Is 10 dollarCom Coining? - It's likely under one scenario, but a decrease in demand could solve supply woes and slow a rally

摘要

Toward the end of May, I was feeling pretty good about my projection last fall of 6.50 dollar December corn. My analysis was based on the idea that ever-growing demand would continue to eat into the record production of 2007; 2008 acreage would decrease, creating concerns over new-crop supplies; and the market could face a weather scare in the first half of the new year, leading to the high. Lo and behold, all three factors played out and drove the December 2008 contract to a high of 6.55/4 dollar onMay 9. At that point the market seemed to run out of gas—or ethanol, if you will—and began to sell off. By the last week of May, the contract was testing support near 6 dollar. Traders were keenly aware a substantial break of this support could lead to wide-scale long liquidation that could culminate with an extended sell-off back to near 5 dollar.