Beans were lower last week-note the big break on October 2nd after the narrow range/doji bar on the 10-1. They formed a swing low at 931 on the Third, and gave another narrow range breakout signal for Friday. I’ve liked the short side recently-the US crop forecasts are getting bigger, and the Dollar has firmed (making US exports more expensive), so I sold the breakout down, at 945. They followed through down last night, making a low of 931.50. As this was a double bottom with last week’s low, and they appeared to be bouncing off that level, I covered the short, and planned on re-entering the market if that double bottom was taken out.
They did resume the selloff, breaking the double bottom, so I’m short again. As you can see in the chart below, the 40 day MA (a good one to follow in the grains) at at 916.50, and a 50% retracement of the August/September rally is 911, so those will be my profit targets for this trade.
