Note: I’ve changed the Monthly Analysis of the Grains sector, looking at the long-term investment side with ETFs for the three major markets as well as continuous December corn and November soybeans monthly charts. I’ll discuss the National Cash Indexes for the five major markets (corn, soybeans, three wheats) in Monthly Supply and Demand Commentary based on the idea these Indexes are the key read on real fundamentals.
Teucrium Corn Fund (CORN) remains in a major (long-term) 5-wave uptrend. CORN closed March at 18.56, down $0.51 for the month and the second consecutive lower monthly close. This looks to be a Wave 2 selloff within the 5-wave uptrend pattern, with continued pressure expected during April. Theoretical Positions: CORN could’ve been bought near the August 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 left below the major low of $17.02 from August 2024 for now.
December Corn: There is a lot going on with the long-term continuous monthly chart for Dec Corn futures only. To begin with Dec25 posted a bearish close to March, finishing at $4.42, down 13.0 cents for the month. It’s likely Dec25 has established the high-end of a potential major (long-term) sideways range, 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 for 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 for roughly $4.6225
- Dec25 could’ve been sold for 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 on the continuous monthly chart confirming the end of the previous long-term downtrend from May 2022 (See Monthly Analysis). At the end of March the investment position would be approximately:
- Short Dec25 near $4.70
- Dec25 closed March at $4.42
- Sold short-dated new-crop May $4.40 puts for 11.0 cents (March 28)
- These options closed March at 7 1/8 cents
- Long Dec26 near $4.6225
- Dec26 closed March at $4.4775
- Short Dec25 near $4.70
The Teucrium Soybean Fund (SOYB) remains in a major 5-wave uptrend, with the extended selloff during March looking to be part of a Wave 2 move. If so, then SOYB could test the December low of $20.20 over the coming months. Theoretical Positions: Investors would’ve bought near the December settlement of $21.48 with sell stops below the December low of $20.20. If options are available for SOYB, June $20 puts could be bought to protect against the Wave 2 selloff. Otherwise, investors could look at buying puts against the July futures contract.
November Soybeans: The continuous monthly chart for November soybeans continues to show a major sideways trend. It should be noted the Nov25 issue posted a new 4-month high beyond the previous marks of $10.66 (January) and $10.6975 (September 2024) during February, but has since closed lower 2 consecutive months. Theoretical Positions: Traders would’ve gotten out of short November 2024 futures positions before the contract moved into delivery at the end of October. If buy orders were triggered with the new 4-month high, roughly $10.70, then sell stops would be below the previous 4-month low of $9.61. It’s also possible these new longs were stopped out at February’s lower close.
The Teucrium Wheat Fund (WEAT) erased its previous major uptrend as it fell to a new all-time low $4.55 during March before closing at $4.68, down $0.15 for the month. Theoretical Positions: Investors were likely stopped out as WEAT took out its previous low of $4.64 from January 2025.
