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How to trade corn (in general) Monday 3/29/2021 03:35:00 PM CST Tweet

The corn is one of the less volatile among the grains which makes it easier to trade and many say that if you can't trade, you should trade corn. Maybe that is why I'm into that market.

So how to trade corn?

The corn is planted in spring and harvested in autumn which makes it most volatile during that period of time. Traders, hedgers and farmers become very active during that time and they look for any threats that might harm the production whether it be the weather or any other factors and they will be very nervous and active during that time, bringing more liquidity and moves to the market. So here we pay closer attention at the supply - whether there will be good crop to deliver. On the other hand during the winter time there the market will be driven rather by the demand - whether there are enough buyers for the production that is already harvested and stored.

Currently being in spring, the planting season, we should discus the so called "planting intention" - USDA estimates how much acres US farmers are intending to plant with corn. This estimation will give us approximate understanding of the volume of the production in the end of summer/beginning of fall. But still this is just a rough idea and that is why it is called intended. The next important thing is to see what corn goes into production of - almost a half of the corn goes into production of ethanol (which makes bio-diesel) which make corn price very inter- and co-related ethanol and oil prices (higher oil prices - bigger demand for cheaper alternatives as bio-diesel). The other half goes for live stock feed and only a very small portion goes for human consumption. After corn being planted we start looking at weather during summer months. Heats and droughts in summer months in US mid-west are no friends of corn. Such news would damage the crop and reduce harvest yields which of course would drive prices higher.  Respectively good weather conditions in Iowa, Nebraska, Illinois, Indiana and Ohio would result in better yields and prices could go lower on bigger supplier. So to sum it up - the summer is about supply. Based on above the highs of corn during the year are seen during June and July; however this is just generally speaking and this is not a rule at all. The winter, on the other hand, is more about the demand. It is rather more quite time, less volatile without big spikes in price.

For me it is the most appealing trading corn using futures contracts; however the very same market can be traded as options, spreads, CFDs or ETFs whatever is best for the trader.


From cyberpunks to crypto-anarchists Wednesday 3/17/2021 06:00:00 PM CST Tweet

Back in the days when I had encountered email encryption, I was so fascinated with the idea of sending and receiving anonymous messages that I had to dive deeper into this. Thus I installed a PGP software to my email client without knowing that it would lead to something bigger. 

Now from the perspective of nowadays' more and more technological society, I think that the cryptology have its bigger stance. Back there in the 90s I thought that the internet was truly free and anonymous. Now some 20 years later, it appeared that it was not the case. Currently, we are not anonymous and we are not free at all in the internet, being tracked and even spied by tech corporations and governments. But there is still hope that I and all we, cyperpunks, cling to. 

There in 2008 a remarkable invention was made - a person or group of people implemented and released as open-source software a digital currency called Bitcoin. The most astonishing thing was that it was a decentralized currency, a peer-to-peer network allowing people send and receive money without any intermediaries. And when I think about decentralization, it pops up to my mind the name of one of Russia's prominent anarchist - Peter Kropotkin who described the world free of central government, a world based on voluntary associations of people. And it sounds so beautiful! But we are still not there, not even near. So today we live in a world that is dominated by a very centralized small core of people.. 

How did we arrive here? I don't know but I know that it pushed us to invent such things as blockchain and crypto which would allow us to liberate from current state. The surveillance, whether it be analogue or tech-related, forced us, to try hide things, hide names, hide everything. This is the true origin of open source and cyber-cryptography used by ordinary person. There is the government or the corporation on one side and ordinary people, empowered by technology, on the other side, fighting the corporation. “Cypherpunk. It’s just a couple of people who have dealt with cryptography in a punk way, which is: Do it yourself. Don’t ask permission,” Smuggler.

We don't ask for permission because we believe that everybody should do what they want to do without harming others but having the freedom to do it. This way the cyberpunk movement evolved in practice to crypto-anarchy which in the end became a whole philosophy of using cryptology and technology to build communities that are invisible to the state and the corporation.


Stooq 3/17/2021 07:44:00 AM CST Tweet

There is a very cool Polish web site for quotes and charts. It’s called https://stooq.com/ and I like it as it’s easy to use and charts are quite old-fashioned which appeals quite a bit to me. They also have a nice and easy-to-use mobile app. 



mini corn example Monday 2/08/2021 11:41:00 AM CST Tweet

This is another example of trading mini corn futures. Mini corn $xc_f are good for trading with smaller capital or for strategies with bigger contract size. Once we have a valid break out, we enter 2 contracts. In our case long 2 March mini corn contracts. Setting stop loss and take profit targets. If the trade is in our favour, we can exit 1 contract at profit and reset second contract's stop loss at break even and let the order run in profit as much as possible. 

In below case there both take profit contracts were triggered too early and I didn't manage to let half of the trade run; It was a good runner though..




If you can't trade, trade corn 2/01/2021 05:51:00 PM CST Tweet

It is well-known saying. If you can't trade, trade corn. That's all about me. As many traders, I've been all around the world of trading. Starting with forex and CFDs, going through stocks, finding the universe of options and finally settling at futures. At first trading ES minis and in the end ending with grain futures.

End-of-Day price quotes for Mon, February 1, 2021 

Symbol    Last    Change    %Chg    Open    High    Low    Volume    Time
ZCH21    549-2s    +2-2    +0.41%    549-0    555-6    539-0    202,570    02/01/21

I've been trading corn futures today. Especially the minis of corn. First of all when it comes to mini grain futures, it is good for trading with less capital but one always has to have in mind the lower liquidity and and bigger spread. 

They say that grains are easier to trade as there is less noise compared to indices for example and trends and break-outs are easier to identify. Mini grains are even more less noisy and quite slow-paced markets.

On the first chart of mini corn March 21 contract, after pit open, we are staying in side-lines and in first hour of trading, setting support and resistance levels at the low and the high of the day. As soon as the either one is broken out, we are placing an entry order. In our example it is sell to open limit order at $5.45 1/2. I also placed a stop loss order at high of the day of $5.55 and take profit somewhere at $5.30; however as price action showed signs of reversal, I decided to exit at $5.42 3/4.

From below chart it is clearly visible how market proceeded trading and bounced higher from the lows of the day.



What is needed to say that grains are not that easy as it is said and it is the same market as all others with it's own rules and flow. The most important is to find the market that appeals the best and stick with it. 

Today's trades:

Sell    1    XCH1    Limit    545 2        Filled    Entry    1    02/01/2021 17:32:10    545 2
Buy     1    XCH1    Limit    542 6        Filled    Exit     1    02/01/2021 17:43:25    542 6

Gross P/L    $25.00
Fees Comm    $(2.28)
Net  P/L     $22.72

Last post for the year Thursday 12/31/2020 02:40:00 AM CST Tweet

This would be the last post for the year. There will be no pictures or charts and it's going to be rather more textual as I like it. Back in the days of trading when there were no charts or computers, it'd been more about the craft and connection between the traders and the market, information flow, data and careful analysis. Nowadays everybody with a smart phone in their palm and some questionable app may invest or even day trade which seams to me a non-sense. My resolution for the upcoming year and the traders out there is to pay more attention and learning the craft, paying respect to the market and the other participants and master their trading as art.


Wheat breaking down - first trading hour Wednesday 11/18/2020 09:57:00 AM CST Tweet

Wheat (ZWZ20) December contracts opened with a slight push up and after hitting high of the day went lower during the first trading hour. Here's a great example of drawing support line and waiting for price action to break lower for an enter and profitable trade.

From the very open of the market the price hit support at $5.97/bu and tested it going lower after the first 30 mins of trading. A small pull up and second test of the support and the break down for an instant entry. 

Grains tend to trend 11/11/2020 02:57:00 PM CST Tweet

What is interestng about grain futures is that comparing to intices there is not much noise and they tend to trend intraday much often and much clearer. It is quite easier to recognise intraday trend and breakouts as to enter for a trade. For example today 11.11.2020 wheat and cron

Mini wheat at open Tuesday 11/10/2020 09:35:00 AM CST Tweet

This is a very simple and good working strategy for day trading grain markets. Once the grain futures market opens at 8:30 am Chicago time (16:30 which is the time in my case), we tend to stay in the side lines waiting to see for direction. It is good to wait for an hour or so as to let the market trade. After the first hour, I draw support and resistance lines simply at the low and high of the day and waiting for a valid breakout. If the price breaks out either direction, we enter and put take profit at 10 points and stop loss at 6 points. In case the trade is a runner, we can move stop loss above break even and let the trade run. 

B/S    Qnty Contract   Price    Date & Time

Buy to open   1 XWZ0 Limit $604 5 Filled 11/10/2020 17:06:24 
Sell to close 1 XWZ0 Limit $605 7 Filled 11/10/2020 17:13:04 




Chicago skyline Monday 11/02/2020 03:31:00 AM CST Tweet

Chicago - the centre of futures trading. The skyline is amazing. It's early Monday morning and we're all looking forward to the start of the trading day.



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