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Highlights, Olga's Options, Markets & Rain Days Update 5/28/22


The corn basis at the Gulf was steady Friday, but soybean basis was 6 cents weaker for May, 2 cents weaker for June, and unchanged to 1 cent weaker for July.

Old crop canola was up $8 to $9 a mt, but $4 to $5 lower for new crop. Canola is an oil seed.

July beans traded to $17.44¼ yesterday, 3¼ cents higher than the February 24th contract high.

On April 22nd, July beans came close to the contract high (a double top on the chart is a technical indicator of a sell-off) and July beans sold down about $1.60 by May 9th. This past Thursday, July beans made its third run to the $17.40 area (a triple top on the chart). Old duffers will tell you double tops always hold but triple tops never hold. Such was the case yesterday as July beans exceeded the February 24th high by 3½ cents and the settlement was a new high settlement price as well.

Soybean stocks as of May 20 in CBOT approved warehouses (where they have to be to be delivered on futures contracts) are the smallest number of bushels in 7 years at just over 4 million bushels.


Introduction to Olga's Options

The purpose of this series of essays is to explain and teach how the many tools in the futures and options market can be used to generate speculative income as well as reduce the risk of adverse price change in the cash market. We will endeavor to do this by explaining the vocabulary and strategies in terms you can understand. Do not hesitate to ask questions.

There have been thousands of essays, websites, books and lectures to explain and teach exactly the same thing we are going to cover. The problem has always been everything you have previously read or heard about the futures and options market was authored by someone who forgot there was ever a day in their life when they did not know what a bear was, or a bull, or a long, or a short, spread, or the alphabet letters used to identify the months, etc.

If you pay attention, think about this information and find someone to discuss the vocabulary and concepts presented here, you will be shocked at how quickly this complex and scary material will make sense to you. If you do not talk to someone about it, it will take you a couple years and cost you about 10 grand if you start trading two or three years from now. We have clients who became successful traders in a matter of a few weeks, not because we told them what trades to do, but because they understood how the market worked and managed their risk to profit ratio properly. They already knew what they thought the futures market would do, they just did not know how to use the tools to make reasonable investments, place an order or even open a trading account.

Olga is Roger’s wife. She has been studying technical analysis pretty regularly for four years as she listened to me explain how the futures and options market worked to her and my clients. She has been trading her own account since March 2021.

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