Schnook 

The squeeze is on. All those specs who shorted corn below 330 are definitely sweating now.

It missed my 325...

I took profits on half my position in September corn at 349 1/2 and 352 3/4 today. Still carrying a small core long, though, as I think there's potential for additional gains in the weeks ahead. As I mentioned when I first posted my rationale, this is a longer time horizon swing position that I'm perfectly comfortable holding for a while. I also reserve the right to add again, trading around this core position if I see an entry that I like.

I added back a few contracts this morning at 342.25 and 342.50 (market now 341.25 bid as I type) but will keep a fairly tight leash on these adds.

Specs have covered some of their shorts but I believe they still have quite a bit more to do. I am also hoping that this morning's early bounce off the 40 area may portend additional near term gains. We shall see soon enough

I'm not going to make it a habit to post all my trades here (that's what journals are for) but since I posted those entries this morning I feel somewhat obliged to mention that I sold part of my add at 43.25, 44.75, and 45.25 - targets met on a shorter time frame buy signal I acted on this morning (note the little green arrow on my chart).

Schnook 

I'm not going to make it a habit to post all my trades here (that's what journals are for) but since I posted those entries this morning I feel somewhat obliged to mention that I sold part of my add at 43.25, 44.75, and 45.25 - targets met on a shorter time frame buy signal I acted on this morning (note the little green arrow on my chart).

By all means keep posting. My strategy got me in Tuesday at 340.50. I'm looking to take profit at 348.75 or whenever big orders start leaning short.




Snap shot of big orders for the last 2 days.
2020-07-08_1841

My strategy took profit at 350.... Although looking at the institutional orders, I do not see any evidence of an attempt to short yet.


Snapshot of Large orders added overnight (Yellow Box).

2020-07-09_0704

Was that it? Was that the short squeeze I was hoping for? Lame.

Large speculators went from a 235,000 lot net short in early June to a mere 100,000 lots last week. That still leaves some room for covering bids but not exactly squeeze material anymore.

I'm still dragging around a very small long position as I think current prices reflect expectations of near record harvests, and any adverse weather event or disappointment in yields could push prices back into the mid 3's, but I no longer have much conviction here. The setup looked great two months ago but it seems to have fizzled out quickly.

If any of you folks have interesting thoughts or ideas here I'd love to hear them.

Schnook 

Was that it? Was that the short squeeze I was hoping for? Lame. Large speculators went from a 235,000 lot net short in early June to a mere 100,000 lots last week. That still leaves some room for covering bids but not exactly squeeze material anymore. I'm still dragging around a very small long position as I think current prices reflect expectations of near record harvests, and any adverse weather event or disappointment in yields could push prices back into the mid 3's, but I no longer have much conviction here. The setup looked great two months ago but it seems to have fizzled out quickly. If any of you folks have interesting thoughts or ideas here I'd love to hear them.

For corn, the time of high risk during the pollination period is over for a while. This is the time when I like going short corn, and I sold some 3.50 October call options.

The next significant potential risk will be early freezing, but until then, in my opinion prices will move south or sidewards.

Best regards, Myrrdin

myrrdin 

For corn, the time of high risk during the pollination period is over for a while. This is the time when I like going short corn, and I sold some 3.50 October call options. The next significant potential risk will be early freezing, but until then, in my opinion prices will move south or sidewards. Best regards, Myrrdin

Thanks myrrdin, I always appreciate hearing your perspective.

USDA was forecasting a record corn crop of over 15.2 bn bushels as September corn tested the low 300s. This week's storm has now been estimated to have damaged or destroyed anywhere from 200-400 million bushels across Nebraska, Iowa, Illinois and Indiana. Not huge, in the grand scheme of things, but enough to send prices back up into the 325 area.

Again, my general thought had been that markets were fully pricing in record crops and leaving very little margin for error, creating a bit of a risk asymmetry going into the fall harvest.

Large speculators, who had covered the bulk of their shorts in June, reloaded some shorts again last week, leaving a total net short position of nearly 150,000 contracts, the equivalent of 750 million bushels.

I used yesterday's rally to lighten up my position at levels close to where I originally bought them but am tempted to add back in the mid teens if we get there (330 area on the dec contract). At this point I believe that the lows are probably in for this cycle.