In this episode of Tech Talk, Andy and Cody discuss March feeders, weekly cheese and Feb class III.
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Future trading involves risk and is not suitable for all investors. Content provided in this for educational purposes and is not a solicitation to buy or sell commodities.
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Hello everybody. Welcome back to another episode of Tech Talk, the very first one of 2025. I am your host, Cody Koster. With me is Mr. Farm and from Chicago. But for Wheaton Wheaton, I knew it. Wheaton. Different separate them. Don’t call them same. It’s.
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I live on the air. I live on the border of Wheaton and Glen Ellyn.
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So you get offended when people say that you’re from when you live in Chicago? Yeah.
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Oh, I live in a Chicago suburb, but it’s not Chicago proper.
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Like I say, I live in Detroit, but I learned a lesson.
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Okay, fine. Whatever. You know, I used to live in Michigan. I was born in. I tell you that. Yeah, I was born, like, right there. I think it’s if you want more, like, right there.
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So. Yeah. So people would say that you’re from Detroit, but technically not Detroit.
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Flint.
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I just want to get it correct. I want to get it right.
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I appreciate you doing that. It’s a new year. New year, new you. You know you’re going to have 10,000 subscribers. You’re going to go to the moon. We’re going to get a tattoo. How is new Year’s, by the way?
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It was really good. It was a really, really chill night. Didn’t really do a lot when my neighbors went to bed at 10:00. Did not stay up for the ball drop. Oh were you?
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I ended up like falling asleep at like nine and then waking up at like 11. And so then I did actually make it to midnight, only because I was able to take like a little snack. Nap.
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There you go.
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If you will.
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Very cool.
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Good start of the year. So speaking of could start the year. We have a.
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Request. We have our first request of 2025 coming from my colleague Matt wanting to look at feeders.
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Coming in hot.
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March feeders.
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March feeders. What was this question? He had a specific question.
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Was making new highs here? Where’s the top? Where’s the support? Okay.
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It’s like right there with that. Yeah. Two shifts of the night with that question. Like where is it supportive and where is it going to top out it.
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Right. Okay. The funny thing about March Feeders is so this is a daily I also looked at that on a monthly to see if, you know, maybe there was a little bit of an indication for a top. Oh look at that. New ice.
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Yeah. All new. Oh yeah. It’s I mean, there really is no stopping that right now. It’s tough to say like. Yeah, I mean short answer is I don’t, I don’t like there’s nothing technically that would suggest that there’s this big break coming right in. And when you think about how this market see how it rejected.
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Yeah.
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Like we bang you know got in the new highs immediately close. Well within that you know that close right. Right. That that started as a sign of weakness. Nope. Not so fast. So the fact that the market like took this as a buying opportunity is just that strong high ball. Yeah. It’s just it’s tough it’s tough to argue that.
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And to your point the monthly I mean all of this break was viewed as a break to buy. Well that’s a big break too right. And you have higher low like yeah I don’t know. It’s not to say like where does this market top out at? I mean not nothing here is suggesting that we’ve got this big break coming.
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Well and I was you know, the RSI and the momentum and momentum is just kind of like you said strong like bull. The RSI just crossed over over overbought and territory. It looks like I mean just in the there okay. But as we’ve seen before that doesn’t necessarily mean that we’re going to take a pullback. And if we do when it did it before we had a day a pullback.
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And then we went higher one day.
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Yeah RSI. So it’s I mean RSI is a great way to it’s like a warning sign right. So it’s it’s it’s a relative strength index. And it’s it’s it’s it’s oscillating between two two points and you can get into overbought or oversold territory and stay there for a while. It’s when you cross back in and then start to trend lower.
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In this case lower like it’s where it would be like yeesh like that’s yeah. But the fact that we cross into overbought territory and you could stay there for we could stay there for the next 60 days.
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Yeah, that’s a good point.
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But yeah, nothing about this chart makes you want to get over like it’s it’s it has absorbed a lot of selling. It’s in a very healthy uptrend I guess the only thing you can really get maybe hang your hat on is here. You could you could argue that we’re now working on wave five.
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And.
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See, and if that’s the case, I think you could argue that this is here you would want to take. Yeah. And if you believe this was like five waves still. Right, you’d want to take, in my opinion, you take this one right the first. And I would just lay it right on top and just say like, what is this price point to 75 to 73?
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Okay. Yeah. So there’s still some room for this market to go. So yeah, I mean between this close, the fact that you couldn’t even get this like this red bar right here was the best that they could do. And that’s viewed as a buying opportunity. You have a clear, you know, five wave price action going on. The fifth wave is typically like an exhausting move.
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The market is just like all the selling. The second place I mean my gosh, look at all this selling for 22, 32, 42, 52, 60. All of that is underwater. Yeah. No open interest in the sell side is making money at this point in this contract. Yikes. So Kitty, watch, by the way, she did swap. So she got an interesting Christmas present, by the way.
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Maybe I’ll put it on next up, doc, all right. So yeah, it’s this would be my thought. Like, I think we have to see this play out, especially with how well this, this market’s handled this like attempt to break down after new highs in the last three days okay.
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So so we have a little bit of if this is a five wave we have a little bit of time baked into the upside here.
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Yeah. And I think his other question too is you know if we start to roll over like where is you know like an area of support is definitely working. Yeah. I mean, we’re we’re starting to bounce around here. Right. So that’s a roughly 253 1854 you break through that then I think it’s a you know, now you’re talking about encroaching on this uptrend.
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If that breaks then it’s like like now you have a lot of you have multiple signals of weakness. I guess it’s by then this momentum will have turned to negative here. That’s the case. And it can get dicey for sure. But right right here right now strong like well okay. All right. This next one has made it into our last episode of of 2024.
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Here we are in 2025. I didn’t touch a thing about this last one. Yeah, I didn’t touch one thing.
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And this is a roll. This is going to roll into our third chart also because I think there’s some importance on our third chart that coincides with this one too.
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Yeah. What do you think. So this was I like I said you wanted to talk about this last week and this is where you had these lines drawn. Touch anything. What what. This is weekly cheese. It’s good. I probably should identify the fact that this is weekly spreadsheets. Thank you for tweet.
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And so and you know.
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All right. What do you think.
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What do I think. So I think that we are going to complete this w I really do. But what I want to see really quick everyone to take a mental screenshot of this. Can we go to Feb cheese really fast. I talked to a class three Feb plus three.
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We sure can.
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So this is February class three made some new highs yesterday and came off of there a little bit today, but also had a little bit of support behind us. We traded over 1000 contracts towards the end of the session. Towards the end, you know, getting into the close, I have drawn online and I want you to tell me if I’m crazy or not.
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Starting down on the 3rd of December, my first wave of a five wave Elliot Theory. So I brought it up from the low of the 3rd of December to that big wick that we had on the 13th. That’s my first wave here. Yep. There’s two.
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There’s really have three here.
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So I have one. Two. I have my third go in from, that bottom at 1920. Call it 1920 on the 19.
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Okay.
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Going to call it the the wick that’s off of there on the 31st. The last day. Yep.
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Right here.
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Correct.
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Okay.
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Now this would be the fifth wave. So if you take the first leg like you just showed in feeders and you laid it over, I have got us topping. Now we’ll call the top, 2030. Call it 20.
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40. So you’re saying that these three candles were way four, correct? Right?
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Correct.
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Follow it right here.
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And we’re into wave five right now. Yep. Exactly.
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You have us going over $22.
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The what did you do?
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What did you do, Richard?
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I might I’ve got it drawn where we’re at the top of 2130.
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So you have us basically topping out right around here, right?
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Right. So today being a little bit of a pullback, but one more strong push to $21.30 $21.40, which then going back to the cheese chart breaks us into the next leg of the W. Exactly. Yeah, I see it going back to $1.90 cheese one more time as we got there yesterday. Cooled off a little bit today I think where one more push $2.90.
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We roll it over and then start on that second leg of the W.
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So where does this candle end? On a leg.
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Where do I have it ending $1.90 okay.
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So you think we’re going to. So if we settle at $1.90 that will be that will be the first red candle of this move. Correct. One, two, three, 4 or 5. It’ll be one, two, three, four, five weeks in a row with the first week of weakness correct. I’m not going to disagree with you on this piece of it.
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I do think it feels like we’re running out of gas a little bit in the cash market, and we’ve now we’ve come into this area of consolidation, right. And futures have been very reluctant. It build in any sort of material premium. If you, you know, subscribe to the idea. There should be like a 4 to 5 cent premium based on like now or PSR.
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Right. And so, you know, if you just take a midpoint, let’s call it like right around 196, which is about where, like said, she’s going to top down at 196, 197 and started. And so the question is like, who’s going to be the new buyer. You know, at like 196 197 now. And so she’s right. So I hear what you’re saying I agree with that.
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And this I think is going to this could spook the market a little bit. If we do start to run out of gas and not get any more forward momentum to the upside out of the spot market, and then I’m not going to remove it in this because I agree that this is this is a move that could prospectively come here where maybe it takes, you know, maybe we have to wait till past the Super Bowl to get significant weakness.
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But I would imagine that a lot of cheese is already bought and paid for for the Super Bowl demand too.
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I would imagine.
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You know, you’re not putting your order in the day before the game, which, by the way, who’s going to win the Super Bowl this year? Pop quiz. Who’s going to win the Super Bowl? I think the.
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Chiefs are going to win. I it’s hard to bet against Chiefs right now.
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It’s I have no idea. I never really thought so. Okay, so back to your fib chart. The only thing I don’t like about the five wave thing is that typically you’d see the second wave be equal to or greater than the first one. So it’s a question of like, where do you have this first one really starting?
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You could argue that you really should start it after the breakout, which would be like right here.
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Okay.
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But then you’re saying that this is all going to be retraced. That’s that’s tough.
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Right?
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So I mean, it’s again, it depends on where you have this market really breaking out. Was it really more like right here on this candle? If so, then this this makes a little bit more sense because then you could take this guy, lay it right on top, and you’re still north of this 2130 that you’re talking about. You’re never more like 21 house, which isn’t.
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Again, it’s not unreasonable thing to see a premium baked into a futures market heading into the pricing period, which isn’t right, you know, this week or next week. It’s the week after.
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When I, you know, I also look at today’s movement where we did not engulf all of yesterday’s candle like we did on the previous red candle. Right. We engulfed all the previous trade within the next three days were obviously higher movements from there. Today we didn’t engulf everything and we actually started making our way from lower to higher.
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Not quite.
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So I don’t see.
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Another direction change.
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Now I hear you like open interest is going to be a big deal here. I think we saw recently that commitment to trade or show managed money is gone from short to long.
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This market was my next comment.
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And you know, we’ve certainly noticed that there’s been a lot of bidding like the market’s cuts like some bits, especially towards the latter part of the day. Is there are they market on closed orders. Right. I don’t know, but it seems like there’s you know, more I guess my question is is these are those folks adding more longs.
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Is that going to see a build an open interest if an open interest is higher? We’re seeing new buying in you selling here. The new buying piece would be the interesting one right. You’re getting new buys into contract highs. Basically you don’t get a lot of new contract highs if you think the market’s going to fall apart let’s put.
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It that way. No, I personally think they are. And the reason that I say that is I was talking about this with somebody else on our team. If you look at the CFTC report that comes out usually on Fridays, we got this last one on Monday. The class three longs, net longs and net shorts. Usually they overdo it by about 2000 contracts net long and they reverse themselves and go net short 2000 contracts.
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And we’ve seen these mass of waves that have kind of engulfed the dairy industry the past year. We are right now, according to that report, plus 689 so plus 689 long contract in class three. I think you see more adding to it today to get us closer to that 2000 mark and then roll it over to.
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I believe it, I definitely believe so like I said, it’s it’s a question of like fundamentally, do you want to be long press and cheese 195 or 96 here or better or I should say higher than that, right? I mean, you’re you’re buying that with the expectation that we’re going up. We’re going to go north of like two bucks, for example, or something, right?
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Yeah, I don’t know. We’ll see. But you know, you’re starting to talk about those types of price points and you know, getting along that price, this market could break to $20 and still be in an uptrend. But that’s the thing that bothers me with the whole like. And if we are really in a fifth wave, either what what we’re saying either way is that like fifth is always the exhaustion point.
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You don’t want to be a seller of that. At the very least, if you’re long, you want to be liquidating them. I think you and I are on the same page that like, we’re starting to get to some price points where it’s going to be tough to materialize in the cash market and see, like, you know, actual sales off the exchange north of that price to justify getting more.
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So, yeah, I mean, to me, I think I don’t think we I don’t think we completely fall out of it. I do think we should eventually go and test this trend. And you start to see some support of like we seen some heavy premium get reported. If you start talking about like cheese in the one 70s and seeing that, I think it’s prevalent.
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So for us to sit back, going back to your previous chart, the cheddar, I don’t I think this is this I think this low holds for a while. This 162 I think you’re on par here with this whole point of like putting in a higher low.
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Okay.
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Just a question of when we roll over.
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Right.
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Down at this all is equal. We sit here for the rest of the week at this price or lower. This will be the first lower candle on this chart for several weeks. Over a month. I think that’s a material change.
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It’s a good point.
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So we shall see. So all right, so you’ve got us where I’m more like right here.
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So 2130.
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I think if we start to trade that price, it becomes more of like exhaustion. Like I agree, not new longs, maybe potentially people liquidating. Right. Tough to get new buying behind that kind of thing. So I.
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I agree with.
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You. That’s where my head’s at. Either way, I think you and I are on the same page. It’s a question of like, I’m a little bit skeptical and say it’s Elliott with this, just because of, like, it’s we’re kind of shopping around. I’m, I’m more of the opinion that we’re just trending higher and we can step back and then it turns into, like failing to put in a new high during that time.
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So something that we can link in is if you go and look at our software involved, you can look at the seasonality piece and see that around this time is typically when over the last five years, that February price action starts to top out.
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Over a ten year period, $21 is like the high, you know, of that market.
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Yeah. We’ll see. Oh, I mean.
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I agree I agree.
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Wild starts the year. It’s really well start the year. I mean like you could seven days. Like you could actually like bake a pie, get some forks. Like what if 2025 is your year for like silverware pies.
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It’s my year, right.
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Summer of George year of Cody. Let’s go. I proclaim this the summer I’m George. Not so. Last thing. When is it too late to say Happy New Year to people? So, like, that drop off this morning? I was talking to somebody about that school drop off this morning. It was like somebody you didn’t see them for a while.
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And I’m like, Happy New Year. I’m like, well, we’ve already been in this thing for seven days. So yeah, I,
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That’s a great question. I actually called somebody this morning. They answered and said, Happy New Year. It took me back a second. I was like, it’s a seventh. I mean, we’re almost at summer now. Can you even stop it? Right? I just I don’t know, I don’t know because they said Happy New Year. There’s a long pause because I was very I don’t know what what just happened.
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So it is the new year. But we’re past it, right?
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We’re past pretty soon. Christmas is like right around the corner.
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But something like that. After Christmas, I, you know, I said to somebody like, oh, hey, you know, Happy New Year if I don’t talk to you. And they’re like, well, Christmas was yesterday. Can’t you say Merry Christmas? And I said that that is past thanks. Got past tense. Right.
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Exactly. He’s down.
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Right. So now I’m looking forward and saying Happy Super Bowl Sunday. Happy Easter.
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Don’t forget about Easter.
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The New year is here baby. We’re in, we’re in.
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All right. Summer, Cody. Summer. George. Summer of the year Cody.
00;17;18;00 – 00;17;32;10
And the people are coming along with us. So everyone, we appreciate you tuning in. This episode was awesome. Week bangs one out, full caffeine, full of coffee. We’re ready to rock and roll. We’re just flying through the charts. Love it. If anyone has any charts they want to see for next week, just like Matt did, please let us know.
00;17;32;10 – 00;17;46;15
We’d be happy to take a look at them. Maybe agree, maybe disagree, find out when the charts get here. But with that, we appreciate you tuned in. We will see you next week on another episode of Tech Talk. And till then, have a great week and even better weekend. See you soon!
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