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The author notes that interest in NG is currently low, both of Longs and Shorts.
He favours the upside though, due to increased demand and possible weather influences.
So Iam looking at the CoT for soybean and the producers are very long.
My thought process is the seasonals show july is the high and the non-commercial have to cover their short, therefore the price can move higher. Also looking at price action over the past 5 years soybean is at its lows. So sell puts? is my thought process correct?
THOUGHT please?
Bob
the seasonals show that around these weeks we may have the yearly high, so prices should rather go lower, and selling calls would be more appropriate, at least if you have a time horizon of more than 60 days.
much depends on weather now, so short time options i would rather see as a gamble right now.
also the dollar index may come into play.
I am looking at selling calls in wheat, corn and beans, when they appear to make highs.
Wheat moves up the strongest, but prices will come back when farmers will talk about their planting intentions for 2017/18. There will be calls to be sold at ridiculous prices.
Corn might be the first to move back downwards. Pollination will take place in July, and when weather forecasts show acceptable weather for this period of time price will come back down. I am looking at selling CZ calls.
Soybeans have their blooming period in August, and - depending on the weather forecasts - prices will move down earlier or later. Do not forget: Seasonals are a mix of many years.
Do not be too early: As long as weather is critical prices can move upwards dramatically. Have a look at the current chart for Minneapolis wheat, where just this is happening.
Yesterday's USDA report was slightly bearish corn and soft red wheat. But both commodities moved upwards, corn due to weather forecasts and in sympathy with soybeans, Chicago wheat in sympathy with Minneapolis wheat.
I expect the highs to be in some time in July, and intend to sell calls far above these markets. The problem will be to get the timing right.
I guess it was because of no liquidity. I there was decent open interest. My broker didn't give me a call as he was following my directions. My directions for him have been modified. While working I just want to exit positions at a profit that were made while I wasn't working.
My work doesn't always allow me time. I have a full service broker to for that reason. I have 5 months off a yr, then I have time. I can look at them everyday then, while I'm working sometimes I can only look once a week. That is why I am not placing any new orders. I still do much paper Tradeing but just pay attention to it once a week. Would be nice if one could only pay attention once a week an still make money, that is a nice dream.
