Andy reached out a few weeks ago and stated he was glad we did not panic sell when May Futures were trading near 580.
We identified several technical signals suggesting the price would find a local bottom, avoiding capitulation and panic sales.
The price is now trading at $60/tonne higher.
It is always nice when the ideas work out.
Canola is on a lot of people’s minds, raising several questions.
Do I sell?
Do I hold?
At what levels should I sell?
What are some Futures strategies to use?
Is the trend changing?
We will try to answer some of those questions today.
Our previous analysis provided the following comment when May Futures was trading at 625.00.
Here are two ideas for those who have sold Canola and desire to capture a move to the upside:
These are just ideas, not recommendations.
Make the Trade Your Own.
LONG Canola above 630 to 650ish. STOP below 629.
LONG Canola on a pullback to 600-608. STOP below 597.
As the chart below displays, the price reached a high of 652.10, triggering our sale at 650 for an approximately $20/tonne profit.
We can add the $20/tonne to our previous idea to LONG above 606.55 to 628.00, which produced a gain of $21/tonne.
The total gain for the two ideas is $41/tonne.
Having a disciplined trading plan, using stops and take-profit levels producing small gains is critical for success using futures.
Home runs are nice, but making base hits is easier.
The May price returned to 615.70, not reaching our target range of 600-608.
So now, one looks for levels to become bullish.
Remember, these are educational ideas, not recommendations.
Make the Trade Your Own.
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