In this episode of Tech Talk, Andy and Cody discuss CME cheese, whey, spot nonfat, and soybean meal.
Questions or comments? Charts you’d like to see? Contact us at Insights@Ever.Ag, or give us a call at (312) 492-4200.
Charts sourced from Ever.Ag Platform.
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00;00;00;17 – 00;00;08;21
VOICEOVER
Future trading involves risk and it’s not suitable for all. Investor contact provided in the statement is meant for educational purposes and is not a solicitation to buy or sell commodities.
00;00;08;23 – 00;00;24;15
CODY
Hello everybody. Welcome back to another episode of Tech Talk. I am Cody. He is Amy B per usual. It is 18th of October 20, 23, quarter to four Eastern time, quarter to two, no quarter to three Central Time.
00;00;24;17 – 00;00;29;09
ANDY
Three working clocks. Well.
00;00;29;11 – 00;00;29;29
CODY
Very well.
00;00;29;29 – 00;00;41;20
ANDY
Well, you know what though? A couple of things. Broken clock is right twice a day and somewhere in the world it’s 5:00. So it’s okay. These things are like it’s like ground control to Cody. Do you copy? Over, as you say.
00;00;41;20 – 00;00;44;16
CODY
You got it. You got a new little or read.
00;00;44;18 – 00;00;49;17
ANDY
You got to get changing things up around here. Just, you know. Anyways.
00;00;49;19 – 00;00;56;21
CODY
So we got three the same charts we did last week to double check in on them. And we have one soybean meal chart that people have been asking about.
00;00;56;21 – 00;01;09;13
ANDY
There has been some talk about meal for sure and we’re double checking on those other charts and like there’s this like new buzzword. It’s like we’re going to double click into though. So double click in each of those charts to dive in. How’s that?
00;01;09;13 – 00;01;11;15
CODY
So was double click rate, which is.
00;01;11;17 – 00;01;15;04
ANDY
Just double click or double clicking. So this is cheese. What do you think here?
00;01;15;04 – 00;01;29;12
CODY
Well, I mean, definitely broke out from the line that you drawn last week, which we did on we did the episode Thursday last week, this week, one in three. So the week is not complete, but I don’t think we were quite broken out of that downward turn there last week.
00;01;29;14 – 00;01;32;16
ANDY
So did what are we going to do a little bit below the bottom?
00;01;32;18 – 00;01;33;24
CODY
Yeah.
00;01;33;27 – 00;01;48;13
ANDY
I would agree. I mean, the futures are certainly acting that way. Huh. I mean, just a little bit here. I mean, just tighten things up a little bit. Cody, for you. Bam! There we go. Okay. Yeah. I mean, I drew that little, little bad boy right there. We sold this one, so it’s not really in play anymore, right?
00;01;48;15 – 00;02;03;26
ANDY
Right. But this one we have not. And so futures. Shoot. I mean, where is no futures here? 187 and some change. Nova saying we’re going to go right here. Let’s get rid of this guy for a second. Nova So this is where no futures are right now. Starting price in on Monday set, right?
00;02;03;29 – 00;02;04;18
CODY
Correct.
00;02;04;20 – 00;02;17;21
ANDY
For week month, you know, saying we’re going right here. So Nova saying we’re going to go sell this gap. It sure feels like it, too. I mean, the way the futures are acting was it was nearly a record day in class three volume for a single month, by the way. Nearly 1700 hours.
00;02;17;23 – 00;02;18;29
CODY
Yep. Close, but no dice.
00;02;19;06 – 00;02;24;14
ANDY
Close, but no dice. Just Cody. Close, but no cigar slots. Whatever. That’s okay.
00;02;24;16 – 00;02;39;17
CODY
I think I got a question for you on this chart. RSI is up in. Hasn’t gone into overbought territory yet, but the momentum has slipped and kind of heading a little bit lower. How do you judge those two indicators when they might not be moving in sync with each other?
00;02;39;19 – 00;03;04;09
ANDY
That’s a great question. You’re not getting any sort of confirmation on a secondary basis of any sort of trend. And, you know, I think it’s a really good question because to your point, you’re not getting they’re not lining up, right? Correct. But what’s interesting about this one is, is that you could argue that it’s it’s putting in a higher low, if you will, from here to here.
00;03;04;09 – 00;03;29;04
ANDY
Right. This on the RSI, the second one. And then, you know, here you want to be somewhat mindful of this because we’ve seen we’ve seen these types of indicators before. Like if you go back here, for example, I’m kind of dip in and then dip out, not really. So it’s it’s progression through zero that I think is really the most is I think I personally like momentum a little bit better, especially when you have like a big like you lose a crosses and then it continues.
00;03;29;05 – 00;03;47;10
ANDY
When I say cross, it goes from positive and negative or vice versa. Yeah. So this can be somewhat of like a false breakout, right? We definitely want to be mindful of it. We’ll see. But if if we continue to move higher, this theoretically should cross back over. But it’s like you’re it’s not really telling you anything right now.
00;03;47;12 – 00;03;47;17
ANDY
Right.
00;03;47;24 – 00;03;57;00
CODY
As a follow up to that, is there one that you should be watching over the other? Like should RSI come before a momentum indicator or should you use them both in conjunction?
00;03;57;03 – 00;04;25;11
ANDY
I’m like, yeah, it’s a it’s a matter of personal opinion. I prefer the momentum I like. I think it trades well technically and unto itself. So if I just go like this right, it’s really kind of like focus in on this bad boy right here. It can trend itself, right? So it broke through this trend here. You didn’t have to wait, necessarily wait for it to cross zero because it broke this long term downtrend it had.
00;04;25;15 – 00;04;45;15
ANDY
And it also I like the signals that it gives when you do have like a cross through it, like here to here. Right. Because it tends to do I think it does a good job predicting when when trends have ended. So that’s just my opinion. I don’t think Garza is bad. Don’t get me wrong, I like having a second secondary indicator is another like judge this.
00;04;45;16 – 00;05;03;18
ANDY
I think this is a fantastic job like the overbought and oversold piece of that. You have to be careful in that. You want to make sure that if you’re going to buy something, it crosses into oversold territory and then back out of oversold territory. So, you know, for here, for example, we just blow this bad boy up real fast.
00;05;03;20 – 00;05;24;25
ANDY
It crossed here and then, you know, you could theoretically draw like a trend that went from here to here. I guess let’s just do that real fast. Bam. So it breaks in, oversold, comes back out of it. That’s the blue line and then breaks through this what was kind of like a downward trend here same time across zero or broke that trend to see that whip from this this guy right here.
00;05;24;28 – 00;05;43;06
ANDY
Yeah so that’s that’s does those two indicators working in tandem and giving you a nice signal so that again when these two work together, I like them when they’re working again when they’re when they’re giving you the same signal, sort of speaker confirming each other, I think they work really well together. If I had to pick one, I’d choose the momentum.
00;05;43;08 – 00;06;01;24
ANDY
That’s for a different episode. Either way it looks, I would agree. It looks like we’ve got some sort of a V bottom potentially for taking CHAKER and the futures are telling us they’re going to fill this gap. So then it becomes a question of what if we don’t futures have really overdone themselves here. Then there’s been certainly has been some talk about that.
00;06;01;24 – 00;06;14;17
ANDY
Right. Like you had a commitment, a trader showed pretty big shorts from like a spec. So are we seeing those folks blow out? I don’t know. Maybe so. Yeah. Next step to the is going to go fill this gap.
00;06;14;19 – 00;06;15;05
CODY
Okay.
00;06;15;07 – 00;06;16;16
ANDY
You love gaps.
00;06;16;18 – 00;06;18;08
CODY
Love the gap gap chasers.
00;06;18;14 – 00;06;28;21
ANDY
Following up we looked at way last week this would have been the candle last week right here right And so the chart would have looked like this than now looks.
00;06;28;23 – 00;06;37;06
CODY
Okay so here’s one with a momentum in the RSI are working in conjunction with each other on the way up looking exactly how you think they would.
00;06;37;08 – 00;07;03;17
ANDY
Correct. And like you think about the secondary indicator, it’s it’s there to provide some confirmation of like a chart pattern that’s taking shape here. Right. So this is kind of like first and foremost, what’s the actual chart itself doing its price action? Okay. We had a big breakout. We had a big downtrend that we broke out from. You got confirmation here and it went into oversold territory and came back out of it.
00;07;03;22 – 00;07;21;08
ANDY
And then momentum turned to positive. Right. So you’ve had to your point, you’ve had both of those indicators giving you the confirmation that this breakout is valid. And now it’s like a question of where do we go? I think, you know, we talked about it last week, this noise, all this noise, all this consolidation. I think it’s just a big target.
00;07;21;10 – 00;07;23;25
CODY
After 45, $0.47, I think we had.
00;07;24;01 – 00;07;55;27
ANDY
Yeah, Yeah. And again, if you draw like that, you know the terminology retracement piece, if you hear or subscribe to that theory, I mean look at that. That goes right out in the smack dab in the heart of that stuff would be you know 33% retracement at 46 and some change. Interesting. I mean it’s interesting because in a way for for such a long period of time this year, you know, I shouldn’t say this year, I should say, you know, the better part of the second quarter, pretty much all the third quarter really didn’t have a material impact on class three.
00;07;56;00 – 00;08;19;07
ANDY
It was sideways. But now, you know, you start to really move here where it can be very impactful in a way goes from way goes from $0.35 to $0.50. That’s $0.15 times six. I can do that math. What is that, $0.80, $0.15 a pound and way is every penny away. $0.06 in class three. So that’s $0.80. Yeah. And I bet you like that as a farmer.
00;08;19;09 – 00;08;20;24
CODY
That’s pretty good.
00;08;20;27 – 00;08;21;20
ANDY
I’ll take that.
00;08;21;22 – 00;08;30;14
CODY
Yeah. Because we mentioned that in the last episode, right. Every penny in way you tack on $0.56. Six. Sorry, six. I confuses you.
00;08;30;16 – 00;08;50;27
ANDY
You get excited and that’s okay. I’m on my way to. We’re all excited about way. So. Yeah, but this looks like it wants to go back in and all this. Right. We got we broke out. You’re getting the confirmation from the secondary stuff. You got to be broke up until new highs from all this junk last week and then confirm that breakout this week by opening higher and then continuing to go.
00;08;51;00 – 00;08;53;21
ANDY
So it looks like all right.
00;08;53;23 – 00;08;56;10
CODY
Strong like a struggle.
00;08;56;12 – 00;09;03;02
ANDY
What do you think here, boss? Not that you have to hammer out on this one. It’s right here.
00;09;03;04 – 00;09;08;14
CODY
I think we’re going to have to. That looks like a buy.
00;09;08;16 – 00;09;12;15
ANDY
I could barely hear the hammer here. Yeah, so.
00;09;12;17 – 00;09;13;16
CODY
That would mean everything.
00;09;13;19 – 00;09;19;23
ANDY
Just sort of like that. How we need to build you a new house, if you like. That happens, Arizona. Shake the thing loose.
00;09;19;26 – 00;09;38;06
CODY
But not that kind of like dry way, to your point earlier was, you know, not doing a whole bunch of anything since March, going into September. Now it’s it’s honestly been, I think the one that’s been dragging class for hire day by day not marginally like better was doing but in the recent days it’s it’s given it a little bit of a boost here.
00;09;38;09 – 00;10;02;20
ANDY
Yeah yeah and we talked about last week this the 50 period moving average that’s a 50 week right this orange line right here. This guy looks like a pumpkin debt. It broke it close above that. We got to open higher this week. Not as pronounced as way, right? I mean, that can always like that one’s a lot of for this week is a lot more pronounced but you know we’ve seen this market trend obviously it has the capacity to trend.
00;10;02;22 – 00;10;20;07
ANDY
I mean look at this. We went from 31, 30 to 180 back down to 110. I mean, this one this thing wants to move. It starts to move tracked. So we’ve built a great base here, break up. You know, we had a nice breakout of this downtrend. So I would actually be more like here. Don’t know what’s going on with that.
00;10;20;09 – 00;10;35;19
ANDY
You had it. We had the breakout and I think you could actually draw this on multiple. There we go. That’s what I was looking for. So we broke out of the downtrend and then had built a nice face. That to me is a sign of strength. I think the next stop is to go test, you know, the 140 what?
00;10;35;19 – 00;10;56;13
ANDY
It’s 141 and some change. That’s 23% retracement of this big moves here. I’m only including you can include that if you want to be a little bit more conservative. But since we rejected this price so quickly, you know, I feel like it really was more like kind of, I guess, built a base more around this one to a number which would bring that 33% up.
00;10;56;13 – 00;11;20;05
ANDY
But if you want to be more conservative, that’s cool. And say it should be my hand. Yeah, there we go. Now we’re talking 136 137 Either way, I think we go and test whatever. It’s 33% retracement. You want to look at it and that takes us back kind of in this mean one thirties I think low one forties personally but at least mid one thirties area which by the way if we did that then you would cross over the 200 week moving average.
00;11;20;05 – 00;11;21;20
ANDY
This green guy right here.
00;11;21;22 – 00;11;27;26
CODY
I was just going to say that which we haven’t been I don’t think we’ve been above there since 2022 right here.
00;11;27;27 – 00;11;45;19
ANDY
Late 2020 to early 2023 right there. That would be I mean, like you’d have multiple moving averages giving you the indication that we’re starting to turn. So, yeah, broke out from this big downtrend, built a nice base or a long period of time and are now starting to trend higher out of all that. You’re leaving all of the selling behind, too.
00;11;45;19 – 00;11;58;07
ANDY
And you think about any any transactions here going to get left behind in terms of from the sellers perspective. So to me, that’s also the sign of strength, but that that’s things are percolating in the pattern, percolating.
00;11;58;09 – 00;11;58;29
CODY
Moving.
00;11;59;02 – 00;12;03;27
ANDY
I’ll tell you what’s moving, Neil, that several people reach out about this one.
00;12;04;00 – 00;12;06;20
CODY
A recent above 200 day moving average here.
00;12;06;22 – 00;12;11;27
ANDY
It closed above the 200 day it closed. It’s already been above the 50 day, the 20 day. I mean, this thing’s.
00;12;11;27 – 00;12;13;09
CODY
Cooking meals moving.
00;12;13;15 – 00;12;32;11
ANDY
I drew this just real fast. You know, it depends on where you want to where you want to have this. Right. I mean, the markets clearly didn’t like this for a seven for ten area, right? That’s a few times. And tried to get above there. It couldn’t even get a daily settlement above that. Price promptly rejected it. Trying to get back there again, promptly rejected and trended lower.
00;12;32;14 – 00;12;50;01
ANDY
That price looks like a magnet. If it breaks through it, then it’s then you got to go test this price for 21. I mean, it looks like that price also to them a lot of noise. They’re going all the way back to last year. Yeah, So you got a couple targets. But I mean, this candle looks phenomenal, broke out.
00;12;50;03 – 00;13;09;28
ANDY
I mean, if you just think about it, like from trended lower, broke out, did it in a way that’s, you know, we crossed zero here. Right? And then this is like this is the best that they could do. And then had another big day and then another phenomenal day. I mean, this thing that this is like it’s we’re going to go we’re going to be here in a few days and then we’ll see.
00;13;10;00 – 00;13;13;02
ANDY
But if you got to close it for ten or better, look out.
00;13;13;05 – 00;13;20;14
CODY
Let’s try to make a case of the Fibonacci retracement. And I just the way that I drew it, there’s not I mean, it does give you a good indication of anything in there.
00;13;20;18 – 00;13;28;09
ANDY
So question for you guys, is meal as good of a buy as not that.
00;13;28;12 – 00;13;29;21
CODY
Based on a chart specific.
00;13;29;28 – 00;13;35;18
ANDY
Chart Oh now what the tea leaves of course the chart we talked to you are based on.
00;13;35;20 – 00;13;40;15
CODY
Yeah I mean look at this chart right here. Absolutely. It looks so you showed me you.
00;13;40;16 – 00;13;47;21
ANDY
So if you could buy, like, a load of meal or a load of nonfat, like a tote bag, if not you, which one would you do?
00;13;47;23 – 00;13;51;15
CODY
If I had to pick, I would pick. If I had a pick that way, I would go nonfat route.
00;13;51;17 – 00;14;08;01
ANDY
You go nuts. All right. You hammered your desk hard on the downside. Like, I mean, it’s like you did. I just now felt the shockwaves here in Wheaton from Allendale or wherever he lives for on the hammer pages, about to see all of the city. So.
00;14;08;03 – 00;14;30;28
CODY
I mean, you’re looking at nonfat. We’re out of, what, a buck 22. And we’re talking about possibly going back to a dollar, $40, 41 with what you’re looking at right here. Okay. If we don’t break through that dollar or 407408 type number, then the risk reward here is not as good to me as it is in not. Look at the chart, right?
00;14;31;00 – 00;14;31;10
ANDY
Yeah.
00;14;31;14 – 00;14;37;15
CODY
Not too far away do we go crashing right back down to 370? I don’t really know. I’m not sure.
00;14;37;17 – 00;14;38;29
ANDY
Sure when we get to the chart.
00;14;39;02 – 00;14;48;08
CODY
But it does look fairly bullish at this point, right? I mean that’s that’s a strong candle says Yeah.
00;14;48;13 – 00;15;17;17
ANDY
I mean I think it depends on kind of your time horizon for the for if you want to buy something too and what does it say like a fair question. Sorry, I kind of put you in a bad spot but that’s a they like short term buy Nielsen Sure. And probably have like you know if on it have a stock below probably today’s call are open you know just just thinking out loud where you want to have you know like you know an out so to speak and you know let’s say you got to move to 47408 and then you started to do one of these like you to do, then you probably want to
00;15;17;17 – 00;15;24;10
ANDY
at least be tightening that stuff up or get out or whatever. But if you get too close at four, ten or better, like it’s I think that’s a straight shot for 20.
00;15;24;12 – 00;15;36;17
CODY
If we start doing like we did back in the middle of July, the we got to 18 through the 26, 27th there. And then you, you know. Right. It’s kind of exhausting, of course.
00;15;36;19 – 00;15;39;18
ANDY
Yeah. All right, cool. That sounds good.
00;15;39;20 – 00;15;41;20
CODY
Those are great charts, great returns.
00;15;41;20 – 00;15;46;00
ANDY
That was, you know, great charts. Great episode, great hammer. Just like bam, like.
00;15;46;02 – 00;15;54;17
CODY
Hey, speaking of great episode next week, our always anticipated Halloween episode for tech talk.
00;15;54;20 – 00;15;55;17
ANDY
Is it?
00;15;55;19 – 00;16;15;01
CODY
It is. It’s going to be good. It’s going to be good. So everyone, get ready for Andy and I are about to prepare the cast. We will do. Aaron, we appreciate you tuning in this week, everybody talking about soybean meal here next year to talk about. But until then, everyone have a great week. Fantastic weekend. We’ll see you for the Halloween episode next Thursday.
00;16;15;05 – 00;16;20;27
ANDY
We’ll see you Thursday. And maybe Cody will wear something other than a black shirt. We’ll see who does. It’s all.
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