Grain Spreads: Springtime

Floods, cresting rivers, fields drowned out, and a water logged Western and Northern grain belt highlight the condition in much of the Midwest. Its the 1st day of spring, and while planting conditions seem a long way off, there's not going to be much worry about that on March 20th. If conditions don't improve in the weeks ahead, then the market will start to get some weather premium built in in my view. For now we have planting intentions at month and quarter end on 3/29/19 that will take precedence in the near term as well as the drama and saga of the never ending trade spat with China and others. As always we will focus on studying the charts for future direction with weather and demand our chief fundamental drivers. Game plan into next week is to position into three spreads or trades one can consider to take advantage of short covering ahead of the stocks in all positions report and planting intentions on the 29th.

Dec 19/Dec 20 Corn Calendar Spread. Suggested Entry-16 to 18 cents Dec 19 under.Stop loss at 22.4. Objective 3 cents Dec 19 over.

Next is Nov 19/Nov 20 beans Calendar Spread. Suggested entry, 36 to 37 cents Nov 19 under. Stop loss at 41 cents Nov 19 under. Objective 21 cents Nov 19 under.

Last but not least is Minneapolis Wheat outright May 19 futures. We are at major resistance at 571/572. A close over takes us potentially to 585 and 6.02. Aggressively buy futures at 570-72. A close under 561, and you are out. May 6.00 calls settled at 6.6 today, 30 cents out of the money. Once could buy futures and sell the call. Major risk there. Spring wheat planting delays and we can trade up to the 6.00 handle easily in my view.

Call me with questions. 888 391 7894 or email me at slusk@walshtrading .com In my view bid these levels into next weeks report with tight stops in place. I'm not looking for rallies but short covering to emerge from these massive short positions in the market. Please join me for tomorrows grain and livestock webinar at 3 pm Central. Signup is free and a recording link will be sent to your email.

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