The Ted Spread
Ted is the Chief Market Strategist and Vice President in charge of the Zaner Ag Hedge Group and specializes in agricultural hedging employing various strategies using futures, futures spreads, outright options and option combinations. He believes it is paramount to be able to use different strategies to adapt to market conditions. Ted works with large to mid size grain and livestock producers and end users in North, Central and South America.
Corn Falls Under Pressure as Weather Agrees with Planting
May 16, 2013
TRADING COMMODITY FUTURES AND OPTIONS INVOLVES SUBSTANTIAL RISK OF LOSS AND IS NOT BE SUITABLE FOR ALL INVESTORS. YOU SHOULD CAREFULLY CONSIDER WHETHER TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR CIRCUMSTANCES, KNOWLEDGE AND FINANCIAL RESOURCES.
Welcome to the 100th installment of The Ted Spread! Thank you so much for taking the time out of your very busy schedule. I am also very great full for all the comments, calls, questions, encouragements and criticisms. It makes the whole thing worthwhile (I suppose calling me an idiot is better then not calling at all, Ha!)...
Corn was under pressure today as weather is finally conducive for widespread plating. The consensus is that there will be an unprecedented jump in planting progress on Monday afternoon's crop progress report. I tend to agree as everyone I have called on in the last few days has been in the field getting work done. The progress that has been made this week is amazing and once again proves that the American Farmer is the best in the world.
From where I sit, the progress this week has been staggering. I have clients all over the grain belt which is always very helpful to my analysis and to my clients, but this has been one of those special weeks where it has been really exciting to talk to everybody and get an update and in turn give updates from all over. It is a wonderful thing to get a broader perspective rather then only really knowing what's going on in my neck of the woods. It is just as wonderful to be able to pass that along as well. Without naming names or going into too much detail here are some of the stories -
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A client about 25 miles east of Springfield, IL has gotten almost 80% done of his 2,400.
Further east in LaFontaine, IN I have a client that finished his 4,100 acres yesterday, but he says most guys around him are 30% at best and going hard to get as much in before the advertised rain late weekend into early next week.
Another client near Danville, IL that is at 0% on 800 acres as of Wednesday, but going in the morning... Near Linton, ND 9,000 acres planted in less then 10 days.
Rained out in Fargo with 2,000 acres of corn to go, expecting almost 4 inches this weekend so may be switching.
Logansport, IN 35-40% as of today, looking to be done with corn before the rains late weekend.
We'll be done tonight in Delween! (IA)
From what I can tell it is wet and messy, but there are or have been opportunities for guys on the ball. I hate to be cliche, but you snooze you loose. Anyone who hesitated to get in the field is struggling to catch up.
With all of the progress being made December corn has gotten close to mid April lows and key support. There certainly are still some wet spots, so if there is more rain in the forecast Monday, or the progress report is dissapointing corn could pick up off of support again. However, if there is a lack of bullishness early next week December corn could be set to take another leg lower.
If you are looking for ideas or want to talk strategy feel free to give me a call or shoot me an email, you will find my contact info below.
CME Options On Futures: The Basics: http://www.zaner.com/offers/?page=9&ap=tseifrie
December Corn Daily chart:
November Soybeans Daily chart:
December Wheat Daily chart:
All this means that speculators should be looking for opportunities and producers need to look to lock up some prices while we have corn near $7.00 and soybeans near $14.00. Give me a call for some ideas. In particular, producers looking to hedge all or a portion of their production may be rather interested in some of the options / options-futures strategies that I am currently using.
In my mind there has to be a balance. Neither technical nor fundamental analysis alone is enough to be consistent. Please give me a call for a trade recommendation, and we can put together a trade strategy tailored to your needs. Be safe!
Ted Seifried (312) 277-0113 or firstname.lastname@example.org
Please check out my Blog at: http://tedseifriedfutures.com/
Additional charts, studies, and more of my commentary can be found at: http://markethead.com/2.0/free_trial.asp?ap=tseifrie
Futures, options and forex trading is speculative in nature and involves substantial risk of loss. This commentary should be conveyed as a solicitation for entry into derivitives transactions. All known news and events have already been factored into the price of the underlying commodities discussed. The limited risk characteristic of options refers to long options only; and refers to the amount of the loss, which is defined as premium paid on the option(s) plus commissions.
FOR CUSTOMERS TRADING OPTIONS, THESE FUTURES CHARTS ARE PRESENTED FOR INFORMATIONAL PURPOSES ONLY. THEY ARE INTENDED TO SHOW HOW INVESTING IN OPTIONS CAN DEPEND ON THE UNDERLYING FUTURES PRICES; SPECIFICALLY, WHETHER OR NOT AN OPTION PURCHASER IS BUYING AN IN-THE-MONEY, AT-THE-MONEY, OR OUT-OF-THE-MONEY OPTION. FURTHERMORE, THE PURCHASER WILL BE ABLE TO DETERMINE WHETHER OR NOT TO EXERCISE HIS RIGHT ON AN OPTION DEPENDING ON HOW THE OPTION'S STRIKE PRICE COMPARES TO THE UNDERLYING FUTURE'S PRICE. THE FUTURES CHARTS ARE NOT INTENDED TO IMPLY THAT OPTION PRICES MOVE IN TANDEM WITH FUTURES PRICES. IN FACT, OPTION PRICES MAY ONLY MOVE A FRACTION OF THE PRICE MOVE IN THE UNDERLYING FUTURES. IN SOME CASES, THE OPTION MAY NOT MOVE AT ALL OR EVEN MOVE IN THE OPPOSITE DIRECTION.