A request…

This is carefully worded and kept as concise as possible…And it is certainly my biased opinion, but I regard this as one of my better pieces of research…and am therefore hoping that you will give this more than a “skim.” I think there are no wasted, irrelevant thoughts here, and ask, if you can, that you wade through it line by line…and chart by chart…as, in my mind…I believe it will absolutely be worth it to you…Also, if you do think what I have offered here makes sense, do feel free to pass it along to anyone who might also have an interest. This newsletter is my primary sales tool and I am obviously always in getting new people on board with me.

Thanks,

Old Hack Bill

May 17, 2024 (BTW…Almost 2 years to the day since I called THE major top in Corn, Soybeans & Wheat)

Some Trades are FAR better than others…I can only regard this as one of the best, highest probability set ups, I have seen in years…And do understand that is not stated as some sort of sales hype…And while my extreme confidence does NOT mean I will be right…this is one of those situations where my own perspective is to “step up,” in the vein of, “If you’re going to make the trade, MAKE IT COUNT.”

I would add that while my opinions remain the same in the handful of other markets I have recently recommended (Long Bonds & Cotton vs Short Cattle, Cocoa, Soybeans), this trade is now my PRIMARY FOCUS until it either proves me wrong…or makes me, and hopefully you---IF you participate---the kind of substantial profits that you’ll see calculated on my usual specific option recommendations. It should go without saying, but I always do remind you that if I am wrong, you can lose every dollar you invest in this.

I continue to roaringly believe that sometime in the next 3-4 months that classic headline, “Rain Makes Grain,” will be all over the ag market news and that this THEN bearish sentiment (not the case at all now) will have been generated by SUBSTANTIALLY lower Corn prices…

Per the 50 odd years of history that follow below, I believe the odds OVERWHELMINGLY suggest that the now two year old Bear Market in Corn will culminate in a final 20-30% drop from here, taking Corn down into the $3.25-$3.50 area. I KNOW THIS SEEMS UNFATHOMABLE TO 99% OF THE AG COMMUNITY AS I HAVE OBSERVED THAT 99% OF ANALYSTS AND FARMERS ARE NOW ALMOST UNCONDITIONALLY CERTAIN THAT CORN HAS BOTTOMED…In fact, I would go so far to say that this “It-has-bottomed” PERCEPTION is currently the single most unanimous opinion in all of the various futures markets today…And if you think “unanimous” is a good thing in the markets, I will offer that you are mistaken.

FACT…

As I keep pointing out, farmers are STILL holding MASSIVE stocks from last year’s harvest…STILL hoping for rallies…BUT…as we go forward from here, they will be more and more in need of cash SALES to fund the current crop they are planting and working…And beyond that, they also STILL will need to clear their bins (SELL) to make room for the next harvest…This is not speculation. Those are facts. And plain and simple, all of those Billions of Bushels of Corn that HAVE to be moved represent selling, selling and more selling in the months to come…AND…Aside from that, never forget the other factor that absolutely comes into play…AS PRICES FALL, AND FARMERS BASICALLY WATCH DOLLARS DISAPPEAR IN THE BINS, FEAR DOES INSPIRE MORE SELLING.

Every year is different, but on the 36 charts following, going back a half century, there is one fairly strong constant here on all of them…which is that excepting a drought, Corn typically IS in a sinking mode between Spring and the end of Summer…sometimes erratically, sometimes just unremittingly lower…and it IS because of the two factors mentioned above…farmers needing the cash and having to clear the bins for new crop…and yes, fear.

Trading IS educated guessing…that aside from the usual nod to what you think may (or may not) be of fundamental or news driven relevance…to a large extent certainly has to be based in histories of how markets can or DO typically behave…So, as you hopefully give the charts here more than a quick glance, I suggest that what you don’t do here is overthink it…You just put the current Corn situation together with what you see here 36 times, and the FACT that farmers ARE still holding massive stocks…and I’m sorry, but I’ll repeat this: Every analyst I’ve seen is totally convinced that “the bottom has been made in Corn,” and if that statement is correct, it also means that just about EVERY producer and end user out there (in other words, everybody in the Corn business) is also thinking and acting with the same opinion in mind…And if you think that this IS what it feels like at a commodity bottom, where everybody is going, “Oh yeah! That’s it. You can just buy it now,” my only answer is…THAT AIN’T THE WAY THIS STUFF WORKS. Period! THIS IS WHERE YOU GET SHORT…NOT LONG.

 50+ Years of How Corn Declines

 DO note:

WHEN They Started.

How QUICKLY they did it.

MONTH They Ended.

How Big The PERCENTAGE DROP.

And yeah…How almost straight down they generally do it…One more time---As farmer selling just keeps coming, and coming and coming…all the way into the next harvest.

And yes, the very definite evidence is that the decline can be starting any time NOW…and will often be ending in July, August & September…over and over and over…

Those are the undeniably indicative histories…This is the way I view this trade…

 All things considered, even though this could absolutely NOT happen as  I think it will…which could mean losing every dollar you invest…I think this is about as high probability as it ever gets…STRONG historical charts and GOING WITH AN ESTABLISHED TREND…And my own personal objective is to be there “in force”, TO GET THE POSITION INITIATED HERE…And then not forget to take the money when and if it gets down into the big percentage profits outlined below (which I was guilty of with some of you in this same trade several years ago.)

All bear markets DO have periodic rallies…same as we have seen in the recent month, but those rallies are normal…and only serve to reinforce the still ever wrong opinion that “We’ve bottomed!”…And what you are SUPPOSED to do with those rallies is look for some indication that they’ve failed…and SHORT THE BEAR MARKET…That’s just Trading 101…And the truth is, last Friday we had a purportedly bullish USDA report, which hopped everybody up even more…and rallied Corn to a new recent high…which has FAILED miserably throughout this entire week…and DID, I firmly believe, represent the END OF THIS BEAR MARKET RALLY.

Weather (Hot & Dry usually) can enter the equation, but inevitably, unless you’re in a full  blown drought, those rallies tend to be quickly over…and actually represent additional selling opportunities…

When it starts…and I believe the last few days since the “bullish” USDA report ARE the beginning of the move…IT DOESN’T MESS AROUND…time after time, it is RELENTLESS. And why? Because buyers have their hands in their pockets…They’ve already been convinced by all the unanimous bullish opinion and have ALREADY bought it…while meanwhile, the farmer? THEY ARE SELLING…AND SELLING…AND SELLING…because sooner or later they basically HAVE TO!

And one further note as to what motivates them? Like I said…We had that “bullish” report last Friday? That rallied the market about 20 cents? But then made its high Monday spent the rest of the week dropping 25 cents for a dead low close today? Let me tell you…Nothing is absolute in this business, but a BEARISH response to bullish news is NOT usually a bullish sign…And all those farmers out there who were certainly expecting MORE than one up day…? I do know something about human behavior when it comes to unexpected “negative price action” in the markets…and I can assure you that this week’s DOWN action has NOT created any new bullish sentiment, but instead has ALREADY “inspired” some farmers to start calling their elevators with SELL orders…And believe me, every nickel lower from here is going to “inspire” more of the same.

MY IMMEDIATE TRADE RECOMMENDATIONS…FOR SUNDAY NIGHT OR MONDAY MORNING

There are any of ways to go about this…from conservative to aggressive…with more time or less time…with at-the-money or out-of-the-money puts…and yes, I am even recommending futures here (as “smallish” additions to owning puts). So, here are some possibilities…And no question…I’ll say it here. If you have any intention of doing this, let’s get it done. I do NOT exaggerate…It’s all up there on those charts…It IS that time of the year for this trade to happen…and when it starts down, and we definitely may have seen it begin this week, it DOES just GO.

This is the straight up most sensible option to use…or start with as a base position…

This could combined with the 450 Sept put…

This is a little more aggressive…

And this is even more aggressive…and much bigger leverage…but with only 5 weeks to expiration…But COULD happen (go back and look at how some of those charts DID just collapse). Also to say that at expiration, it IS absolutely possible that this option would already be well below the 435 level and then be trading like a future…in which case it could be held, if so desired, all the way into the July contract expiration.

I cannot express every aspect that’s in my head regarding this trade…and the potential I see in it…but here’s an afterthought as I finish this: If this is going to work, irrespective of how many times I remind you that it might not, I DO THINK IT WILL WORK BIG…which does support the idea of owning SOME out-of-the-money puts…even crazy ones…To quote/paraphrase one of the world’s greatest traders: There is nothing in the world that is routinely more surprising, nor bigger dollars, than that last 30% of a move…AFTER you think it just must be over…So I will say it again: CORN STILL HAS A LONG WAY TO GO.

If you did read all this…Thanks…But now it’s totally in your court. As always, I might be dead wrong but I’ve given you everything…all my guts…I have here. Hope you’ll get a piece of it and maybe make a boatload of money.

I think this is a great piece of research…and I have to say this…I know the internet is cheaper than I am but if my work influences you to make this trade, I can only hope you will do me the courtesy of taking your short positions with me.

And maybe it’s not a good sales technique (yes I DO have to sell you my opinion and ideas) but I’d say if this short trade doesn’t do it for you, nothing ever will....And…For some of you guys who have been READING my stuff for years…If this does make sense to you…and if you ever DO “indulge” in this sort of risk, at least give a thought to calling me up and GETTING SOME OF IT…and not just shoot me “I really like your stuff” emails…Come on. Throw me a bone.

Thanks…Cain’t do no more. It’s all yours from here.

 Bill

770-425-7241

866-578-1001

All option prices in this newsletter include all fees and commissions. All charts, unless otherwise noted, are by Aspen Graphics and CRB.

The author of this piece currently trades for his own account and has a financial interest in the following derivative products mentioned within: CORN. CORN. CORN