No doubt this was not the kind of return from Easter producers were looking for. But, consider the following and perhaps the glass is half full:
- Corn, Soybeans, and Wheat are all approaching long term contract lows,
- Relative Strength Index (RSI) measurements have reached oversold conditions.
- Maximum pressure has been seen previously in the days leading up to end of month and First Notice Day (FND for May contracts is Tuesday, April 30),
- Large funds are already historically short with rainy weather ahead the next 10-15 days
Folks with corn in storage bins are seeing the national average basis +9^4 cents better than average. If conditions in your area reflect this, consider the still large old crop stocks and what might occur if a CBOT rally takes place. If you are comfortable with margin in a brokerage account, perhaps there is an opportunity to sell or contract physical bushels and reown/replace the bushels on paper with futures.
The major headwind continues to be the strengthening US Dollar, which posted a fresh two year high today. This has the potential to keep a lid on exports as US goods may appear more expensive in currency terms compared to Black Sea and South America supplies.
Contact your broker to discuss your trading or hedging plan!
This article originally appeared in the Technical Ag Knowledge Newsletter “The Glass is Half Full **VIDEO Chart Analysis**” at 04/25/19 03:34:30 PM Central Daylight Time.
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