Wednesday, April 16, 2008

Transitioning to July Contracts

I've noticed that during the period in which traders are transitioning from one contract period to another, volume and liquidity suffer, and trading conditions are often less than optimal. We are in that period now. I changed to the July 08 wheat contract a few days ago. Today, I have changed my charts to the July 08 corn and soybean contracts. During this next few days, spreads will tend to be wider and trading will be somewhat erratic. I will use some caution during this transition period, which will probably last into next week. The sooner traders make this transition, the better, because the increase of liquidity in the July 08 contract periods will benefit everyone.