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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.

July Soybean Daily Numbers & trade Ideas for 5/24/11

May 25, 2011

This report was sent to subscribers on 5/23/11 4:00 p.m. Chicago time to be used for trading on 5/24/11. Everything is done by Howard Tyllas, no program or black box.

July Soybeans

After the close recap on 5/24/11: My resistance was .05 (but my pivot was only .01 ¾ in open outcry) from the actual high; my support was just .00 ¾ from the actual low. Results for 5/24/11:

My soybean numbers on Tuesday; my resistance was .05 (but my pivot was only .01 ¾ in open
outcry) from the actual high; my support was .00 ¾ from the actual low.

My daily corn numbers on Tuesday; my pivot acted as resistance and was .04 ¼ (.01 ½ in open outcry) from the actual high; my support was .06 from the actual low.

My daily crude oil numbers on Tuesday; my resistance was .02 from the actual high, my support was .26 from the actual low.

My daily Nat Gas numbers on Tuesday; my resistance was .020 from the actual high; my pivot acted as support and was .035 from the actual low.

My daily T bond numbers on Tuesday; my resistance was 11 from the actual high; my pivot acted as support and was 10 from the actual low.

My daily gold numbers on Tuesday; my resistance was $2.20 from the actual high; my pivot acted as support and was $2.00 from the actual low.

My daily S&P numbers on Tuesday; my resistance was 2.75 from the actual high; my pivot acted as support and was 2.25 from the actual low.

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hours before today's open outcry?

All charts and numbers for 5/25/11 have already been sent to subscribers at 5:40 pm.

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July Soybeans


13.84
--------------13.74 ½ Pivot
13.65 Uptrend Line Support

Trend
5 day chart... Up from last week same day
Daily chart .... Sideways
Weekly chart ... Up
Monthly chart Up $12.85 is the 200 DMA
ATR 30 ¾ Overbought 73%

 

soybeans 5 24 11

For 5/24/11: I continue to say "Downtrend line resists at $14.10 and the uptrend line at $13.62 supports". Notice how the uptrend line was perfect support on Friday and Monday.

In my daily soybean numbers on Monday; my resistance was .09 ½ (but my pivot was only .01 ¾ in open outcry) from the actual high; my support was .04 from the actual low.

5/24/11:

Results for 5/23/11:
Soybean numbers; my resistance was .09 ½ (but my pivot was only .01 ¾ in open outcry) from the actual high; my support was .04 from the actual low.
Corn numbers; my resistance was .02 ¼ (.01 ¼ in open outcry) from the actual high; my support was .02 ¼ from the actual low.
Nat Gas numbers; my resistance was .040 from the actual high; my pivot acted as support and was .032 (only .010 in open outcry) from the actual low.
Crude oil numbers; my pivot acted as resistance and was .09 from the actual high; my support was .38 from the actual low.
30 year T bond numbers; my resistance was 7 (only 6 in open outcry) from the actual high; my pivot acted as support and was 4 from the actual low.
Gold numbers; my resistance was $7.80 from the actual high; my pivot acted as support and was $4.70 from the actual low.
S&P numbers; my pivot acted as resistance and was 2.00 from the actual high; my as support was 2.25 from the actual low.

Grains: Spot on numbers! No chart damage, I am still friendly December corn, and for now keeping my producers from buying or extending, additional protection. The market was so strong on Sunday night gapping higher and posting nice gains, but by the time open outcry started crude oil was down sharply and the dollar was strong, and grains did not know which way to go. This was repeated throughout the day with wet weather and chart support creating buyers, and crude oil down $3 with a strong dollar creating backbone when at resistance numbers for the sellers to come out selling. Playing ping pong at settlements amplifies the 2 way action with no conviction to hold longs when at resistance thus take profits (which aids the new sellers) or when the market came down to supports the sellers had no problem to take profits (which aids the buyers). Not only do you see the moving target of price on the daily charts with here today gone tomorrow, and back once again, you are seeing it in the overnight and open outcry sessions. This generates traders to buy and sell, rather than investing and holding position for weeks. With swings that have been witnessed this year, even if you take ½ on the way up and ½ of each drawdown, you will come out much better than holding a long or short position since January 1.

Grain exports were very good on Monday... so what! This is not the time for that to be of influence in a given week when weather, funds, crude oil, and the dollar have much more credibility for market sentiment now. Planting intentions showed soybeans 41% planted with last year and the 5 year average both at 51%. Emergence was 12% versus 22% last year, with the 5 year at 19%. Soybeans have a much longer window for planting than corn, because soybeans are planted according to time lines of daylight. Corn planted was 79% complete versus 92% last year and 87% the 5 year average. Cool weather might have kept the emergence from doing better posting 45% versus 60 last year and the 5 year of 59%.

July/December corn spread having gained about $.45 in a few days but hit a wall at $.99 ¾ on Monday and reversed. July/November soybean spread gained $.40+ cents in a month and saw some profit taking.

I still think old crop highs will hold, with more underlying unknown fundamentals in the new crops that will support until unknowns become more favorable. The new crops could make a new high but will go nowhere without the old crop doing the same. I am looking for July soybeans to hold its high of $14.41 made on report day 3/31/11, and holding its low of May at $13.07 ½, and then the gap at $12.78 as Custer's Last Stand. If we break those parameters, I expect a $1 or $2 move to follow through. The Eastern Corn Belt is the big question that supports the market. $7.88 ¾ is the 2011 high in July corn, fell short on Monday making a new high for the run but closed lower which bodes well for another down day to follow on Tuesday.

I prefer to take the sell signals but would trade the numbers without bias and risk $.06 in corn and $.08 in soybeans on any trade idea using a stop to protect.

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May Your Next Trade Be The Best


Howard Tyllas

Tel.1-312-573-2699, 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.

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