I just put out a new podcast. We go over why I think the grain markets are getting oversold and why we expect a seasonal bottom in late August/early September. We also talk about the deep discounts cattle and hog futures have when compared to cash prices. Finally I go over crude oil and why I continue to be bearish when we trade over $50.
Turner’s Take Podcast: August 14, 2017 | Grains Oversold
CORN | After the USDA report we estimate corn yields eventually come in at 166 by the end of the year. That puts our projected carryout at 1.950 billion bushels. If true we expect Dec Corn to be range bound between $3.60 and $3.95. Farmers should look to sell straddles for income when we are in the middle of the range. We like selling put spreads on dips to $3.60 and lower. We like selling call spreads on rallies to $3.90. With harvest upon us and large US old crop stocks and large global stocks, we see corn trading in range for the next couple of months.
Dec Corn
HOGS | There is a lot of talk about all the supply coming to the hog market but cash and pork belly prices remain high. As August comes off the board October hogs will be the front month. Many in the trade thing Oct Hogs should be 5 to 10 lower but cash is currently 25 higher! We like selling October Hogs on rallies but we need to see the cash price make a run at 80 and lower.
Oct Hogs
Try Turner’s Take Market Alert – for 30 Days
Turner’s Take Market Alert – Trial - Turner’s Take Market Alert includes Daily Updates and an Intraday Trade Recommendation service for Daniels Trading clients.
Risk Disclosure
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.
