Disclaimer: there is risk of loss trading futures and options. Past performance does not necessarily indicate future results. This is our opinion and should be treated as such.
Why the alert?
Corn and soybeans are both sitting at some key supports where we can define our risk or get upside exposure for those who would like some.
This is an area we like re-owning some of the sales that were made higher on our Sep 1st and Sep 2nd sell alerts. Or if you are selling bushels off the combine.
There are several routes you could consider. Some of you might want to consider calls, some futures with a stop.
Every operation is different with different risk tolerance and goals. If you would like some specific recommendations, please feel free to reach out to us.
Office: (806)484-1214
CHARTS BEHIND ALERT
Dec Corn:
We sitting at the August lows and the bottom of that range we were trapped in last year.
Thus far, we have had a nice rally off the lows. We breached the August lows but are reversing higher.
There is a massive shelf of volume sitting here which we’d like to see act as support.
If we lose the August lows, there is a volume gap to the downside that we need to be mindful of.
But for now this is viewed as support.
The RSI in Dec corn is also the most oversold it has ever been on this contract. More oversold than the June lows.
So clearly we are heavily oversold here.
One last chart to show is the the front month chart.
Corn has also given back 61.8% of the yearly highs down to the yearly lows.
At the same time we are re-testing the upper end of the yearly range.
Nov Beans:
Sitting right in the golden zone down to the August lows.
As we’ve given back 50-61.8% of the rally. The most common area for a correction to end.
We had that massive volume gap to the downside. We sliced through it, and now we are back at the next volume shelf and area of high volume.
We are also re-testing the highs from July. Soybeans tend to turn old highs into new lows pretty often. The August lows came at the March highs.
The March and June lows came at the highs from last November.
So finding some life here would make sense. Ideally we’d like to hold this zone.
The last two sell offs in soybeans were right around -92 cents. So far this sell off is about the exact same size as the previous two.
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Jeremey & Office: (806)484-1214
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Email: sfrost@dailymarketminute.com
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