Wednesday, September 19, 2012

Great grain bull of 2008, killed by MF rogue trader


I didn't realize it at the time but in retrospect the great grain bull market of early 2008 peaked on the liquidation of the rogue trader at MF Global which stuck the firm with a $141 million dollar loss.  The best explanation of the circumstances are in the DOJ press release:

DOJ: MEMPHIS AREA MAN INDICTED FOR CAUSING MF GLOBAL TO LOSE $141 MILLION ON UNAUTHORIZED TRADES OF WHEAT FUTURES CONTRACTS AT CHICAGO BOARD OF TRADE IN 2008

Amazing to think that at the peak of the grain bull he was short 17,181 wheat contracts on that night by the time it was limit up!  Click to enlarge all charts.



Above is that night's 1 minute chart of May Chicago wheat which he was mainly short and the volume is shown below. 

On a bigger picture time frame to understand the entire grain bull, here is some longer term perspectives,

Above is daily Chicago March wheat.

Above is 30 minute Chicago March wheat top.

Above is daily KC March wheat.

Above is the top in KC March wheat 1 minute chart.

Above is the top in KC March wheat 30 minute chart.

Above is Minneapolis March wheat, really amazing move and I got to hear some legendary stories when I was up there for the floor closing at year end. 

Above is the top in Minneapolis March wheat, 1 minute chart.

Above is the top in Minneapolis March wheat, 30 minute chart.

2 comments:

MTRDE96 said...

...i'm speechless..like that surprised cat gif...i don't even know what to say..

Pat said...

I'd like to hear some of those MPLS stories. How did Carter and Lee do that day? How many stop orders did O'Donnell have trade through him? :) Too bad there isn't some live cam footage of that day.

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