Overnight, March Corn was down 5 cents at $4.05 ¼.  The included chart shows that March corn is well entrenched inside a broad trading range between $3.75 and $4.25.  Everything in between is just noise.  I am sure that the excuse for last night’s selloff is because of the strong dollar.  The directional movement indicators are bullish, but that really is meaningless lately as those indicators have been switching back and forth from bullish to bearish many times over the past two months.  The ADX line is still edging lower suggesting little trend strength.  What is important when we get bullish or bearish crosses in the directional movement indicators is to compare that to what the other technical indicators are saying.  If the lions share don’t agree then the trade should not be taken.  If the risk to the reward is too high, then the trade should not be done.  I look at things like the long term trend, short term trend, trend line breaks, chart patterns, Bollinger bands, MACD, moving averages, oscillators, divergence, volume among others along with directional movement indicators.  Generally speaking, trading with the trend is usually good advice, and trading corrections against the trend is generally bad advice.  I also take in account that the vast majority of the time, markets don’t trend very far, rather, they cycle back and forth.  That is why I usually like to write options against my positions to help increase the profitability of the trade.  Ratio spread trading is a good way to take advantage of normally cycling markets.  When a super trend unfolds, which is rare, then I try to move away from ratio spread trading to covered writes, vertical spreads or any type of strategy that is more directional in nature.  The goal is to take advantage of what the chart says with the smallest amount of risk.  No easy task.  It is an ongoing chess game.  The hard part is doing  this with all the “talking heads” giving emotional opinions all day long.  You have to ignore the chatter and follow what the non-verbal, no emotion chart says.   I am convinced that everyone that you hear and see on TV spouting comments and opinions all have their  own agendas.  Government officials don’t come on TV in my opinion just to blab, no, I think that they come on to say things to affect the way we think to fit their own agendas.  Market analysts do the same thing.  How many times do you see market analysts come on TV and recommend stocks to buy, and then they tell you that they and their firms don’t own any of the stock themselves.  I say, what??  I would like to know what their agenda is.  Are they recommending the stocks just to get viewers to open accounts so that their firms can make commissions?  Seriously, anytime you hear people coming on TV giving opinions on anything, you always have to be cynical and wonder what their agenda is.  Never take what anyone says for granted without checking it out yourself first before acting.

 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 64 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.

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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.

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Overnight, December Corn was down 2 ¾ cents at $4.01 ¾.  The included chart shows that corn is bouncing off the lows in the area where futures funds were bid buyers a month ago.  The rally, so far, has only put corn prices back in the middle of the latest trading range.  So, until proven otherwise, we have farmer selling near the highs of the range, and we have futures funds buyers near the lower end of the trading range.  That trading range is defined as from $3.75 to $4.25.  You would expect that we would hear major quality issues with the corn crop, but I haven’t heard any official word yet.  Surprising!  Given the way corn has traded lately, the rest of the market is surprised as well.

 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 67 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.

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March Corn is up 1 ¼ cents at $3.94 ¼ this morning as I write.  The included chart shows that yesterday, March Corn was able to bounce off the area near where the futures funds were strong buyers a month ago.  This support area below in the $3.70 to $3.80 area is critical to hold, otherwise, I would expect the funds to begin liquidating their entire long position which could send corn prices down towards the contract lows.  It is hard to imagine that happening considering that there is supposed to be a quality problem with the a lot of the late harvested crop.  I haven’t read about any real proof of that yet, but that is the talk.  The directional movement indicators are slightly bearish but the ADX line continues to fall showing a lack of trend strength.  I will wait to see if corn prices can challenge the upper end of the trading range once again, and to see if there will be strong farmer selling or not.

 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 70 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.

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March Corn is up 12 cents this morning at $3.95 ¼ following a neutral monthly crop report earlier today.  The included chart shows the nice rebound rally in corn so far today.  Corn, so far, has held near the areas where the futures funds were big buyers a month ago.  As this rally in corn proceeds from here, there is resistance at the back side of the uptrend line that was broken the other day in the $4.00 are which is also where the 200 day moving average is located.  If March Corn can close well above the $4.00 area, then I would expect another challenge back up towards the recent price highs near $4.25.  The longer term view that corn prices will eventually reach the $4.60 to $4.80 area is still in force.  The price lows that we have been seeing over the last month in the $3.70 to $3.80 area are even more important to hold going forward, now that prices held in that area once again.  The question now is whether the farmers have a lot more corn to sell on the rally.  If they don’t, then there isn’t anything in the way of any new rallies to higher highs.  Stay tuned.  This morning we have been filled on our order to cover the short March Corn ($3.20) puts at 3 cents.  That resulted in a gross profit of 3 ½ cents or $175.  Remember that we still have the $4.30/$4.90 ratio call spread that cost us 2 ½ cents, so we could look at this profit taken today as lowering our cost basis of the ratio call spread down to a credit of 1 cent or $50 gross.  Now, we can sit back and root for March Corn to rally over time and eventually reach the $4.90 area near expiration on February 19^th and not worry about the naked short $3.20 put option just in case corn prices don’t hold.

 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 71 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.

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Overnight, March Corn was up 3 ¼ cents at $3.88 ¼.  The included chart shows that March Corn is putting a severe test on the long futures funds where important support is in the $3.70 area.  So far the lows have held.  There is a monthly crop report tomorrow morning that shed some more light on the corn crop.  The rumor now is that any corn that hasn’t been harvested yet may just be left in the fields to be harvested in the Spring.  Who knows what type of quality that will be?  The directional movement indicators are bearish and the ADX line is moving sideways.

Currently we have a combination position on in Corn.  We own the March Corn 1*2 ratio call spread between $4.30 and $4.90 of which we paid 2 ½ cents to enter, or $125 gross cost.  We also are naked short the March Corn $3.20 put option of which we originally took in a credit of 6 ½ cents or a $325 gross credit.  My concern is that if the important lows in the $3.70 area come out and the futures funds liquidate their long positions, then prices could fall back towards the contract lows in the $3.20 area.  If we could buy back the short $3.20 call for 3 cents then we would realize a 3 ½ cent gain or $175 gross.  Then we would have that risk off the table and be left with the ratio call spread that cost us 2 ½ cents up front.  If March corn prices never made it back to $4.30, then the ratio call spread would expire worthless and the overall result would be +$175 – $125 = $50 gross gain.  So we would still be in the game if prices rallied up towards $4.90 and basically break even if prices stay down.  So, I recommend attempting to buy back the short March Corn $3.20 put option today at 3 cents.

 Followers of this letter should be short 1 March Corn ($3.20 strike) put option from 6 ½ cents, and 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.  There are 72 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.

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March Corn is down ¼ cent at $3.83 ½ this morning as I write.  The included chart shows that the battle between farmer selling and futures fund buying is currently being won by the farmers that are selling.  Prices have fallen back to the area where the futures funds have been accumulating long positions in corn.  The moment of truth has arrived.  Will the funds buy some more down here or will they throw in the towel?  Technically, the directional movement indicators are bearish and the ADX line is trending sideways.  The overall trend since September’s lows is still up, but that uptrend is under severe pressure.  Some of my other indicators are beginning to turn negative as well.  Corn needs to make a stand here or prices could fall further down towards September’s price lows.  I recommend holding on to our combination option trade for now to see if the funds want to play ball any longer.

 Followers of this letter should be short 1 March Corn ($3.20 strike) put option from 6 ½ cents, and 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.  There are 73 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.

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March Corn is down 2 ¼ cents at $3.86 ¼ this morning as I write.  The included chart shows that corn prices are stressing the bullish uptrend lines and moving averages that began after the September lows.  Right now, March Corn is trading right on top of the 90 day exponential moving average.  It was at the $3.72 and $3.79 areas where the futures funds were big buyers of corn a few weeks ago.  So it will be interesting to see whether corn will find support this week at these lower levels.  The surprisingly strong employment report on Friday gave the dollar a sharp rally, but today the dollar is stalling in its rally.  The directional movement indicators have turned bearish but the ADX line continues to slide.  I am getting conflicting views from my other indicators, so I recommend holding our current positions for now.

 Followers of this letter should be short 1 March Corn ($3.20 strike) put option from 6 ½ cents, and 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.  There are 74 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.

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Overnight, March Corn was up 3 ¼ cents at $4.09 ¾.  The included chart shows that March Corn continues to work in an overall uptrend that began in late September.  The near term picture shows the formation of a possible ascending triangle drawn for you in red.  As you can see, corn has room to work inside of this pattern for another week or so before it runs out of room.  I would expect to see a break out of this pattern within the next two weeks.  Normally, ascending triangle inside of overall uptrend’s, tend to break out over the flat side, bullish.  Currently, what we hear is that futures funds are the buyers on the price dips and farmers are the sellers of their corn on the rallies.  As long as the major support levels hold, in the $3.80 to $3.90 area, I would expect the funds to continue to buy the dips, and eventually the farmers will have sold all the corn that they have to sell, opening the window for prices to break out to the up side.  I would still keep a price target of $4.70 to $4.80 basis March corn in mind.  I recommend holding the current positions as is for now.  I may add to bullish positions if the chart sets up in the right way over the next week or so.  Stay tuned.

 Followers of this letter should be short 1 March Corn ($3.20 strike) put option from 6 ½ cents, and 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.  There are 78 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.

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March Corn is down 3 ½ cents at $4.11 per bushel this morning as I write.  The included chart shows that March corn continues to be in an overall uptrend well supported in the $3.80 to $3.90 area.  The drawn ascending triangle continues to be built out by the daily trading in corn.  This pattern could take another one to two weeks to build out before a solid break out occurs.  Ascending triangles usually break out through the flat side, and in this case to the bull side.  So we will hold our current positions and be patient for more opportunities in the next several days.

 Followers of this letter should be short 1 March Corn ($3.20 strike) put option from 6 ½ cents, and 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.  There are 79 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.

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