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ShelladyOptions
Senior Contributor

OptionEye.....June 16th

Good morning....and as the wicked witch of the west would have said...I'm meltingggg.

 

Corn taking it on the chin. After the July corn 722 level was breached, 714-712 became the next stop and I could see a little more downside before we start to make our move back higher.

 

A lot of pain over the last few days as large investors are blowing out of some of their bullish options positions. If you are a long term bull (and I am) you need moves like this to keep the market healthy so it ultimately can reclaim those recent highs. If too many people are on the bus it can't make its move. The decent progress report, better weather and dollar strength have combined to give the bears a perfect storm. At some point those commodities with a 'real' story will ultimately decouple from the dollar and begin to trade on their own. As for today, as was the overnights, a negative start is on tap. I think we have no more than another 10 cents to go to the downside in corn from Wednesday nights lows.

 

Until then. Good luck.

 

Scott

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4 Replies
hihowRya
Contributor

Re: OptionEye.....June 16th

Just to be the cotrarian. It took a perfect storm( literaly and figuratively) to get these high prices. As in high crude oil = high $ethanol,

Floods = less acres( still questionable), and the federal reserve trying to kill the dollar.

 

Last week someone was talking about running out of corn.

In 2004 I had a neighbor who kept his beans. Because he was raising hogs at the time.

If we ran out of beans he wanted his so he could make his own beanmeal.

Beans that fall were $5-$6.

 

Never under estimate the American farmer when it comes to finding more acres when

a profit can be made. At times we can be  our own worst enemies.

 

 Thanks Scott, for taking the time to post .

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ShelladyOptions
Senior Contributor

Re: OptionEye.....June 16th

And...as my father used to say 'the producers rarely disappoint'.

 

I still feel as though the market can't lurch from one view to the other that quickly. I also still think that corn supplies will be tight, unless, UNLESS we get a bumper crop.

 

A record wet and cold spring has not gotten us off to the races as I would have liked. But, those acres can be found. Informa today might help give us a hint.

 

At least we have something to talk about...try trading fixed income with zero percent interest rates..Ugh

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OK_Grains
Contributor

Re: OptionEye.....June 16th

Looks like Informa just adopted USDA like numbers. This should be friendly corn flat price given expectations for a less bullish number in the 91.5 vicinity....

 

INFORMA ACREAGE PROJECTIONS:

Corn – 90.613  million acres compared to June WASDE 90.7 and Informa last 91.9
Soybeans – 76.394 million acres compared to June WASDE 76.6 and Informa last 76.0
Cotton – 13.523 million acres compared to June WASDE 12.57 and Informa last 13.08
Spring Wheat – 13.287 million acres compared to March P.P. 13.6 amd Informa last 14.0

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marketeye
Veteran Advisor

Re: OptionEye.....June 16th

Thanks Scott for taking the time to post.

 

Mike

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