TRADING COMMODITY FUTURES AND OPTIONS INVOLVES SUBSTANTIAL RISK OF LOSS AND MAY 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.
The USDA's December World Agricultural Supply and Demand Estimates (WASDE) report came and went almost without notice. As with many December reports this year saw zero changes on the domestic balance sheet for corn. So what now?
The December WASDE was uneventful to say the least. The lack of changes on the supply side should have been expected as the USDA does not change their supply outlook in December. However, the trade was a little worried that the USDA would continue their trend of lowering corn demand. They did not and I think that could be a positive for corn right now.
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Now the trade will start getting ready for the holiday season and the end of the calendar year. However, as we go to countless gatherings and spend precious time with family, we will also start to think about what changes may come on the January report where we could see some dramatic changes in production. The corn market could have a friendly tone as many analysts will be looking for lower production, especially after all the talk of low test weights during harvest.
The bearish demand story may have peaked as well. Corn exports seem to be finding some traction lately. This is not terribly surprising as the US dollar has backed away from highs. This is also the timeframe that South American stocks begin to thin out before the current crop is harvested. The Black Sea area has been a big competitor this year as well, but they could also begin to slow down.
No changes on the December corn balance sheet might have been good news for the corn market. Positive seasonality and bullish thoughts on smaller production might allow corn to drift higher in the next few weeks. December is a wonderful time to be with loved ones, but also might be a good time to keep one eye on the market for selling opppertunities.
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Give us a call if you would like more info on the strategies we are using or if you would like to set up an account to put a plan in action. Ted Seifried - (312) 277-0113. Also, feel free to give me a call or shoot me an email if you would like to talk about your marketing plan, the markets, weather, or just to visit.Find me on twitter - @thetedspread
March Corn Daily Chart:
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 [email protected]
Additional charts, studies, and more of my commentary can be found at:http://markethead.com/2.0/free_trial.asp?ap=tseifrie
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.v