Monday, August 3, 2015

UPDATED--Commodities: "Bloodied hedge funds return to ag selling with a vengeance"

Updated with earlier stories, below.
Original post: 
 
Corn     376-4 down 4-6
Wheat  499-0 down 0-2

From Agrimoney a belated Quote of the Day:
Hedge funds, having been bloodied by buying grains as the market tumbled, followed up with widespread selling in ags, turning more bearish on soft commodities and livestock as well as the likes of corn and wheat.

Managed money, a proxy for speculators, slashed its net long position in futures and options in the top 13 US-traded agricultural commodities, from cotton to cattle, by nearly 135,000 contracts in the week to last Tuesday, according to data from the Commodity Futures Trading Commission regulator.

The cut in the net long - the extent to which long positions, which profit when values rise, exceed short bets, which benefit when prices fall – was the second largest over the past two years.

And it came as hedge funds reversed their optimism on grains which appears to have caught them out dearly, in raising long positions even as corn, for instance, earlier this month suffered its worst week in a year.
Investors 'astonished'
Indeed, the extent to which speculators were wrong-footed surprised many investors.
"There have been times over the last 10-12 years when the professional investors have picked up on signs of large market movements way before the commercial trade, but this last two or three months has not seen them at their finest," said traders at a major European commodities house.
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