Play Turner’s Take Podcast Episode 230

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New Podcast

We have a new podcast out and I go over why we think the macro markets are now rebounding and the bottoms are in. We also talk about why we like Dec LC, Dec CL, the ES, but we are sellers of Dec corn.  Their are two big reports on the horizon.  The monthly Employment Report will be out on Friday, May 8th and the May WASDE is on Tuesday the 12th.  Make sure you take a listen to this week’s Turner’s Take Podcast!

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Macro Markets

Many states across the US are reopening their economies as are nations around the world.  The macro markets have stabilized and will be on the long road to full recovery. I like buying the dips in the Emini S&P.  There is also a micro contract available that is 1/10 of the size.  A close above the 200 day moving average (green line) will be a very bullish catalyst.  Always keep in mind the stock market is not a reflection of the economy. Top executives at these companies are paid to be profitable in good times and bad.  Corporations will cut back on capital expenditures, staffing, streamline processes, and do whatever it takes to adapt to the economic environment.  Stocks are prices on growth expectations, cash flow, and earnings.  The market can grind higher even when the economy is not doing well.

CNN | Where All 50 States Stand On Reopening

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Emini S&P 500

Grain & Oilseeds

I liked buying July corn on FND and it is up about 5 cents since then, but the rally has not been as big as I hoped.  Even with the big rally in crude oil corn can barely touch $3.20 in July.  It is time to step aside, take a small profit, and focus on what is really important…and that is shorting new crop corn.

Below are my tables for corn and soybeans.  There is nothing, and I mean nothing, bullish about that corn supply and demand table.  Just so we are all clear, my business does a lot better when we are bullish corn.  I don’t enjoy being a mega bear for the corn market.  The fact is old crop ending stocks will be 2.5 billion bushels or higher due to the loss of corn demand for ethanol production in the 2019-20 marketing year.  New crop corn ending stocks will likely be over 3.5 billion due to 95mm + acres, a trend line yield, and not enough demand from ethanol and exports.  As things stand new crop corn is expected to trade sub $3 this fall.

I want to be short Dec 2020 corn heading into the May 12th WASDE.  I like selling Dec 2020 outright. I like the Dec 20 vs Dec 21 futures bear spread. I like buying puts and selling call.  I’ll be putting out some specific trade ideas in my client email this week. Clients of mine who don’t get these emails please call me at 312-706-7610 or email me and I’ll make sure you are on the distribution list.

As for the soybean table, it is not that bad.