Focus on Commodities – Corn and Soybeans is based on the historical behavior of the instruments, as well as volume analysis as a predictive tool to see where the two markets will go. Today’s article is provided by our Grains Guy, Micah Palmer. Micah specializes in the commodities markets. Micah began working on farms while in high school. Then he discovered the trading world and applied his knowledge “from the farm” to trading the commodities market.
Focus on Commodities – Corn and Soybeans
Micah’s analysis of Corn and Soybeans is based on the historical behavior of the instruments, as well as using volume analysis as a predictive tool to see where the two markets will go.
I still have vivid memories of the 1988 drought and the lessons learned for the experience. The grains nearly always top right around this time of year even when supplies are being rationed as they are now. Take a look at the chart this week will make the 6th week of VD. Also, the USDA report on expected yields went out today and were not a huge shock to the market. While it is possible for the market to go higher I really expect this week to be the high with a slide down form here with a target of the weekly ATR. The weekly ATR is about 615 as I write this is about 2.00 per bushel. However, what I’ve been seeing I would also expect the price and ATR to converge about half of the due to time decay, note 1 dollar per bushel is still $5,000.
Similar to the corn, however, this chart looks like the high may well be in we had a MP on the weekly on the close today. Typically the high for Soybeans is a bit after the high for corn.
Much more exciting VD on these charts. These would be good markets for option trades…I would be looking for about a Dollar per bushel move on this as well, again $5000 per contract