March soybeans surpass $12.00

March 08 soybeans breached the $12.00 per bushel price handle during overnight, pre-holiday trading. This is not unexpected, especially since the new front month contract (March 08) is priced approximately $.20 higher than the Jan 08 contract. Volume today (12/24) is relatively light, but certainly sufficient for good trading.

This is not uncommon in the financial markets. Thin volume tends to create ideal conditions for amplified movements and erratic volatility. Throughout 2004 a few years ago, the EURUSD hit its greater and greater highs, which were amplified during the light volume of December trading. In early January 2005, when normal trading volume resumed, the USD corrected and rose for most of the following year.

I have been somewhat hesitant to trade soybeans and other grains during the trading days surrounding the Holidays, but I feel that trading conditions have been excellent thus far. In the future, I would have no hesitancy to trade grains during the Holidays. Liquidity has remained strong and solid throughout, erratic price adjustments haven't appeared, and price movements have not appeared to me to be abnormal. These are all conditions that have dissipated my hesitancy, and in future years, I would eagerly place trades throughout the Holiday season. That's good, because I really like to trade, and I genuinely miss trading on holidays and during vacations.