A bullish planting intentions report as Ag was the complex to be in today … corn higher by nearly 5%, soybeans 3% ad wheat 5%. If trading in this arena be long as we continue to think new crop corn and soybeans are the best place to be.
Market psychology: The harami signals a change in sentiment. On the first day the shorts are comfortable and confident due to the weakness in the market as evidenced by the long black body (A). The news is bearish, so it provides encouragement and the anticipation of additional gains.
The second day's activity is not what the shorts expect, as prices open above the previous day's close and ultimately settle slightly higher than the opening, which is reflected by the small white body (B).
The traders who are still short the market, are bewildered by the market's strength and begin to question the market's inability to go lower. The shorts respond to strengthening prices by exiting the market. This begins to fuel the buying. Those who fear they've missed the buying opportunity, also find themselves chasing the market higher, as they enter additional market orders to buy before the market goes higher.
Agriculture Futures Surge On Crop Reports
http://online.wsj.com/article/SB10001424052748703806304576234683938565862.html?mod=googlenews_wsj
The price gains came even as the U.S. Department of Agriculture in a separate report said that growers will increase their plantings of most crops to take advantage of multi-year-high prices in farm commodities. Worries remain over the spring weather, with traders and analysts fearing wet weather in the Midwest and dry weather in southern states like Texas will prevent farmers from being able to replenish low supplies.
The USDA in its quarterly inventories report said farmers had 1.6% fewer soybeans and 15% less corn in storage as of March 1 than a year earlier.
