Texas Hedge

[crusher]

Looks like its time to buy Kansas wheat according to the daily and weekly charts. Who's with me?

[ado089]

I'm on mobile so don't have great charts. What technicals are you using? Stk is ugly and we're below the moving average on a down trend. Daily chart is a little better.

[ado089]

Sorry, daily looks way better.

[farming101]

Not yet. My motto-the market is merciless.
Open interest rising on this major downtrend says to me it isn't done yet.
Looks like the 52 week low could fall, then who knows?
Sorry to be the contrarian.

[crusher]

September daily about as low as its been. Triple bottom if you ignore the $4.95 made in May.

On the weekly its touching the bottom of the up trend line.

[farming101]

Crusher, do you look at the weekly nearest or the weekly contract?
Weeky nearest does show a nice support line but it charts the activity of three different contracts during that upturn.
The weekly contract chart is not quite as clear.

[biglentil]

Go long commodities paper is in trouble, cracks going large.

[crusher]

Weekly nearby. I try not to over think. One can justify any opinion through a myriad of signals. I might be right, might be wrong, but sometimes you have to make a move. Did I sell any canola over $525 - nope. Froze up even though I've got a 35-40 bushel crop coming. Did I sell some Kansas wheat a couple weeks ago over $6 - yes. Feed wheat last week for $6.75 - yes. Sometimes you get lucky. I think I'm right more than 50% of the time but make a move closer to 25% of the time. Still have some old crop hard red and canola left. About 20% sold new crop canola and peas. Nothing on wheat.

[farming101]

If your short Kansas from 6 plus that changes the view.

[TOM4CWB]

Crusher, Unless you believe the US will go back to floods... $500 Canola hedged will be better than $460 Nov 2016 trading already? Nov 2016 headed for 420?

Still way better than last winter @ $420!

[TOM4CWB]

I see the long term bull soy isn't broken yet... but is bouncing off the bottom of the range... 200day average as well! Corn dropped to $4.08 from $4.50... good weather could break this hard down... feed wheat easily under $5.

[crusher]

If overall crops in Canada and U.S. are like mine, top yield was determined a couple of weeks ago and all we can do is hope that we can maintain what we have. Just because the weather has changed for the better in most areas, doesn't mean the supply will start to increase.

Fundamentals are ruled by supply and demand. I think if I was a buyer of wheat, I'd see that chart and go this is about as low as it goes and I'm going to get some coverage. Maybe even the short funds might take some profits. Always lots of opinions, that's why there is a market.

[Oliver88]

Crusher, Tom or anyone - for a call option would you use Chicago, KC or Minne?

My broker suggests Chicago but would like to hear your comments.

[crusher]

Oliver88,

First question is: are you downright speculating? Or are covering some previous sales of a particular wheat kind. For example if you sold some hard red a while back and want to participate in some possible upside, then go with Minni. CPS - go with Kansas. If you want to just pick a wheat then Chicago is a decent choice because it has the greatest volume/liquidity. I haven't checked but the premiums may be less too. Most of the time the wheat prices are highly correlated.

[TOM4CWB]

Crusher, Right on with Wheat options.

Soybeans yields are made in August... some volatility possible... but normal rain and heat will net a big crop. Looks like the MidWest is short on heat units this year... but a few hot weeks will push this fast! Fabas are back blooming... they will sure be late!