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Esteemed Advisor

A Rare Marketing Post for the Marketing Page

This seems to be a perfect time to establish a call option position so that you can play aggressive defense on the rallies that are likely to unfold over the next 8 weeks. Just about everything is flashing oversold, perfect planting weather and conditions (hey its what I read online....you guys in ND, SD, OH, MI, KY, Ontaris just don't count...nor does the fact that planting date doesn't matter anyway...date of emergence is all that drives yield, and not much is emerging with it being 28 tonight :-)  ).

Besides, there really isn't anything bearish in beans in the first place. Less acres, more demand due to lack of DDGS, etc etc. MW wheat could be very strong going forward once the deflation fear is removed. There won't be much deflation when you print money at this rate....

Anyway, a long-term rational market risk management plan is likely to outperform. Part of that plan that often works is to buy ITM calls on weakness and low volatiltiy in the spring-time. All those boxes are checked at this point.

btw....there is a risk of loss in farming and even more so in the investments required to manage that risk....ftr (for the record) 

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9 Replies
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Veteran Advisor

Good Post, timetippingpt

It's Now time to be Real Bullish. 

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Veteran Advisor

Re: Good Post, timetippingpt

It would be logical for markets

To go up....

.....and thats what bothers me.

 

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Veteran Advisor

Say 36000 pt

Dow by year end... Provided that covid is wound down during the summer and fall. 

And No covid flare ups now thru year-end.  

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Veteran Advisor

Re: "The rallies that are likely to unfold over the next 8 weeks."?

Quote: " the rallies that are likely to unfold over the next 8 weeks. "?  That's a big assumption, isn't it?

 Yeah, it's possible but if you look at the weather for later next week it's supposed to warm up quite dramatically and if the corn already planted has sprouted but safe under the soil surface you might be surprised how fast it can emerge and catch up.  I'm often surprised just how much root development can take place even if emergence is delayed.

  Besides, you're assuming that the external economic conditions will improve but if you look at the pandemic projections, you fellows in the Midwest and Mississippi South might be too busy burying your dead to worry about any "rallies".

  You need to worry about your demand destruction.  It doesn't matter how much corn you grow if you're not making enough of it into ethanol. When trump talks about 100, 000 dead, he quoting a model that actually says 135,000 and it's the most conservative model that has underestimated deaths by half once already.  The other models indicate that, in the words of the Surgeon General, "it's going to get real bad (next month)."

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Honored Advisor

Re: A Rare Marketing Post for the Marketing Page

It got down to 26º last night, it`s in the low 30s now.  I don`t know of many beans up, some corn up.  A little bean planting ahead of this forecast "cold drink of water" coming tonight and tomorrow, the Precision Planting guys warn about planting into that...but oh well.   Free replant seed, yee-haw!

This cold snap is going to take some of the early planting advantage away.  But yeah, buy a call and then feel confident in selling $3 (below C.O.P) with the possibility that`ll go to $2.25...but at least you`ll be 75¢ minus price of call ahead of your neighbors that are deer in headlights.  That and a cup of coffee, takeout of course.

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Veteran Advisor

Re: A Rare Marketing Post for the Marketing Page

Re: If's and but's were candy and nuts, We all would have a good christmas. !! Yes....we will see things go up, A call option would be the way To go rather than hold inventory... But.....which option....2021 2022 or 2023........alot of time premium in there !!!!
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Esteemed Advisor

Re: A Rare Marketing Post for the Marketing Page

Well, unlike Ricky Boy's comments, there really isn't anything bearish in some of the markets. Beans and MW for example have little bearish possible against current market assumptions.

So, we just like the Dec InTM options to start building a plan in beans, maybe wait and sell corn calls on a 24 cent rally.

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Honored Advisor

Re: A Rare Marketing Post for the Marketing Page

Time ----Market manipulation by usda or big bucks tech and funds....--How big does this factor in to marketing confidence?

Can we be relatively certain of anything in the latest election year manipulation,

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Advisor

Re: A Rare Marketing Post for the Marketing Page

Ricky Bobby was a breath of fresh air.  To bad your humor is left outside the door.  Not mention he has been mostly right.  A track record like Ricky bothers the powers to be more then the humor.

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