April 25, 2012
Apologies for pounding away so hard on this but timing is obviously important in trading…and I am firmly convinced Corn is on the verge of collapsing under the weight of MASSIVE farmer selling…
I have written at length about the psychology of the markets, and have repeatedly noted that farmers, having been hooked on a VERY bullish, but VERY STALE, supply-demand story, are all STILL holding last year’s harvest in hopes of getting the high prices they DIDN’T take when they had them…And my contention they will all end up actually selling at prices far below today’s levels…
Here is a bit of “evidence” as to what I am talking about…
Here is another bit of news…Two announcements of substantial Corn sales in the past two days that are almost certainly Chinese purchases…This sort of news should be bullish for Corn, but both yesterday and today the Corn market opened higher (off the news) then closed lower…NOT what I would call bullish action.
4/24/12 **USDA has announced the sale of 480,000 tonnes of US corn to unknown destinations for 2011-12 delivery.
4/25/12 **USDA has announced the sale of 262,500 tonnes of US corn to China, including 90,000 tonnes for 2011-12 delivery and 172,500 for 2012-13 delivery. **USDA has announced the sale of 420,000 tonnes of US corn to unknown destinations for 2012-13 delivery.
Here is one put option I like here…IMMEDIATELY.
Get something on guys. Give me a call. This is a good one…
FARMERS- If you are one of those farmers sitting on old crop corn, I suggest you sell it now…And if your fear is the market will then rally, you can replace the inventory with a call option…