Jul 28, 2014
Home| Tools| Events| Blogs| Discussions Sign UpLogin


Hedging Corn and Soybeans

RSS By: Howard Tyllas, AgWeb.com

Howard Tyllas is currently a member of the Chicago Board of Trade and registered with the Commodity Futures Trading Commission as a floor broker and as a Commodity Trading Advisor.

December 2012, 2013 Corn Daily Numbers & Trade Ideas 9/27/12

Sep 28, 2012

Sign up: Free Learn a better way to hedge for farmers

Are you tired of listening to the same BULL ****, and services that do not have a plan if the market goes down instead? Hedge means to take risk off the table, and my service has all producers 100% hedged and they do have most of the upside unhedged (if we can rally for whatever reason). Hedge with a Pro and option expert who has been trading grains for 36 years.

Want to know

Sign up: Free 1 Day Trail of Daily Numbers & Trade Ideas

This report was sent to subscribers on 9/26/12 3:40 p.m. Chicago time to be used for trading on 9/27/12.

December 2012 Corn

After the close recap on 9/27/12: My pivot acted as resistance and was 7.27, .00 1/4 from the actual high, and my support was 7.12 1/2, .00 3/4 from the actual low.

December 2013 Corn

After the close recap on 9/27/12: My pivot acted as resistance and was 6.22, .00 3/4 from the actual high, and my support was 6.01 1/2 FG, .05 1/4 from the actual low.

All charts and numbers for 9/28/12 have already been sent to subscribers at 3.30 pm .

December 2012 Corn

7.44 ¾
7.41 ½
-----------7.27 Pivot
7.12 ½
7.04 FG

5 day chart.... Down from last week same day
Daily chart ... Down
Weekly chart ... Up
Monthly chart .... Up 6.22 is the 200 DMA
ATR 17 ½ Ex. Oversold 3%


For 9/27/12: Bracket line above is resistance; bracket line below is support.

Downtrend line is the line in the sand for staying short, a close above the line the bulls regain control.

In my daily December 2012 corn numbers on Wednesday my pivot acted as resistance and was .01 ¾ from the actual high; my support was .04 ¾ from the actual low.

December 2013 Corn


6.37 ¾
6.30 ½
-----------6.22 Pivot
6.13 ½
6.01 ½ FG

5 day chart.... Down from last week same day
Daily chart ... Sideways
Weekly chart ... Up
Monthly chart .... Up 5.74 is the 200 DMA
ATR 11 ½ Ex. Oversold 2%

For 9/27/12: Newly drawn downtrend line is the line in the sand for staying short, a close above the line the bulls regain control. Gap at $6.01 ½ is support, and then the lows of July.

In my daily December 2013 Corn numbers on Wednesday my resistance was .01 ¼ from the actual high, my support was .04 ½ from the actual low.

9/27/12:

Grains: Downward spiral continues until support is found. The daily numbers and charts clearly point to where those support levels are. Never too late to hedge the 2013 crop or you can wait for the report which could produce a limit up or down move. I do not expect too much movement today, last chance to adjust your position before the report. Exports numbers today could be worth a reaction for a bias for the day.

Consider buying back some cheap calls or spreads today for a "what if" bet if the market can rally, so you are free to sell something else. The winner does not win and the loser gets killed, so buying far out of the money options could lose value even if the market closes up $.10. Do not expect a payoff unless the market can rally at least $.20, and then you need to sell a closer to the money call to make it worthwhile. Since most are long the $8 puts, you would need to buy back the $8.50 or higher calls and on a rally sell the $8.10 calls.

"I am still bearish longer term and prefer to take the sell signals, and risk $.05 in corn and $.07 in soybeans using a stop to protect any idea".

9/26/12: Grains: Corn is bleeding now with 4 days in a row of lower highs as it tries to hold support, but unless it can get above $7.60 lower prices is inevitable. 2013 corn needs to get above $6.46 in order to avoid the same fate. Friday should propel corn to its resistance numbers just mentioned, or clearly take out supports and head for the next support level. Very low volume this week does not help the bull case. More sideways to lower action should be seen until Friday.

Soybean bulls are looking at another week of lower prices, and the longer the bull is waiting for a corrective rally, the more trouble they are getting themselves into. Knowing we traded above $17.60 7 days ago would not comfort me if I was a bull, and I certainly would not have put myself into a position that could lose over $1.50 and not do something to end a losing trade. The only good news for the bull is that the market held the uptrend line support, but if that goes $15 is the next major support just above the gap at $14.74 ¾.

Time will tell how much supply was produced this year, and if we go over the fiscal cliff, or if the dollar gets really strong due to war like or worse conditions, or another economic meltdown like in 2008. Those are "what if's" that I respect and you should too, I would not be here writing to you if I did not avoid positions that can lead to losing everything. Like life insurance, I do not mind paying for security, because that takes away stress from the bigger picture, and as long as I am alive the money you make should more than pay for the insurance and then some. The alternative is that you are happy your spouse collected the insurance. Most would tell you that they would rather see you alive and pay the insurance. Locking in income and making even 50% of any move up makes more than sense to me than not hedging or not locking in what the market gave you, and the gamble is what the insurance (put protection) would have given you. The "what if" for the upside at this point in time is a shortfall much less than current expectations, but remember, 118 BPA or less was the guesstimate when corn was still deteriorating, and the high was $8.49, so use common sense and logic when it comes to your expectations for how high corn could rally and what it takes to get it back up there. I know some are calling for $10 corn still; I want to ask them what would it take to get it there?

This is the first year in my 5 years of service that I have been recommending hedging next year's crop before December's end. It is the price that attracts me to "lock in" something, and you know the things that could make it go up or down a few dollars from here. That is not an issue, what is relevant is the current price equates to a huge income with an average trend yield for your farm. You can "bake" in any upside and downside you want, (Subscribe Now!) I feel is a bargain for what you get. Expect to pay....

2013 soybeans should also be hedged for at least $1 protection, and... Subcribe Now!

I am still bearish longer term and prefer to take the sell signals, and risk $.05 in corn and $.07 in soybeans using a stop to protect any idea.

9/25/12: Grains: Corn chart is still pointing to lower prices after another "jab" below the support of $7.39 on Monday. 2013 corn is still in a sideways pattern at a support level. I am still in bear mode and would rather take the sell signals at resistance than the buy signals.

Soybeans tested the key uptrend line support of $15.87 and held. This is the support level we were looking at the bottom of my parameters.

I said everything there is to be said last week, and I am still bearish longer term, but nothing changed to alter my call for trading within the obvious chart parameters for now. I want to continue to day trade the numbers without bias today and risk now only $.05 in corn and $.07 in soybeans using a stop to protect.

Want to know what I think for tomorrow and going forward?

The markets now covered daily are Soybeans, Corn, and S&P's.

HowardTyllas Daily Numbers & Trade Ideas is designed to help you plan your trading strategies for the coming day.

$199.00 USD for each month, renewable monthly

HowardTyllasDaily Numbers & Trade Ideas $ 199.00

If clicking on the above link does not work please copy and paste the following in your browser:

https://www.paypal.com/cgi-bin/webscr?cmd=_s-xclick&hosted_button_id=D5MG7VPCUWW2N

Howard Tyllas

Put yourself in a position to make money, use the daily numbers service!

Email: dailynumbers@futuresflight.com
http://www.futuresflight.com/

Tel.1-312-823-9189

Disclaimer: No guarantee of any kind is implied or possible where projections of future conditions are tempted. Futures trading involve risk.In no event should the content of this be construed as an express or implied romise, guarantee or implication by or from Howard Tyllas, that you will profit or that losses can or will be limited in any manner whatsoever. No such promises, guarantees or implications are given. Past results are no indication of future performance.


 

Log In or Sign Up to comment

COMMENTS

No comments have been posted, be the first one to comment.
 
 
 
The Home Page of Agriculture
© 2014 Farm Journal, Inc. All Rights Reserved|Web site design and development by AmericanEagle.com|Site Map|Privacy Policy|Terms & Conditions