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Weather and Markets Remain Volatile

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Weather and Markets Remain Volatile

Weather markets are notoriously fast paced, highly volatile, and unpredictable. This year, the pace at which we are seeing changes in the weather and market direction is even more fast paced, says Jim Bower with Bower Trading. “I can’t remember a time when, on a consistent basis, the weather forecast has changed so quickly,” he stated. According to Bower, normally when you get a forecast it is good for 12 to 36 hours, but this spring the forecast has been changing almost hourly.

Bower stated that the large commodity funds that have such a large market impact have been adding to the market volatility by changing their trading positions every time there is a change in the weather forecast.

Bower said that, as we move into August, the focus will move from corn to soybeans, “At Bower Trading, we are focusing more on soybeans as we move into August, the key time frame for yield for soybeans. The kind of movement we get in soybeans will have an impact on the corn market as well.” He added to keep an eye on the spread between the deferred soybean months and the nearby, “The spreads are the language of the market. Sometimes the spreads will tell you ahead of time which way the market is going to move before it does.”

For more market strategy information, contact Bower trading at 800-533-8045 or bowertrading.com.

This material has been prepared by a sales or trading employee or agent of Bower Trading Inc and is, or is in the nature of, a solicitation. This material is not a research report prepared by Bower Trading Inc. By accepting this communication, you agree that you are an experienced user of the futures markets, capable of making independent trading decisions, and agree that you are not, and will not, rely solely on this communication in making trading decisions.

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