I put out a few StockTwit tweets on Corn last week, but I wanted to organize them into a post. So here we go.
Despite the sell off since the summer, we did not hit oversold and instead came down to be forming a double bottom with 2014 lows. I like that.
It goes further back if we check out the monthly:
For my needs, I will be taking a position in the $CORN ETF. I see an inverse head and shoulders here, testing the neckline, along with some nice volume. I have scaled in and am long a position risking 1% of my capital.
Price target? I am not expecting the moon on this. We do have the downward sloping 200 day moving average above. The 68.1% fibonacci extension gives us 393, ~15% higher. The 61.8% on $CORN equates to 21.40.
The last aspect is how net long Producers & Users are. Almost as much as they were before the rally into the summer. I like that too.
Seasonality does seem to be lining up accurate this year though, which could be a damper.
Corn’s been down since mid-June, just like the chart above. Maybe we don’t get a rally until the end of the year or maybe the producers & users are right and it comes sooner. Lets see.
Time is on my side when I take positions. If this doesn’t move by tomorrow, I am not going to close my trade.