Agricultural Markets Ahead of WASDE

July 10, 2018 3:16PM CDT

Agricultural markets are in somewhat unchartered territory ahead of Thursday’s USDA WASDE report following the implementation of tariffs this past Friday.  While it remains to be seen if there are further tariffs implemented, to this point, and obvious from Friday’s price action, it seems that the worst has been priced in.

While further trade tension is yet to be seen, there are a number of other aspects to the report the markets will have interest in, such as the spring wheat crop and if the conditions and progress remain bearish.

Up to this point, a good amount of releases have been positive for the agricultural crop and bearish for agricultural prices.  While it makes little sense to fight the market, one must also wonder, from a contrarian standpoint, if the weather, supply and demand developments will remain this way.

For traders looking to position for volatility ahead of Thursday’s report, some options spreads offer defined risk and undefined reward.  There are also a number of spreads between futures contracts monitored by our desk which may be considered as well.

To discuss how to position for your account in the agricultural markets ahead of this report, or ahead of reports in any market, please contact me at your convenience.

Soybeans Nov '18 Daily Chart

Soybeans Nov '18 Daily Chart

Corn Dec '18 Daily Chart

Corn Sep '18 Daily Chart

Wheat Dec '18 Daily Chart

Wheat Sep '18 Daily Chart

RJO Futures | 222 South Riverside Plaza, Suite 1200 | Chicago, Illinois 60606 | United States
800.441.1616 | 312.373.5478

The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results. Trading advice is based on information taken from trades and statistical services and other sources that RJO Futures believes to be reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgement at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades.

This material has been prepared by a sales or trading employee or agent of RJO Futures and is, or is in the nature of, a solicitation. This material is not a research report prepared by RJO Futures Research Department. By accepting this communication, you agree that you are an experienced user of the futures markets, capable of making independent trading decisions, and agree that you are not, and will not, rely solely on this communication in making trading decisions.

Distribution in some jurisdictions may be prohibited or restricted by law. Persons in possession of this communication indirectly should inform themselves about and observe any such prohibition or restrictions. To the extent that you have received this communication indirectly and solicitations are prohibited in your jurisdiction with registration, the market commentary in this communication should not be considered a solicitation.