Corn Hits New Multiyear Low

Back in January this year, Corn futures had reached as low as 408 (see Weekly Corn futures chart below).   Today, September Corn futures hit as low as 397.50, making it a new low (the last time prices dipped below 400 was in 2010).

We are going to be watching for a 123 bottom formation before going long the Corn market.  Stay tuned!

Weekly Corn

Exercising Our March Corn Option

We had purchased a March Corn Call option at a 445 Strike Price (see our post: We are Long Corn After Breakout Above 439 As Of 12/12/13) which expires today, 2/21/14.  Prices as of today are 453.5 (at the time of this post).  Since our March Corn Call option is worth a little less than we paid (we paid $437.50 back on 12/12/13, and as of now it’s worth ~$425.00 if we sold it, since there is no more time value left on this option) we are instead going to exercise our March Corn Call option and place our Stop-Loss at 437.25 (just below the support level on the Daily Corn chart below).

If prices move up from the current level of ~453, we will gradually move up our Stop-Loss to lock in more profits.  If prices move down below 437.50, we will have only lost our original investment in this option of $437.50 plus $400 (445 Strike Price minus 437.25 = 7.75 cents X $50/cent) if we get stopped out.  That’s a total risk of $837.50 in a market already trending up with huge upside potential.

Daily Corn - 2-21-2014 Support Level