This is a sample entry from Craig Turner’s email newsletter, Turner’s Take Weekly, published on October 22, 2014.
Turner’s Take will be divided into two products by the end of the year. There will be Turner’s Take Weekly that will remain a complimentary newsletter for anyone who wishes to receive it. The Weekly will contain my market thoughts and commentary, but it will no longer have trade recs and keep track of our positions. The Turner’s Take Daily newsletter will have trade ideas, market updates, keep track of open positions, and risk management features. The Daily newsletter will be complimentary for Daniels Trading clients with active trading accounts. If you do not have an active trading account at Daniels Trading, then there will be an option to pay for a subscription to Turner’s Take Daily. We will be providing more details on that in the coming days and weeks.
1) Soybeans: Meal leading market higher. Stopped out of SX5/SX4 bear spread with profit
Soybean meal has been leading soybeans higher along with the rest of the grain markets. It is no secret the US had very tight supplies coming into harvest, and with the harvest delays in the eastern corn belt, processors are not getting the beans then need to crush into meal. This is causing a big rally in the cash meal market, which is leading meal futures higher, which is leading soybeans higher, and finally dragging corn and wheat along with it.
If you want a very good visual of what is going on right now, take a look at Dec/Jan Meal compared to Nov/Jan Soybeans. What is going on? Meal is in short supply. Farmers are either delayed in harvest or they are so busy with harvest that they are not marketing. Either way, no beans/meal are getting moved. This is causing processors to bid up meal. In my opinion this is a very short term rally. Once farmers get the beans out of the ground and to the elevators/processors, the premium comes out of meal and the grain markets relax.
Nov14/Jan15 Soybeans: Obviously Bean have rallied, but we are still testing resistance.
Dec14/Jan15 Soybean Meal: The cash shortage has been explosive for nearby bull spreads
TRADE EXIT: Unfortunately, our Nov 15/Nov 14 soybean bear spread was stopped out with a modest profit. We were bear spread from -5 cents and stopped at -10 cents. That is a gain of 5 cents per spread or $250 per spread.
2) Soybeans vs Corn: Taking profits ahead of Soybean First Notice Day
I have been short 1 November Soybeans and long 2 Dec Corn from $3.00. We are not trading around $2.60 and up about 40 cents (+$2000 in the standard or +$400 per mini spread). With First Notice Day around the corner in Nov Beans and the rally in Meal, I want to exit with a profit and then revisit this when the Soybean market cools down. Let’s take a profit and we will come back to this idea soon.
EXIT: Buy 1 November Soybean and sell 2 Dec Corn at Market. Entry from $3.00. trading around $2.60 now. Should be close to a 40 cent gain.
1 Nov Beans – 2 Dec Corn chart:
3) Live Cattle: Bear Spread LCG5/LCZ4 from +1.000
We are bear spread Feb15/Dec14 Live Cattle from +1.000. Dec Live Cattle seems to be making a double top (see Dec Cattle chart below). The Dec/Feb spread has been making lower highs while the outright contract has been making higher highs. In my experience I put more weight into what the spreads are telling me than the what the outrights are. I think between the double top in Dec LC and the lower highs in the Feb/Dec spread that this market is due for a sell off. I don’t think the bull market is over for cattle but I do think Dec could come down back to 160 and I think this spread can trade below 0 again.
Open Position: Long Feb 15 LC and short Dec 14 LC from +1.000. Stop at +2.500 and Target -2.000.
Dec14/Feb15 LC Chart:
Dec 14 Live Cattle:
Subscribe to Turner’s Take Newsletter & Podcast
Turner’s Take Newsletter & Podcast - Turner’s Take is a complimentary weekly market commentary newsletter that covers the Grain, Livestock and Energy futures spread markets using fundamental, technical and seasonal analysis.
Futures Traders’ Guide to the WASDE
Designed exclusively for futures traders, this comprehensive guide will help you understand the USDA World Agriculture Supply & Demand Estimates For Corn, Soybeans and Wheat reports.
STOP ORDERS DO NOT NECESSARILY LIMIT YOUR LOSS TO THE STOP PRICE BECAUSE STOP ORDERS, IF THE PRICE IS HIT, BECOME MARKET ORDERS AND, DEPENDING ON MARKET CONDITIONS, THE ACTUAL FILL PRICE CAN BE DIFFERENT FROM THE STOP PRICE. IF A MARKET REACHED ITS DAILY PRICE FLUCTUATION LIMIT, A "LIMIT MOVE", IT MAY BE IMPOSSIBLE TO EXECUTE A STOP LOSS ORDER.
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.