FOR FRIDAY: (5/4) China optimism did us in and we should have just stood aside. White House Economist Mark Calabria commented after the first day of trade discussions in China that he was “optimistic” and that US has “discreetly” given China a list of asks and that the day ended “pretty positive.” However, what algos clearly ignored is that Calabria concluded on a slightly more somber tone, saying that “the tough part in the talks is ensuring China keeps its promises.” And that was enough to ignite the momentum into the green for the day. We think China optimism will bleed over into the morning but a reality check may hit later in the day and knock the market down. Hard to play these news-sensitive days.

JULY CORN (electronic ok)
TRADING RECOMMENDATION: Wait for morning comments.
TODAY’S COMMENTS: (5/4) Staying open for 410-11 for more hedges. Wheat is pulling corn up. We’re not going to try to top pick with a solid close above 401. But next place to sell for hedgers is the 410-11, which should easily hit. Not sure when reality will set in that the crop will go in ok. Eventually the daily chart pattern now would be more complete later in the season to 411 and 418. Not seeing crop problems unless its too much rain this year and may not be a problem until June.
OVERALL: We hedged 50% of July corn needs. Will wait for 411 and 418 to do more.
CYCLES OVERVIEW: Topping Monday; next key swing low into May 7.

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