Floor Talk, February 14, 2020
At the close:
At the close, the March corn futures finished 1 3/4¢ lower at $3.77 3/4. May corn futures settled 2 3/4¢ lower at $3.82 1/4.
March soybean futures closed 2 1/4¢ lower at $8.93. May soybean futures ended 2 3/4¢ lower at $9.03 1/2.
March wheat futures closed 1 1/2¢ lower at $5.42 3/4.
March soymeal futures finished $0.80 per short ton lower at $291.10. March soy oil futures are $0.15 cents lower at 30.57¢ per pound.
In the outside markets, the NYMEX crude oil market is $0.64 per barrel higher, the U.S. dollar is lower, and the Dow Jones Industrials are 29 points lower.
At midsession, the March corn futures are 1 1/2¢ lower at $3.78. May corn futures are 2 1/2¢ lower at $3.82 1/4.
March soybean futures 3 1/4¢ lower at $8.93. May soybean futures are 3 1/2¢ lower at $9.02 1/2.
March wheat futures are 2 3/4¢ higher at $5.47.
March soymeal futures are $2.10 per short ton lower at $289.80. March soy oil futures are $0.07 cents lower at 30.65¢ per pound.
In the outside markets, the NYMEX crude oil market is $0.29 per barrel higher, the U.S. dollar is higher, and the Dow Jones Industrials are 37 points lower.
In early trading, the March corn futures are 1¢ higher at $3.80 1/2. May corn futures are 1/4¢ higher at $3.85.
March soybean futures ae 2 1/4¢ higher at $8.98. May soybean futures are 1¢ higher at $9.07.
March wheat futures are 3 1/4¢ higher at $5.47 1/4.
March soymeal futures are $1.00 per short ton lower at $290.90. March soy oil futures are $0.26 cents higher at 30.98¢ per pound.
In the outside markets, the NYMEX crude oil market is $0.75 per barrel higher, the U.S. dollar is higher, and the Dow Jones Industrials are 7 points lower.
Al Kluis, Kluis Advisors, says that the markets are leaning on bull spreads.
“Yesterday we saw good export sales for wheat and corn but soybeans were just average. South America has been picking up some business the past couple of weeks. Their harvest continues to pick up steam and they have a significant currency advantage over the U.S. Expect grain to remain in a very low volume lackluster trade,” Kluis stated in a daily note to customers.
Kluis added, "Grain prices will remain very quiet with low volume until we get close to the March 31 "Prospective Plantings" and quarterly "Grain Stocks" reports."
Re: Floor Talk, February 14, 2020
The longer we go sideways, the more vertical the rally when it comes. Yep, quiet and low volume....zzzzz.....
A great time to position for future events. Volatility is as low as it has ever been. Managing risk is the Blue Light Special at this point. :-)
You know, if we keep having solid export sales, every week, sooner or later someone is going to wonder about the soybean carryout after 2020.....
Re: Floor Talk, February 14, 2020
Something like sell an SX20 920 call, buy 3 1020 calls at a wash gets you long vol, come what may.
Lotsa time but probably do need to be aware that if it appears that SX will settle somewhere in between you need to be ready to bail while the loss is modest- no reason to take the max theoretical 1.00 loss-but that point is many months in the future. But it ought to make money just on vol expansion if there's a seasonal rally and will make a bunch if something goes seriously wrong.
I'd probably plan to take profits on one of the long calls if there's a spike in price and vol, then manage it as a 2 for 1.
That does require some margin and margin could expand under some scenarios.