In this episode of Tech Talk, Andy and Cody discuss Jan class III, heating oil (diesel), the DOW and the S&P 500.

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00;00;00;17 – 00;00;08;29
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;09;01 – 00;00;19;12
CODY
Hello everybody. Welcome back to another episode of Tech Talk. I am Cody. He is Andy from Chicago Office. The room that Jim MATTHEWS built.

00;00;19;15 – 00;00;23;23
ANDY
Coming from from Jim MATTHEWS. Now I’m just a guest here.

00;00;23;25 – 00;00;24;18
CODY
You’re just a guest.

00;00;24;18 – 00;00;27;22
ANDY
And I’m just in Matthew’s palace right now.

00;00;27;25 – 00;00;30;19
CODY
We’re all just a guest in Jim’s World at this point. My friends.

00;00;30;19 – 00;00;40;01
ANDY
Really are. I mean, you know, it’s an honor and a privilege to be able to sit here state, especially with somebody that’s got a hat like that. I mean, it’s just unbelievable.

00;00;40;03 – 00;00;43;17
CODY
Telling you that talk cowboys coming at your hat.

00;00;43;22 – 00;00;47;15
ANDY
Now when you do finger pistols, by the way, are you a101.

00;00;47;17 – 00;00;49;16
CODY
Finger double barrel, old time, double barrel.

00;00;49;17 – 00;00;50;14
ANDY
Barrel. All right.

00;00;50;14 – 00;00;52;03
CODY
So shirts today.

00;00;52;06 – 00;01;01;11
ANDY
Three charts. Ooh. Well, we were talking here. James is part of the new low for the day. We just had this bad boy of 1611 last year. The price that’s. That’s before we started filming.

00;01;01;11 – 00;01;03;02
CODY
Yeah, I mean, literally just now.

00;01;03;04 – 00;01;18;08
ANDY
Yikes. All right, well, Jan starts pricing next week, and I believe it’s a four week month. You can learn more about pricing with three bases loaded. Joe Schmidt, Jerry Moore, I know that doesn’t look good like today. Just now, while we were filming, putting the new contract low, it looks like.

00;01;18;11 – 00;01;19;03
CODY
Yeah.

00;01;19;05 – 00;01;19;27
ANDY
Yeah.

00;01;19;29 – 00;01;20;27
CODY
I mean, you went from the.

00;01;21;04 – 00;01;21;11
ANDY
End.

00;01;21;11 – 00;01;28;17
CODY
Of November at what, 16, 14 up to $17 and then promptly broke that in about six, five, six trading days.

00;01;28;24 – 00;01;48;25
ANDY
I mean, it’s tough to argue with this big trend and it’s got going on, right? I mean, it started at 19 bucks trying to get through it here. Right. Look like we’re getting ready to go. And there was a little bit of building in the cash market and yada, yada, yada. Just kidding. Yeah. So I don’t know if this downturn is holding really well until it gets broken and then subsequently has like I mean, open higher the next day.

00;01;48;27 – 00;02;03;29
ANDY
So we started that way, right? And you gotten like a $70 plus open the next day. You can trade at 17 and a half. I mean, you know, it still could happen, right? But holding below this downtrend right now and then putting in a new low like this, let’s say we’re going to open lower tomorrow. So tomorrow’s Friday.

00;02;04;02 – 00;02;10;00
ANDY
I mean, you can just continue to keep putting pressure on, especially with the way they keep beating up gas, too.

00;02;10;02 – 00;02;29;19
CODY
Yeah. I mean, the big cash up today, I guess the interesting thing is we settle January 16, 24. Okay. And I mean, like you said, as we were talking, so 310 Central Time, I mean, just just broke that market from 1620 ish all the way to 1611.

00;02;29;22 – 00;02;30;08
ANDY
Yeah.

00;02;30;11 – 00;02;32;03
CODY
Hey, how you doing? See you later.

00;02;32;06 – 00;02;45;25
ANDY
No. Good. I feel like people are looking at this market and saying this is like a break to buy. And, you know, we’re getting to like the lower end of the range that we’ve been on. And maybe that’s true. I mean, when they take the barrel below a dollar 50, it seems to probably pop back up. But the way this is trading is certainly isn’t acting that way.

00;02;45;25 – 00;03;03;07
ANDY
I guess I like the momentum here. Try to get over zero can do it it trying to get something going with this RSI right here and failed again so you’re not getting any sort of confirmation from any of the secondary stuff you tried to break out failed. I think if you’re looking to buy that, you need to get a little bit better confirmation, something.

00;03;03;07 – 00;03;18;05
ANDY
I mean, maybe like just throwing ideas out there. Like if you saw like a hammer type formation, that would be good. It’d be a nice indicator to get long, but I don’t know, it just the new contract lows right before it starts pricing next week. And so it’s not that big of a premium either, right? I mean, it’s I 15 and a quarter using current cash.

00;03;18;05 – 00;03;37;18
ANDY
So that’s adding, you know, five, $0.06. I think it’s pretty fair. So it’s probably more like a 1575 ish, 1580. So at 1611 2037 premium, I probably more like 30 or 40 set premium, but not, not that big of a premium. Right. It is probably going to continue to trade alongside cash.

00;03;37;25 – 00;03;42;03
CODY
Yeah. Yeah. Like you said, it’s not as massive as it was last time we talked about it.

00;03;42;05 – 00;03;42;21
ANDY
Sure.

00;03;42;24 – 00;03;45;02
CODY
There was a good 60, $0.70 built into it.

00;03;45;04 – 00;04;06;14
ANDY
And just looking at it again, it’s it’s technically like this. If I can just pull this off for a second. You had an attempt to break out failed and then the subsequent you know, action out of the, you know, the attempt to, I guess, recoup some of that break from buyers, even just from here to here. I mean, if we haven’t even gone and tested like the 30% retracement, if you use this low or the one third.

00;04;06;14 – 00;04;22;08
ANDY
So it’s this right here, this consolidation after attempting to break out and then a new low and that’s a sign of further weakness stuff because now you’re going to start to have to get like some of these lower. You get to take cheese down or get some of these lower, like see prints actually make it into the PSR.

00;04;22;12 – 00;04;30;06
ANDY
So, I mean, if you’re looking for an opportunity to buy it, a reason to buy it, it’s not really giving you one. It’s not exactly what you want to hear as a dairy farmer from your perspective, right?

00;04;30;08 – 00;04;48;26
CODY
Not really, Especially. I mean, like you said, when literally we started filming this, we watched it just break another nine, $0.11 lower. I mean, just like that was kind of odd to see. But the interesting thing is, is on this channel, like look at seven March, obviously into new lows and just kind of continually pushing themselves lower.

00;04;48;26 – 00;04;53;26
ANDY
Yeah, yeah, yeah. Oh, maybe that that will help. Well, how about.

00;04;53;29 – 00;04;55;22
CODY
We got to get everything we can right now?

00;04;55;24 – 00;04;56;23
ANDY
I mean, that’s sweet.

00;04;56;29 – 00;04;58;28
CODY
Thank you. I appreciate that. I mean.

00;04;59;01 – 00;05;06;13
ANDY
This chart doesn’t look great. Your had, on the other hand, looks great. I didn’t get one of those that I need to get one that a ten gallon have. What? What, what? What is that?

00;05;06;17 – 00;05;13;20
CODY
I know it’s a Stetson Stetson hat. I heard those are good or no new to this cowboy thing, my friend.

00;05;13;22 – 00;05;15;26
ANDY
You knew that? Well, there, the.

00;05;15;26 – 00;05;17;00
CODY
Hat part of it.

00;05;17;02 – 00;05;26;18
ANDY
I was going to say. All right, so this one look, this one came me request. You want to look at this one? Yeah. I’m from the. The guy’s a diesel there. So what am I talking about? Diesel.

00;05;26;25 – 00;05;31;28
CODY
They swear every ranch needs diesel for their truck. And that’s why we need to look at diesel today.

00;05;32;01 – 00;05;34;09
ANDY
So what are your thoughts here? You know.

00;05;34;15 – 00;05;52;03
CODY
You know, I think, you know, I was talking about this with somebody yesterday about, you know, January heating oil, diesel on the CME. And I said it looks like we can possibly go down and test that 240 mark that we were at the beginning of June-July. Were we kind of just stagnated ourselves for about three months there and then really rallied.

00;05;52;05 – 00;06;10;07
CODY
Yeah. So I think right now a lot of folks are saying, okay, we got harvest that’s over. We have things that we need to buy for next year going into spring planting, looking ahead, trying to get some opportunities bought in. Diesel is just kind of been a slow trickle down with a few big rallies and they just have not been able to sustain themselves.

00;06;10;09 – 00;06;30;14
ANDY
Yeah, I mean someone reminiscent of milk, right? Right. Man, you’ve got a lot of different you know, if you want to draw a multiple field, you can have multiple trends. We’re running here, right? So here I think is another good one. Either way, you got 1 to 3 new, you know, like new lows, so to speak, right? Yeah, I agree.

00;06;30;15 – 00;06;53;18
ANDY
I mean, this is this price right here. It was you know, this is a great example of like an a like an ascending triangle. Right? So you have one, two, three, four new, like higher lows, bumping up against the short, basically one horizontal line. It’s a great indication potential for volatility in it. And it certainly panned out. But it’s also tells you like it becomes sort of a magnet, too, once this ends.

00;06;53;20 – 00;07;06;25
CODY
I was just going to say it almost looks like a long term magnet. Mm hmm. You know, where we sit there? Maybe it is for a few months, maybe it’s not. But it almost looks like that. Two 4235 number once you’ll get tested yet again.

00;07;06;28 – 00;07;11;21
ANDY
So ipso facto you’re going be able to fill your truck up. Well, cheaper is what you’re saying.

00;07;11;23 – 00;07;28;05
CODY
I mean at those prices. Yeah. And that’s the interesting thing is trying to put a basis on top of that of where diesel is delivered, talking to different folks throughout the country. Even if you throw, what is it, 40 to $0.50 ish. On top of that, you know, you get down there, you’re talking to 60 to 70 diesel.

00;07;28;12 – 00;07;35;18
CODY
Right. It’s a big ish, right, depending on where you are. But they fill up those trucks a lot cheaper than you can today.

00;07;35;21 – 00;07;44;04
ANDY
So you’re selling diesel or diesel, you’re selling heating oil. You’re saying we go to 240 and then probably consolidate, right?

00;07;44;06 – 00;07;53;07
CODY
I do even I just looked at it on a monthly chart. Okay. You get down to 20, which we kind of bang those lows out during May, June of this year.

00;07;53;10 – 00;07;53;29
ANDY
Yeah.

00;07;54;01 – 00;07;59;08
CODY
And making it, I don’t know, I guess I guess a sloppier information here.

00;07;59;15 – 00;08;01;21
ANDY
I see what you’re saying. So.

00;08;01;23 – 00;08;02;27
CODY
Yep.

00;08;02;29 – 00;08;17;19
ANDY
Yep. Yeah. I mean that’s even lower than what we were looking at. But for sure, I mean this is, this is that 240, this is that area of consolidation right there. Yeah. And to your point, you’ve got I mean, this cannot be any more clear. This is quite the lower high, right?

00;08;17;22 – 00;08;18;17
CODY
Correct.

00;08;18;19 – 00;08;43;00
ANDY
I agree. I mean, let’s say you want to go get into this this little small range here, so. Oh, wait, fill the trucks up. Give us the cheaper, like all cheaper. Who knows? I’ll tell you what is rocking and rolling. Oh, absolutely. Rock and roll. And not only is Cody going to be able to fill this truck up cheaper, he’s going to retire sooner courtesy of this is the Dow stocks.

00;08;43;00 – 00;08;45;04
ANDY
I mean, they just this is this is rockin.

00;08;45;10 – 00;08;46;13
CODY
That is looking.

00;08;46;13 – 00;08;50;24
ANDY
Good. Look at that thing we talked about. You know, we talk about like wealth effect, right?

00;08;50;26 – 00;08;51;16
CODY
This is it.

00;08;51;18 – 00;08;58;18
ANDY
This looks I don’t know what you want to say other than like it’s just strong like bull. That’s a weekly, right. I mean, look at how much it just.

00;08;58;20 – 00;09;01;00
CODY
They will pick of the monthly real quick while you’re.

00;09;01;03 – 00;09;01;24
ANDY
Looking ski.

00;09;02;00 – 00;09;04;14
CODY
Or gander and you’re like that one I think.

00;09;04;16 – 00;09;06;19
ANDY
They all look at that it looks phenomenal.

00;09;06;25 – 00;09;07;23
CODY
It does.

00;09;07;25 – 00;09;23;19
ANDY
So I mean Christmas comes early here for this one, huh? Yeah. I don’t know. This is I mean, this is something to be really mindful of. I mean, we talk about like, you know, wealth effect, people’s ability to spend money like it’s discretionary income. And I know dairy is I think you can call it more of a staple or not.

00;09;23;22 – 00;09;49;16
ANDY
But that said it looks good. I it’s it’s tough to argue this chart right here. We could take a quick look to it. So this is the spill the S&P right this thing, obviously, it’s going to be a little bit similar, but it hasn’t on this monthly broken out into new highs just yet. But it sure close I mean, it retraced this attempt to break down pretty handily and then opened higher.

00;09;49;18 – 00;09;59;08
ANDY
So we talk about like the close and then the next subsequent open and you know, price action after the fact. Right. It’s a clear confirmation of this, you know, rejection. You’re right. And so it’s. That looks good, too.

00;09;59;12 – 00;10;14;01
CODY
Yeah, I guess that’s a hard thing. And tell me if I’m wrong. But when we get into new highs, like we just looked at, you know, it’s hard to, I guess, call a date top in a market like that, right. Or give a direction saying, hey, this is we’re going to go test this area and come back down.

00;10;14;03 – 00;10;15;14
CODY
I’m sure there is.

00;10;15;16 – 00;10;38;12
ANDY
I guess it’s just said it’s tough to argue when you have one, two, three in a row like this, it gets completely wiped out and then you have subsequent open in the now, you know, trading to new highs, new highs here. I think this is something we have to be pretty respectful of. And, you know, there was a Fed meeting talking, I think it was the other day talking about the potential for rate cuts in 2024.

00;10;38;14 – 00;11;00;24
ANDY
That’s obviously a long time away. We’ll see. But I think we want to make sure we brought this one up is because, you know, the wealth effect obviously is something that, you know, it’s a it’s a larger macroeconomic thing, but it certainly plays its role in, you know, dairy fundamentals, particularly the demand side. So I guess, you know, all things said jam milk not looking so hot.

00;11;00;27 – 00;11;05;12
ANDY
Neither is heating oil, which isn’t a bad thing. It looks like your stocks can be pretty good.

00;11;05;14 – 00;11;07;17
CODY
More money for Christmas presents for everyone to have more.

00;11;07;17 – 00;11;10;08
ANDY
Money for Christmas presents. What do you get me for Christmas, by the way?

00;11;10;11 – 00;11;11;25
CODY
It’s a surprise. I can tell you.

00;11;11;28 – 00;11;13;13
ANDY
It’s a surprise. Surprise?

00;11;13;16 – 00;11;18;29
CODY
For me. Their Christmas is, what, two weeks away? You know, I don’t.

00;11;19;01 – 00;11;24;25
ANDY
Think I had to think about that, by the way. Like, Oh, hang on. Let me let me think. Do I have a tree in my house? Let me take a peek.

00;11;24;25 – 00;11;29;26
CODY
No. Do you you have Christmas lights up. You get to the holiday spirit. Are you a festive human?

00;11;29;29 – 00;11;53;22
ANDY
Oh, yes. Right after once, once Thanksgiving, like I’m very respectful of Thanksgiving. I don’t think Thanksgiving gets enough credit. I guess everybody’s fired up about Halloween. I realized, Oliver, look at me wrong. But then you have this, like, interim period for you, except when holiday lights up and you see people that are, like, anxiously like putting the Christmas lights up like November one, I’m like, what about Thanksgiving?

00;11;53;25 – 00;11;57;06
ANDY
So they have Thanksgiving, though. They want to. Well, I think that’s all she wrote.

00;11;57;13 – 00;12;16;09
CODY
I mean, I think that’s going to do it for Andy. And we appreciate you guys tuning in to yet another episode of the fantastic tech talk. We had nobody call in right in. Want to look at anything? If anyone does for next week, please get a hold of Andy or I. But until then, everyone have a fantastic weekend, even better week and we’ll see you mid-next week actually.

00;12;16;12 – 00;12;18;10
ANDY
Mid next week. We’ll see him in next week, right, For the.

00;12;18;10 – 00;12;19;10
CODY
Holidays, little earlier.

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