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With big moves happening the day before, I expected cattle, hogs, bean oil and sugar all would take it on the chin and reverse. Although the reversal started in the overnight markets last night, I decided that I was going short either lean hogs or bean oil today.

Before I could execute a short trade this morning, I wanted to ensure that I got out of the long live cattle trade from the night before.

As mentioned, the cattle market moved lower the whole night, and when it came to the day session it seemed to accelerate to the downside. I already had my stop positioned at 87.775 and was filled on that order for a loss of $130.00 dollars (including commissions and fees)

I figured that bean oil, which opens about 20 minutes later than cattle and hogs would have the same fate, especially since bean oil probably move the highest out of the four markets that I watch.

Knowing that, I was set to short 1 BOH9 @ the open. Prior close for BOH9 (March 09 Bean Oil) was 36.82 after making a high of 37.55 that same day.

If I got in, my target was going to be 35.75 initially, but would have to see how the market behaved if and when we got down there.

I was right.

I sensed that this could be a fast market downward considering the big moves that bean oil had been making earlier in the week. I knew that if I wanted a chance to make a small profit I would have to act quickly.

Another good call. Bean oil gapped down to open at 36.70, but was soon down below 36.50 before my fill came back at 36.45. The market quickly headed down to 36.13 and then proceeded to trade slowly higher for most of the day session.

I had decided that I was not going to hold this position overnight, since this particular market was strong to the upside earlier in the week.

I ended up getting filled on my order to buy back 1 bean oil at 35.92 for about a $300 dollar profit.

Let’s watch tonight’s video: