RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

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

Michael O'Donnell

Mike started his career in the markets on the floor of the Chicago Board of Trade as a trade checker for a local market maker in the Dow Futures pit. This led to interning with an independent introducing broker and going on to work with a number of market participants including: speculating clients, hedge clients, introducing brokers, futures commission merchants, commodity trading advisors, proprietary traders, trading educators, system creators, and a number of international financial market participants.