Overnight, March Corn was down 3 ½ cents at $4.05.  The included chart shows that corn has had a nice sharp rebound off of the recent one month price lows.  Corn prices are within about 20 cents of the recent rally highs at about $4.25.  There is  double top looming over this market in the $4.25 area, so It is important that price continue to push back towards the recent contract highs.  The directional movement indicators are just barely bullish and the ADX line is edging lower.  None of this supports the idea that a major move in corn is underway yet.  I would recommend holding our current positions.

  Followers of this letter should be long one March Corn ($4.30 strike) call option from 17 ¼ cents and short 2 March Corn ($4.90 strike) call options at 7 3/8 cents each.  (As a result of the profit made on the short $3.20 puts, our cost basis of this ratio spread is now a 1 cent credit!) There are 66 days left until March options expire.

 With all the price tests above $4.00 recently,  I would hope that the producers have already liquidated most if not all of their corn that needs to be sold.

 David Hall

 The information and opinions contained herein comes from sources believed to be reliable, but are not guaranteed as to accuracy or completeness. The risk of loss in trading futures and/or options can be substantial. Each investor must consider whether this is a suitable investment. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results.

 This newsletter is not intended for dissemination to the public without prior approval from David Hall.