 at 390 1/4. This was 2 1/4 up from the low and 10 1/2 off the high.

December corn pushed higher overnight and on into the first minutes of the day session today, but the market sold off over the remainder of the day, pushing below the overnight lows prior to the close. Traders said that early support came from a sharply sharply higher crude and lower dollar as well as a surge in wheat to start the day. However, ideas that this week’s hotter weather may not be as damaging as first thought, appeared to generate profit taking by specs. Basis levels eased at the Gulf today in light demand. This week’s export sales were slightly ahead of expectations in corn at 614,100 tonnes for the current marketing year and 540,900 for next year for a total of 1,155,000. Japan was the biggest buyer in old crop and China was the biggest buyer in new crop at 304,800 tonnes. As of July 15, cumulative corn sales stood at 102.0% of the USDA forecast for 2009/2010 versus a 5 year average of 97.8%.

September Rice finished up 0.155 at 10.135, 0.035 up from the low and equal to the high.

After reading ï»¿today’s review, traders might want to take a peek at the commercial traders momentum.  The Commercial Trader momentum can be tracked by using the Commodity Futures Trading Commission Commitment of Traders reports.  Our idea is that, in a value driven commodity futures market no one knows fair value like the people who produce it or, have to use it.  In fact, it is precisely their sense of value that provides the commodity market’s rhythmic meanderings that swing traders love so much.  Let’s face it, producers know when their product is overvalue and it should be sold just as well as end line users know when they should be stocking up at low prices.  Therefore, trader should be able to incorporate this valuable information into their future market education.

The daily commentaries provide an analysis of the factors that influenced price activity, a recap of any reports released that day, a rundown of each commodity’s traded price activity, and a look ahead at the schedule for the next day.  Market commentaries for soybeans, corn, wheat, silver and gold are provided by CME Group.   The information in the Market Commentaries was obtained from sources believed to be reliable, but we do not guarantee its accuracy. Neither the information nor any opinion expressed therein constitutes a solicitation of the purchase or sale of any futures or options contracts.

Andy Waldock publishes this blog.  Andy Waldock is a financial advisor, analyst, broker, asset manager and traderfor Commodity & Derivative Advisors, located in Sandusky, Ohio.  As a result, Andy Waldock may have positions for himself, his relatives, or his customers in any commodity future market discussed. The blog is meant for educational purposes and to develop a discussion among those with an interest in the commodity future markets. The commodity markets employ a high degree of leverage and commodity trading  may not be suitable for all investors.  Investing in the commodity futures could result in considerable risk.  If you are interested in reading other published articles, commenting  on his writings or subscribing to Andy’s blog, please visit http://blog.commodityandderivativeadv.com, or if you have any questions, please call 1-866-990-0777.