Questions you should be asking!
Sep 21, 2009
I’ve been calling brokerage clients all day saying this is the final week to be selling. It’s not that I believe a reversal is in store. In fact I would say the odds are about 80/20 that we will be significantly lower in prices over the next 45 days. It’s just I don’t want clients who are unsold calling in a panic wanting to sell corn for the last 25 to 30 cents down in late October to early November. So again, it’s time to make the hard decision. Sell it now or sit and wait until April or May and hope for a weather scare or better than expected demand to bail out prices.
Starting next week we will be asking the following questions and trying to figure out our game plan, I do encourage any comments from clients about the follow questions.
- When is the expected time that one should expect a low?
- How far will prices have to decline to result in the demand prospects the USDA have suggested?
- For producers who already have December corn sold, when should they roll forward to capture carry?
- What level of upside risk is there from the fall lows to spring highs?
- Should this upside risk be defended or simply accepted?
- Does one sell out-of-the-money puts to value enhance the 2009 or 2010 sells?
- What’s one position on basis risk going to be if inventory is stored?
- Watch the trend in the dollar, oil and the equities for strength or weakness in regards to commodities.
- Finally, at what value should feed buyers or clients desiring a speculatively long futures position be willing to enter the market?
- What indicators should be used and how much emphasis should be taken on predicting a bottom or signal a buy?
I know there are more issues but these are the top one’s I’m watching. Again, I will be talking a lot about these issues in the upcoming weeks. I look forward to your comments and issues you may be watching or that I’ve missed. Send us a message at firstname.lastname@example.org or email@example.com or call 1-800-832-1488.
BEFORE TRADING, ONE SHOULD BE AWARE THAT WITH POTENTIAL PROFITS THERE IS ALSO POTENTIAL FOR LOSSES, WHICH MAY BE VERY LARGE. YOU SHOULD READ THE “RISK DISCLOSURE STATEMENT” AND “OPTION DISCLOSURE STATEMENT” AND SHOULD UNDERSTAND THE RISKS BEFORE TRADING. COMMODITY TRADING MAY NOT BE SUITABLE FOR RECIPIENTS OF THIS PUBLICATION. THOSE ACTING ON THIS INFORMATION ARE RESPONSIBLE FOR THEIR OWN ACTIONS. ALTHOUGH EVERY REASONABLE ATTEMPT HAS BEEN MADE TO ENSURE THE ACCURACY OF THE INFORMATION PROVIDED, UTTERBACK MARKETING SERVICES INC. ASSUMES NO RESPONSIBILITY FOR ANY ERRORS OR OMISSIONS. ANY REPUBLICATION OR OTHER USE OF THIS INFORMATION AND THOUGHTS EXPRESSED HEREIN WITHOUT THE WRITTEN PERMISSION OF UTTERBACK MARKETING SERVICES INC. IS STRICTLY PROHIBITED. COPYRIGHT UTTERBACK MARKETING SERVICES INC. 2009.