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Home / Futures Blog / Turner’s Take | How We Are Playing Corn This Week

Turner’s Take | How We Are Playing Corn This Week

April 27, 2020 by Craig Turner

Macro Markets

Some foreign countries and US States are opening back up for business.  I guess we will find out if Flattening the Curve worked and if economies can now reopen.  The US economy will not open soon enough to save June Crude Oil from prices in the teens and probably single digits.  Keep in mind July Crude Oil comes off the board June 22.  July WTI could also be in the teens and single digits as we go into the last month of trading.  Right now it looks like August Crude has the best change of stabilizing and eventually stay in range in the $20s.

Hopefully by June all the Stay At Home orders will have been lifted but we will still see a lot of social distancing.  Crude Oil cuts in production will stay in place but demand for energy should start to rebound this summer. Any improvements in COVID-10 treatment will help to relieve the need for social distancing.  An effective vaccine will go a long way to getting things back to normal.

As long as we don’t have setbacks with coronavirus with respect to the states and nations opening back up, I think the stock market has put in a low.  We have a busy week of companies reporting earnings but they are expected to be bad and the market has priced them in for the most part.  The markets are forward thinking and reopening economies in a limited way will be perceived as bullish overall.

Reuters | Some Countries Prise Open Lockdowns

Reuters | US States from Minnesota to Mississippi to Reopen Economies

If you are not a subscriber to Turner’s Take Newsletter then text the message TURNER to number 33-777 to try it out for free!  You may also click here to register for Turner’s Take.

Emini S&P 500 (Red line 20 Day SMA, Green Line 200 Day SMA)

Grains & Oilseeds

We expect corn to be weak right into First Notice Day.  We are keeping all new crop hedges.  If you are short the old crop you can stay short until tomorrow or Wednesday.  I do want to get long July Corn on Wednesday or Thursday (May FND).

The reason we like being short into FND is cash and storage contracts for May need to be finalized by Wednesday.  These contracts either need to be priced, delivered, or storage needs to be rolled. If stocks are adequate to abundant (and they are right now) then FND has a negative price influence on the front month.  I think the selling goes too far and that is why I like to by the next month right around FND during these situation.

We will be looking to buy July Corn on Wednesday or Thursday.  We are keeping our new crop hedges.  I am only looking for a short term pop in July and we probably will want to be out by the May WASDE.

If you are interested in working with Craig Turner for hedging and marketing, then click here to open an account.  If you are a speculative or online trader then please click here. 

July Corn

Energy

I want to pass along a quick thought on Energy.  June Crude Oil is selling off as the market realizes things are not going to be better by the end of May for energy demand. We still have demand issues as refineries don’t need crude for gasoline or heating oil.  The world is still producing more crude than the global economy needs.  Those two factors keeps crude in the $20s.  What gets the front months into the teens and single digits is the industry is running out of storage.  Moral of the story is we expect the deferred months to stay in the $20s. We think the front months will be sub $20 until we see real demand outstrip supply OR the market comes up with a storage solution for excess crude oil.

If you are not a subscriber to Turner’s Take Newsletter then text the message TURNER to number 33-777 to try it out for free!  You may also click here to register for Turner’s Take.

What I’m Doing At Home

IL Governor Pritzker extended the Stay At Home order until the end of May so I am not expecting to go to be back in the Chicago office until Monday, June 1.  That means five (5) more weeks working from the home office. IL schools have also cancelled on campus classes for the rest of the academic year, which means the kids are finishing school this year with a mix of online learning and home schooling.  These are some of the things I’ve been up to for the past week

Painting My House | The weather did not cooperate much this week. It was cold, cloudy, with a little rain each day.  We got one nice day (yesterday) so I was able to complete most of the prep work.  Over the past week or two we’ve been able to replace a few boards on the house, scrape, power wash, repair some boards and sand.  As soon as we get a stretch of days of reasonable weather I am going to prime, tape, and paint. It looks like I’ll be able to get a lot done at the end of the week after work and next weekend.

Fairy Garden | My seven year old daughter has built a fairy garden under a tree in my front yard for the whole neighborhood to enjoy.  It has fairy houses, a pathway from the fairy village to our sidewalk, and now my neighbors are getting involved.

The Last Dance | ESPN is running a 10 part mini series on the 1997-1998 Chicago Bulls season.  This was the year the Bulls won their 6th and final championship. It is really good.  Some of the language is not family friendly but if you watch the series on ESPN2 they have a TV-14 edited version.  Episodes 3 & 4 were last night.  You can catch reruns on ESPN and their app.  Episodes 5 & 6 will on Sunday night.

If you are interested in working with Craig Turner for hedging and marketing, then click here to open an account.  If you are a speculative or online trader then please click here. 

About Turner’s Take Podcast and Newsletter

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Craig Turner – Commodity Futures Broker
Turner’s Take Ag Marketing: https://www.turnerstakeag.com
Twitter: @Turners_Take

Contact Craig Turner

Turner’s Take Newsletter & Podcast

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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.

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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.

Filed Under: Turner's Take

About Craig Turner

Craig Turner is a Senior Broker at Daniels Trading, author of Turner’s Take newsletter, and a Contributing Editor for Grain Analyst. Craig is often quoted in the Wall Street Journal, Reuters, Dow Jones Newswire, Corn & Soybean Digest, and also makes appearances on SiriusXM – Rural Radio Channel 80 providing commentary for the Grain and Livestock markets. Craig has also been featured in FutureSource’s Fast Break series, Futures Magazine Online, and INO.com. Mr. Turner has a Bachelors from the Rensselaer Polytechnic Institute (RPI) where he graduated with honors and has worked at the NYSE and Goldman Sachs. While at Goldman, Craig earned his MBA in the NYU Stern executive program. Learn more about Craig Turner.

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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.

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