Trading the Grains - Soy, Corn, Wheat

[brownsfan019 17]

Could someone tell me which of the following contracts is more advantageous to trade.

ZF or ZN?

 

Thank you

 

Gabe

 

ZF = 5 yr notes

ZN = 10 yr notes

 

This is the grains thread. I think you want this thread if looking for bonds.

 

[Gabe2004 10]

ZF = 5 yr notes

ZN = 10 yr notes

 

This is the grains thread. I think you want this thread if looking for bonds.

 

 

Sorry. You are right.

 

Gabe

[Dinerotrader 10]

BF,

Do you watch wheat or corn very much. I have only been watching soybeans but I took a look at the corn chart today and found the movements pretty tradable. I might have to take a few days to watch the corn charts and see how they trade on SIM.

 

[Dinerotrader 10]

Here is a quick look at the ZS with some timer perspective. I made the mistake of trading the movement in the danger zone today (see chart 2). The ZS can provide home run moves as well as some nice daily moves but they usually occur, IMO, once you've gotten the extremes of the range we are in. The middle chop area provides much less statistically sound trade setups so I always come back to the idea that I should just trade the best setups and not just any setups. You'll also notice that the speed of movement and volatility are much less exciting the days were are sitting in the middle of this zone.

 

Look at some of the moves on the first chart where price broke out of the zone it was in. Those could be days you make 3 month's worth of money if you can manage your risk appropriately with some additional contracts.

 

If you have some similar analysis on any of the other grains or a different perspective on trading the ZS please post something.

 

 

[brownsfan019 17]

BF,

Do you watch wheat or corn very much. I have only been watching soybeans but I took a look at the corn chart today and found the movements pretty tradable. I might have to take a few days to watch the corn charts and see how they trade on SIM.

 

I watch it but I just like the moves on Soy and get trades there just about every day so I focus there. Typically my grain trade is the last one of the day and I just focus on Soy b/c I like the movements.

 

Just make sure to watch wheat or corn intraday to get a feel for them. Not quite the same as Soy IMO.

[brownsfan019 17]

Here is a quick look at the ZS with some timer perspective. I made the mistake of trading the movement in the danger zone today (see chart 2). The ZS can provide home run moves as well as some nice daily moves but they usually occur, IMO, once you've gotten the extremes of the range we are in. The middle chop area provides much less statistically sound trade setups so I always come back to the idea that I should just trade the best setups and not just any setups. You'll also notice that the speed of movement and volatility are much less exciting the days were are sitting in the middle of this zone.

 

Look at some of the moves on the first chart where price broke out of the zone it was in. Those could be days you make 3 month's worth of money if you can manage your risk appropriately with some additional contracts.

 

If you have some similar analysis on any of the other grains or a different perspective on trading the ZS please post something.

 

Charts look good dinero! I don't really use the bigger timeframe or view much, so I don't have much to contribute there. But if it helps to post, keep doing it. Eventually we might snag an ES guy to come over to our side.

[Dinerotrader 10]

Charts look good dinero! I don't really use the bigger timeframe or view much, so I don't have much to contribute there. But if it helps to post, keep doing it. Eventually we might snag an ES guy to come over to our side.

 

It doesn't help you to see where things are at on a larger scale?

 

I always feel like my better trades occur at the range extremes so the larger time frames help me identify those.

 

What is the largest time frame you look at or thing is useful for you?

[brownsfan019 17]

It doesn't help you to see where things are at on a larger scale?

 

I always feel like my better trades occur at the range extremes so the larger time frames help me identify those.

 

What is the largest time frame you look at or thing is useful for you?

 

Currently I watch 1 chart per market. That's it. And currently the 1 minute chart is working fine. I could adjust that setting based on volatility. If you recall I'm looking to get in w/in the first 2 hours of a market being open, so I'm really interested to see what the opening prints are doing. I'm looking to make a trade based on expected volatility due to the opening of the market + econ news (if any). Coincidentally some of my worst performing days coincide with little/zero econ news.

 

There's nothing wrong w/ the approach you are taking here. I was doing the same thing at one point as well. I just turned a different corner at some point and haven't looked back. Once I decided I didn't need to peg every single move of every single day, a whole new world opened up to me - one where I could zero in on the most volatile part of the trading day and try to exploit that small, but very potentially profitable timeframe.

 

It's worked well for me but I'm not suggesting you or anyone reading this abandon what they are doing and just pull up some 1 minute charts and give it a whirl. I'm not even 100% sure how I got to this point but I did. And as long as it's working, I won't be changing too much to it. I've done that enough times that now I'm worn out from trying to hit every move and make a million bucks every day. I'll take a few hundred to a few thousand and call it a day.

[Dinerotrader 10]

Currently I watch 1 chart per market. That's it. And currently the 1 minute chart is working fine.

 

I am surprised you can watch soybeans on a 1 minute chart with the 1st minute being so fast. Don't you just end up with 1 big ol' candle?

[Gabe2004 10]

Coincidentally some of my worst performing days coincide with little/zero econ news.

 

Can you give some examles of the kind of news that will move the ZS?

Also is seasonality a factor in your trading?

(probably not because you mentioned that you use the same setup for all your instruments - if I remember correctly)

 

Thaks

 

Gabe

[brownsfan019 17]

I am surprised you can watch soybeans on a 1 minute chart with the 1st minute being so fast. Don't you just end up with 1 big ol' candle?

 

Sometimes I do but many times I'm not entering right on the open so things calm down a bit form there.

[brownsfan019 17]

Can you give some examles of the kind of news that will move the ZS?

Also is seasonality a factor in your trading?

(probably not because you mentioned that you use the same setup for all your instruments - if I remember correctly)

 

Thaks

 

Gabe

 

When I say econ news - I meant in general for the day. When there's news to be released, I usually have better days, which includes the ZS. I am not aware of any specific news related to the ZS that moves the market. I think it typically moves on it's own.

[Dinerotrader 10]

Here is where we stand on the ZS. A valiant effort to break higher today only to come right back before close. Just about the same thing happened yesterday except today the bulls had a little more gusto during the 1st hour of trading but they subsequently got beaten down the rest of the day. 2 tries at new highs and both tries failed.

I will be looking for a breakdown tomorrow especially since today's close was ended in a drop off.

 

I wish I could see a multi year chart of this so I could tell if seaonality affects the larger picture. If anyone has a larger scale chart, please share.

 

Edited December 1, 2009 by Dinerotrader
Good suggestion by BF to unclutter the chart

[brownsfan019 17]

Good look at the chart dinero. One suggestion - to get your chart less cluttered, you can turn the grid lines off. I think they just get in the way creating more stuff that's unnecessary. Go into the current profile >> thing in the top right corner to turn those off.

[Dinerotrader 10]

ZS

What was that spike! Is the chart correct?

 

[brownsfan019 17]

I saw that too... odd... not sure if that was real or not.

[Dinerotrader 10]

Might be a morning to trade corn. We'll see how price reacts to the support level this time.

 

[Dinerotrader 10]

Might be a morning to trade corn. We'll see how price reacts to the support level this time.

 

 

A nice load up on that one and you are done for the year.

 

[DugDug 10]

More of a daily longer term trade but i thought i would post it.

Wheat Mar10 - I like the fact that B is at a great level than A.

This occurred twice - the first as it tended to signal the end of the recent large decline from last year.

the second more recent one indicates to me that it is more likely to bounce off support and rally at least back toward B again.

I would enter a small amount on support, then enter more on a strong day, and look to run it.

Stop while i would position size off a stop at a close below 5 - I would tend to watch and any weakness below this level at 540 would probably see me cut it.

(this trade worked in mid Nov - catching some of the break above 525.

[DugDug 10]

I apologise - ignore the last chart it seemed to be the continuous futures contract from esignal, and not the actual march contract.

the march contract looks similar but is NOT yet at support for the actual contract - which is more like 510.

The error occurred as I had not rolled over this particular contract on this particular sheet.

Normally I trade off and look at the actual contract I intend to trade,

but I also look at the continuous contract for the general context.

Always best to look closer.

(Which raises an interesting question about support and resistance when it comes to futures contracts and the contango/backwardation S/R levels.

Support in one contract - is the based on that particular contract or for previous contracts - clearly not)

Edited December 11, 2009 by DugDug

[Dinerotrader 10]

Corn - ZC

1/10/10

 

Price is right near resistance and its had a couple tries to breakthough without success. Monday might be a good day for the bulls to finally give in and let this thing go. Not sure if the extreme cold weather is keeping prices up right now. I wish I had some fundamental understanding of the grains futures price changes just so I understood the big picture a little more.

 

[DugDug 10]

I have been watching this for a while....along with Wheat, which has been performing better.

For me - All the commodities are running which makes it seem more bullish, people are worried about inflation, the cold weather, etc;

I also have been reading a lot of info about people worried about supply issues with regards commodities this year, which mean that buyers may get a little desperate, and sellers may not be in a hurry to sell.

CTAs may start to switch shorts to longs if it breaks above 425 levels.

I also like that this is the third time at it, which for me means if it does break up, I would let it go.

Apart from all that.....as fundamentals , smundamentals if the price does not confirm it.

I have attached the same chart, with some very simple ideas attached - trend line, fib extension targets.

While I think there could be a small pullback - a rejection of a break eg; to 410, I would definately not wish to be short this.

[DugDug 10]

Doh!

looks like some USDA - I mean who the hell are these guys? Who do they think they are?

are going to spoil the corn party, as they think there is plenty of it around. This is going to hurt.:doh:

[Dinerotrader 10]

Wow, my first experience with a limit day. I wish I had kept my shorts from yesterday.

I can't imagine the feeling of those stuck on the long side of todays move. I am very curious to see how the movement is tomorrow.

 

[Dinerotrader 10]

Was everyone who trades corn waiting for that forecast to come out or does the USDA just come out with that forecasts whenever the want? I'd like to be prepared if forecasts are scheduled to come out on the grains. Anyone know about this?