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Much thanks for the quick replies!
I will definitely check out both of your report and newsletter recommendations.
I can see the September/October drop then rise on the historical charts for corn. Ron and Myrrdin, how exactly would you play that? From my knowledge of options, I'm thinking you could sell calls in early September then buy back and sell puts in October; or you could sell puts in September while the market is still going down in the hopes of collecting higher premium and then wait (hope) for the October turn around and subsequent premium collaspe; or maybe some type of calendar spread to play both sides of the move?
Am I on the right thought process here?
Can you help answer these questions from other members on NexusFi?
Thanks, Ron. BTW: What would really be cool is access to a history book or almanac of sorts that could detail each year's crop and price movement, with the corresponding news items, weather reports, and other commentary that may have caused a course change in the regular seasonal patterns. I think that by studying previous years' chart patterns AND corresponding fundamental news items, you could really get a feel for what happens and why.
Any ideas on where to find history like this?
While seasonals are an important element of my trading, there are additional elements: Supply & Demand, weather, COT data etc. I base my trades on all information I can get.
An example: The seasonal charts clearly show rising prices for soybeans from December onwards. In 2014, there was a huge supply in the US. Brazil and Argentine will show a huge supply soon. But prices went up strongly in November and December due to transportation problems. It was obvious that these problems could be solved earlier or later. Thus, I sold calls above the market, and I sold some additional calls recently when there was a chance.
Currently I am positioned (as far as grains & beans are concerned) with short calls in soyeans and corn, and short puts in corn, wheat and cotton. Not all of these trades are according to the seasonal charts.
Thus, I suggest to discuss your question later in the year.
The nice thing about selling options is that you only have to do it once per set of options. And afterwards follow up if there is a significant change in the fundamentals.
And the nice thing about a forum like this one is that we can share this information.
A little more digging into some of the suggestions here has led me to the CRB and MRCI websites, where they have "commodity yearbooks" and other such stuff, including trade recommendations based in seasonals. MRCI also has an option implied volatility chart service that looks pretty good too. I might give one of these guys a try to help hold my hand while I am learning to walk :-)
