FOR MONDAY: (5/21) Grain cycles look lower into Tuesday and probably Wednesday, and they may not have far to go after strong rallies. Beans seem safest to sell but corn failed to issue a buy signal. Can wheat carry the rest of the complex higher or will the forecasts change over the weekend and overbought conditions lead to a pullback? Not going to sell wheat but can get away with beans shorts. Meats look higher this week, but Monday can be volatile, and it’s always hard to buy this early-week dips.
TRADING RECOMMENDATION: Wait for morning comments.
TODAY’S COMMENTS: (5/21) Corn follows wheat more lately and the technical breakout on wheat was strong enough that we’re not going to sell corn even if cycles are weak. The market overreacted to China speculation, which can change on a dime. We’re still looking for 390 and then taking out 405. The more bullish pattern suggests stalling at 404 and pulling back to 401 and then hitting 409 for an upside pattern completion that never came in. That might be a tempting hedge. Cycles and patterns are at odds.
OVERALL: We hedged 50% of July corn at 400.50 on April 30. Hedged another 25% of July corn at 403.
CYCLES OVERVIEW: Lower into May 22 and probably May 23.