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Grain Spreads: Corn Outlook


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Remember when corn was 4.68? It was the high the last day of June made just after the quarterly stocks report prior to the acres release. The USDA came out and said we actually planted more acres than last year and as a result 4.68 was your seasonal top. that level represented a 20 percent move higher for the calendar year. funds love these percentages in my opinion and will often target initiating positions or unwinding them at these round number percentage levels. Currently Dec Corn sits at 3.58. We just crashed through another level of key support at the 367/68 level. (See arrow on chart) Leaving 3.55 the next trend line target. Our weekly low this week so far is 356.4.

Back to percentages for a moment. We closed out 2018 at 3.90. Twenty percent higher for year was 4.68 which was hit twice in June. Ten percent lower for the year is 3.51. Twenty-five percent lower from this years top comes in at 3.51. this may not be a bad are to start to establish if we get there to establish longs in the market, short cover, or buy cheap calls. We have some time prior to harvest as a late planted crop results in a late planted harvest. Should this level not hold the trend line coming up the page from the 2016 low to the 2019 low comes in at 3.46/47. fifteen percent lower for the year pushes the corn market to 331 while 30 percent from the high pushes it to 3.28. Watch the 351 area into the report and look to buy with a tight stop under 3.46 into the report. While the market is oversold, who knows what surprises the USDA might hold this time as far as production and yield are concerned. In the interim demand is subdued and the weather is supportive for production in my view.

Please join me tomorrow for a free grain and livestock webinar at 2pm Central. We discuss supply, demand, weather, and the charts along with speculative and trading ideas. Signup is free and a recording link will be sent to your email. Sign Up Now

Sean Lusk

Director Commercial Hedging Division

Walsh Trading

312 957 8103

888 391 7894 toll free

312 256 0109 fax

slusk@walshtrading.com

www.walshtrading.com

Walsh Trading

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Chicago, Il 60604

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About the author


Sean Lusk is a registered commodity broker and Director of the Commercial Hedging Division of Walsh Trading in Chicago. Sean began in the business as a runner on the trading floor during summer breaks from college in 1993. Upon his graduation from Southern Illinois University at Carbondale in 1996, Sean began his career on the trading floor of the Chicago Mercantile Exchange (CME). Overseeing billions of dollars of transactions working as a clerk in the Eurodollar pit, Sean took the next step and became a floor broker and member of the CME in 2003. He handled customer orders for banks and investment houses from all over the world from inside the Libor pit at the CME.

Now, at Walsh Trading, Sean utilizes his experience in the marketplace and his professional client service skills to aid and assist customers in their trading endeavors.  

He writes daily and weekly commentaries focusing on both the Precious Metals and Agricultural Markets along with related market activity.

Sean has been quoted in various media outlets discussing futures markets. 

These include:

 

  • Futures Magazine
  • Reuters
  • Forbes
  • Kitco
  • Nikkei Press
  • CCTV.com

 

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