A Choppy Trade in Grains Offers Opportunities

Grain markets have been choppy over the last 24 hours, presenting some great opportunities for shorter term traders

Corn

Wednesday’s Recap

May Corn futures settled at 512’2 Wednesday, down by 3’4, in mostly lower trade. Across all maturities, volume was 516,971, with the May contract seeing 185,421 traded. Total open interest ended at a contract high of 2,073,538, higher by 1,924, or 0.0929%. May open interest rose 35,114 (4.66%), to 787,880.

Technicals
Corn futures attempted to keep the rally going yesterday but failed to attract new buyers near Tuesday’s high which led to a slight reversal back near our pivot pocket from 499-502 1/4. Into March options expiration tomorrow, $5.00 looks like a potential magnet for the market. Below that and the 20-day moving average is in play which comes in near 491 1/4. As mentioned in yesterday’s commentary, the trend is still intact, but these are likely price levels where producers (who are perpetually long) may consider playing a little more defense. Options can be a great way to protect the downside while keeping the upside open.

Technical Levels of Importance
Resistance: 508 1/4**
Pivot: 499-502 1/4
Support: 488-491 1/4***, 479 3/4-482 1/4**Popular Options
Option volumes were highest for the March 500 call (4,535) and the March 500 put (6,917). Calls with the most open interest are the July 500 strike (41,720), and for the puts are the March 440 strike (19,734).

Volatility Update
As measured by CVL, implied volatility closed the day down, dropping by 0.49 to end the session at 20.71. Gaining 0.22% to a one month high, historical volatility (as measured by the 30-day) closed the session at 21.73%. The CVL Skew closed the session sharply down, off by 0.83 to settle at 0.94, a one month low.

Below is a look at historical price averages for May corn futures on a 5, 10, 15, 20, and 30 year time frames (Past performance is not necessarily indicative of future results).Futures trading involves substantial risk of loss and may not be suitable for all investors. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are 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 judgment 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. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.Blue Line Futures is a member of NFA and is subject to NFA’s regulatory oversight and examinations. However, you should be aware that the NFA does not have regulatory oversight authority over underlying or spot virtual currency products or transactions or virtual currency exchanges, custodians or markets. Therefore, carefully consider whether such trading is suitable for you considering your financial condition.With Cyber-attacks on the rise, attacking firms in the healthcare, financial, energy and other state and global sectors, Blue Line Futures wants you to be safe! Blue Line Futures will never contact you via a third party application. Blue Line Futures employees use only firm authorized email addresses and phone numbers. If you are contacted by any person and want to confirm identity please reach out to us at info@bluelinefutures.com or call us at 312- 278-0500Performance DisclaimerHypothetical performance results have many inherent limitations, some of which are described below. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. In fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program.One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk in actual trading. For example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all of which can adversely affect actual trading results.