A Trade Idea
The gloom hanging over the grain and oilseed markets recently has been pervasive.
The lone exception has been the canola market where the market has been establishing contract highs.
Chart 1 shows the recent contract highs for the established by the July canola futures $RS_F ( 0.0% ) .
The timing suggests short covering ahead of the first delivery day.
Chart 1: July ‘26 Canola Futures
Given the relatively large open interest, the most effective strategy for the short is to roll the short position into the November contract by buying the July and selling the Nov.
In order for the short to secure sufficient volume, the July/Nov spread should orient into a backwardation configuration from the present contango.
Trade Idea:
BUY July/Nov canola spread @ $4.50 under,
STOP @ $12.00 under
EXIT @ $15.00 over
This is OUR Trade Idea.
MAKE THE TRADE YOUR OWN.
Happy Trading
Brent
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Trent Klarenbach
306-463-8607
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Nothing written, expressed, or implied here should be considered investment advice or an admonition to buy, sell, or trade any security or financial instrument. As always, do your own due diligence.