Grain futures rallied sharply today, but the “adrenalin rush” cooled off after the opening. There was no surprise in USDA’s corn and wheat ending stocks estimate, but traders were caught off guard by the reduction of soybeans to 185 MB. However, profit taking developed around mid session creating reversal patterns in corn and wheat. The grain markets, along with the metals, are becoming chaotic and it will get worse. Unfortunately, when speculators become the driving market force, it generally leads to a meltdown. It tends to occur when traders are the most bullish. I do not think that we have reached that point in the grains, however, when they peak, it will likely be from the result of outside forces, such as the economy, or a blow off in gold.
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