December Corn: Dec25 completed a bullish spike reversal during August. If the market is in a major (long-term) sideways trend, then a move toward the high end near $4.80 would be expected over the coming months. It’s likely Dec25 established the high-end of a potential major (long-term) sideways range back in February at $4.7975, similar to what occurred during the winter of 2014-2015. Recall this sideways pattern would last through the fall of 2020. If Dec corn is in a new major sideways trend with a high-end near $4.80, the low end would be the August 2024 low of $3.8550. The range back in 2014 to 2020 was from the low near $3.20 (September and October 2014) through the highs near $4.20.
Theoretical Positions:
- Hedgers:
- See Weekly Analysis: Grains (both Futures and Cash)
- Investors:
- Long Dec25 futures from $4.2650 were rolled to Dec26 futures at 2.0 cents carry on Friday, January 31
- Dec25 could’ve been sold at roughly $4.6025
- a gain of approximately 21.5 cents
- in addition to the gain of about 12.0 cents on the previous Dec24 long futures position
- a gain of approximately 21.5 cents
- Dec26 could’ve been bought at roughly $4.6225
- Dec25 could’ve been sold at roughly $4.6025
- Long Dec25 futures from $4.2650 were rolled to Dec26 futures at 2.0 cents carry on Friday, January 31
- The bottom line is long-term Investors will want to still be long Dec corn based on the bullish spike reversal at the end of August 2024 on the continuous monthly chart confirming the end of the previous long-term downtrend from May 2022 (See Monthly Analysis). At the end of July the investment position would be approximately:
- Short Dec25 near $4.61 based on a number of short-term option trades
- If not done already (see Weekly Analysis), these positions would be bought back near the August close of $4.2025 for a gain of roughly 40 cents.
- Long Dec25 $4.20 calls at 20 cents
- using half the gains from previous short option positions
- These options close August at 14 6/8 cents
- Long Dec26 near $4.6225
- Dec26 closed April at $4.5925
- Short Dec25 near $4.61 based on a number of short-term option trades
Teucrium Corn Fund (CORN) is also in a major sideways trend. CORN closed August at $17.57, down $0.31 for the month and completing a bullish spike reversal. Theoretical Positions: CORN could’ve been bought near the August 2024 settlement of $17.70. Additional longs could be established on buy stops above the previous 4-month high of $18.85 during January. If so, then the average position would be near $18.28. Sell stops would be below the major low of $17.02 from August 2024. It’s possible these stops were triggered during August. However, given the market was rolling from old-crop to new-crop, and the Dec25 remained bullish, sell stops may have been cancelled before hit.
November Soybeans: The continuous monthly chart for November soybeans continues to show a major sideways trend. Theoretical Positions: Traders would’ve gotten out of short November 2024 futures positions before the contract moved into delivery at the end of October. There are no November 2025 positions at the end of August, though buy stops could be above the previous 4-month high of $10.7425 (June 2025). Nov25 closed August at $10.5450.
The Teucrium Soybean Fund (SOYB) looks to be in a major sideways trend. Theoretical Positions: Investors might’ve bought near the December settlement of $21.48 with sell stops below the December low of $20.20. Some may have added long positions near the April settlement of $21.47. SOYB closed August at $22.39, up $1.18 (5.5%) for the month.
The Teucrium Wheat Fund (WEAT) remains in a major downtrend as it posted a new low of $4.17 during August before closing at $4.28, down $0.07 for the month. Theoretical Positions: Investors are likely on the sidelines with WEAT, though new longs near the August settlement have low risk.
