Futures prices were immediately higher this morning. There was rumor abounding early this morning that a very large sale had gone off in PRC at the end of last week, with the Central Government Reserves being the buyer. The rumor will have to remain that until confirmation on the export report, however it certainly kept a firm bid to prices throughout the day.
As such both electronic futures began the day with 30 point gains across the board before the open outcry came in 30 higher. Prices were well bid out of the short covering specs, who are seeking to trim their positions down of late given the likelihood of a short term May low in place.
Around 54 cents May, the trade—in particular the co-ops– were very strong sellers, with one in particular reported to have sold over 1500 contracts. Indeed with the official AWP at 42.70, May at 54.00 is enough to produce a decent equity even at delivery to the New York contract. Spreads were actively traded today, especially the May / July around 85 points, however the overall estimated volume at 16,920 lots was quite light relative to recent days.
Tomorrow morning's spec hedge report should see some lessening of the specs overall short position. With the length of the index funds at present, the traditional specs are very short the market and represent a large % of the sensitive position in the market.
There were no notices issued, though with this morning's open interest in March still reading 3,322 lots there are still a lot of deliverable positions open, especially with just 1172 lots being issued to date.