Sweet Divergence

Here is a nice little chart in Sugar. It shows the May-Oct spread on top and the May contract below. May and October are in different crop cycles, so this is an old-new crop spread. The interesting thing here is how the spread was following the underlying, as you’d expect. Then it stopped and made […]

Some Thoughts on Corn

1. I saw some interesting stats the other day comparing 2012 with 1988 (chart below). Back then there were similar estimates for poor quality crops. Prices almost doubled then. We’ve gained only about 60% this year by comparison. That said the dollar value of the gain this time is more than double that of 1988. […]

Watch the Sky for a Corn Trade

I came across this chart in my travels. It’s quite an interesting one. It shows the relationship between the time a corn crop is planted and the subsequent yield. Contrary to popular thought, it shows early planting (i.e. early April) has little effect on yield, but late planting (i.e. May or after) has a dramatically […]

A Simple Spread in Crude Oil

Here is an interesting pattern in Crude Oil calendar spreads. The recent sell off in Crude was sharp and violent and suggested bear spreads (short near month, long far deferred) would benefit. Interestingly, bear spread took a long time to react, almost as if it was waiting for the market to hold lower levels before […]

Seasonal data reliability

Question: How reliable is seasonal data? Is making money from it all that simple? Answer: To answer the second question first – no it’s not always simple. Anyone that tells you they have a trading method that is foolproof is either a fool or a liar. This is why you need to get good information. […]

What is seasonal trading?

Question: What is seasonal data? Answer: The ProTrader Digest uses seasonal data in every trade selection. Seasonality refers to a pattern that depends on, or is controlled by, the time of the year. Seasonality appears in many places. For example, sales of Christmas cards logically peak before Christmas. Accounting business peaks around end of the […]

How to Trade the Crush Spread

One offshoot from the extreme volatility that came with the GFC is that many private traders are now looking beyond the simple strategies such as buying shares. This article takes a look at a risk friendly approach to trading Soybean futures.