That Was Fast

Bean prices broke lower as I expected them to.  Already, the option I had explained on the opportunities page which was worth .20 at the time is now worth .292 cents.  That is the nature of options and why orders need to be placed ahead of big moves.  Once the train leaves the station, it becomes extremely difficult to find a safe place to jump on.

You can see from the chart below that we had a breakdown of support.  I am anticipating that this will end with prices in the $12.00 area, based on fibonacci extensions which prices seem magically drawn to.  At that time, I would expect the CCI will then be saying it is time to sell the puts, or to then adapt a bullish options strategy (Selling Puts) to collect more premium.  My position would then become more bullish for the reasons I explained earlier this week.

The bear flag that I showed on the 26th post seems to be happening.  The coiling effect that I explained typically creates moves that are powerful once they begin moving. 

To remind you, the catalyst for this move is not fundamental agricultural related news, but news from the FOMC meeting this week which triggered a huge dollar rally.  I wrote that this would happen back on  Saturday.  Despite all the fundamental news coming from the agricultural news services, it was just a massive money flow from commodities back into the dollar.  When this rally is over, we should have a nice rally into next year as the dollar falls into its 3 year cycle low.  This will provide the bulk of our opportunities for contracting grain.