Funds net long Tuesday past

[farming101]

And Commercials are now net short....

[sumdumguy]

Farming 101 - I would be grateful if you translated the meaning of the chart that you posted.

[farmaholic]

.....and how does the "elephant" in the room affect this?

[fjlip]

Usually a BULL in China Shop...

[farming101]

SDG - Managed money or "the funds" have picked up a lot of new short positions that merchants, end users and producers have decided to put on. The swing by commercial traders was over 51,000 contracts week over week. That's a record since the Commitment of Traders reports for Canola began to be published. The funds can play the role of market facilitators but of course also hope to profit from their new positions. So, picking up a lot of long positions would indicate they think there is not a lot of risk that the price is going to slip too much. Whether it will go higher or not remains to be seen.....

[sumdumguy]

So, I understand you to say this chart is a risk thermometer. Traders put more and more funds at risk on the table when they think they will profit and pull funds off the table and move to short positions when they start feeling bearish. It measures bearishness/bullishness?

[bucket]

Someone, not me because I know nothing, has been saying since last fall that they will have to ration canola , one would think that would be bullish???

[farming101]

Yes, or maybe you could say confidence or lack of. Same thing I suppose.
This segment of traders are not usually directly connected to the actual buying and selling of the physical product. So to unwind their positions they need to find some other entity that is willing to retire their position or take on a new one. They are not hedging, they are speculating.

[Rareearth]

The spreading can cause false signals.

maybe long canola and short soy oil, or soy beans, or palm, or crude, etc?

I think this is a AI trading opportunity, with fundamental backing from the funds. No markets/commodities move alone anymore.

This does create opportunities ( higher highs and lower lows - than specific crop fundamentals would support) for those directly involved in that commodity such as farmers, traders, buyers to hedge futures or options, long or short positions.

[farming101]

Ag Canada forecasts ending stocks at 1.250 million. USDA is at 1.706 million.