Apr 18, 2014
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The Grain Report

RSS By: Sean Lusk, AgWeb.com

This is Tim Hannagan it's Friday, April 11. Our first crop condition report of the year for wheat came out this week and will come out each Monday at 3 PM central time. This report is leaned on heavily by large traders to determine whether the crop is getting better or worse on yields. This first report showed 35% of the crops in the Western wheat states are in good to excellent condition, down 1% from 36% a year ago. A good crop rating is  65%. When this crop went dormant the last crop condition report November 24, 2013 showed 62% in good to excellent condition. The 27 percentage point drop was the largest ever over a winter period and the worst for this time of year in the last 12 years. Two main reasons were the drought and the polar vortex. This winter subzero temperatures were consistent and often and caused a lot of stress and winter kill in the young wheat seedlings lying dormant. Key states to follow are number one wheat producing state Kansas, then Texas, Nebraska, and Colorado. The key to trading now is to follow one weather report at a time one week at a time. The current forecast by WXRISK.com the AG weather site sees rain falling on the eastern side of those major states we just noted. Should this system track farther east over the weekend taking the rain out of the western wheat belt, look for a higher open Sunday night but should the system hold as projected, followed by another rain system, with even more rain called for the following Thursday and Friday we should expect May wheat to break 6.52 support and test 6.44 major support before short covering or profit-taking starts. This first-rain system begins Saturday, Sunday, and Monday and then a second system starting next Thursday and Friday. Although the rain is bearish for wheat, it's brings light support to corn, as  the rain being forecast across the Midwest and the cold temperatures, look to delay fieldwork being done in the Midwest and planting being done in the southern Delta. We don't expect a big corn rally off the forecast but we do expect corn to hold its support at 4.94. Beans of course are planted later so it’s  not as concerned about planting delays at this point but more concerned about the softening demand with Brazil  noting that China has canceled more beans shipments which may be re-purchased by the US to make up for some of our shortfall on ending stocks. Technical’s read like this. May wheat resistance is 6.68 then 680 with support at 6.52 and 6.44. May soybean support is 14.55 then 14.20 with resistance at 15.15. May corn resistance is 5.14 support 4.94 then 4.88.

For those interested I hold a weekly grain webinar each Thursday at 3pm. I cover everything related and pertinent to the grain market in detail. It is free for anyone who wants to sign up and link for sign up is below. If you cannot attend live a recording will be sent to your email upon signup.

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DAN BURKE'S DAILY OPTION RUN 09/18/13

Sep 18, 2013

DAN BURKE'S DAILY OPTION RUN 09/18/13

GRAINS

MACRO OUTLOOK:  All grains moved higher today.  The Nov beans didn’t even test 1335 again.  In my opinion, this is bullish.  I was hoping to onboard at 1280 as a long, but the price action seems to understand my intentions.  I am keeping an eye on the 1408 level as a bull target.  In the Dec corn, prices moved sideways with exhaustion.  I believe there are too many shorts in dec corn right now.  Resistance can be found at 470.  I believe the opportunity will be found in shorting this dec corn contract if there is a move up to, or through, this 470 level.  In dec wheat, the daily chart is showing signs of a technical reverse head and shoulder formation.  I believe this is bullish.  Please keep in mind, while looking below, that commissions and fees are not included in the cost of the option.

SOYBEAN HEDGE OPPORTUNITIES

PRODUCERS

OCT '13

NOV '13

JAN '14

MAR '14

STRIKE

PRICE

COST

STRIKE

PRICE

COST

STRIKE

PRICE

COST

STRIKE

PRICE

COST

1320P

5.0

250.0

1310P

21.6

1087.50

1220P

12.7

643.75

1200P

16.2

812.5

1300P

1.7

93.75

1300P

18.4

925.0

 

 

 

 

 

 

1290P

1.3

68.75

1290P

15.5

781.25

 

 

 

 

 

 

END USERS

OCT '13

NOV '13

JAN '14

MAR '14

STRIKE

PRICE

COST

STRIKE

PRICE

COST

STRIKE

PRICE

COST

STRIKE

PRICE

COST

1380C

5.2

262.5

1400C

20.1

1006.5

1540C

10.4

525.0

1600C

16.4

825.0

1390C

3.5

181.25

1450C

10.4

525.0

 

 

 

 

 

 

1400C

2.4

125.0

1490C

6.3

318.75

 

 

 

 

 

 

 

CORN HEDGE OPPORTUNITIES

PRODUCERS

OCT '13

DEC '13

MAR '14

JUL '14

STRIKE

PRICE

COST

STRIKE

PRICE

COST

STRIKE

PRICE

COST

STRIKE

PRICE

COST

450P

3.6

187.5

450P

16.0

800.0

410P

10.3

518.75

400P

5.1

256.25

445P

2.3

118.75

445P

13.7

693.75

 

 

 

 

 

 

440P

1.3

68.75

440P

11.7

593.75

 

 

 

 

 

 

END USERS

OCT '13

DEC '13

MAR '14

JUL '14

STRIKE

PRICE

COST

STRIKE

PRICE

COST

STRIKE

PRICE

COST

STRIKE

PRICE

COST

465C

3.0

150

480C

10.3

518.75

550C

16.3

818.75

570C

4.3

218.75

470C

1.7

93.75

490C

8.0

400.0

 

 

 

 

 

 

475C

1.2

62.5

500C

6.0

300..0

 

 

 

 

 

 

 

WHEAT HEDGE OPPORTUNITIES

PRODUCERS

OCT '13

DEC '13

MAR '14

JUL '14

STRIKE

PRICE

COST

STRIKE

PRICE

COST

STRIKE

PRICE

COST

STRIKE

PRICE

COST

635P

4.0

200.0

630P

18.0

900.0

580P

9.3

468.75

550P

11.0

550.0

630P

2.4

125.0

620P

13.5

681.25

 

 

 

 

 

 

625P

1.4

75.00

610P

10.0

500.0

 

 

 

 

 

 

END USERS

OCT '13

DEC '13

MAR '14

JUL '14

STRIKE

PRICE

COST

STRIKE

PRICE

COST

STRIKE

PRICE

COST

STRIKE

PRICE

COST

655C

2.2

112.5

660C

16.4

880.0

770C

8.5

431.25

820C

10.2

512.50

660C

1.3

68.75

670C

13.5

681.25

 

 

 

 

 

 

665C

.7

43.75

680C

11.1

556.25

 

 

 

 

 

 

RISK DISCLOSURE: THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES AND OPTIONS TRADING.  THIS REPORT IS A SOLICITATION FOR ENTERING A DERIVATIVES TRANSACTION AND ALL TRANSACTIONS INCLUDE A SUBSTANTIAL RISK OF LOSS. THE USE OF A STOP-LOSS ORDER MAY NOT NECESSARILY LIMIT YOUR LOSS TO THE INTENDED AMOUNT.  WHILE CURRENT EVENTS, MARKET ANNOUNCEMENTS AND SEASONAL FACTORS ARE TYPICALLY BUILT INTO FUTURES PRICES, A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES AND OPTIONS CONTRACTS.

Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The views and opinions expressed in this letter are those of the author and do not reflect the views of Walsh Trading Inc. or its staff.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Walsh Trading Inc. Copyright © Walsh Trading Inc.

In technical analysis, investors and analysts study charts of trading patterns and prices to forecast changes in a security, commodity, currency or index. Support refers to an area on a chart where buy orders may be clustered. Resistance is an area where there may be sell orders.  Fibonacci retracement is named after a 12th century Italian mathematician and based on the theory that prices rise or fall by predictable amounts after reaching a high or low.

For more market information, Dan can be reached at 312.957.8248 or via e-mail at dburke@walshtrading.com.

Stay Green!  Go Paperless and fill out this online application in order to trade Futures and Options------https://accountforms.rcgdirect.com/

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