Oat Futures—Oat futures in the July contract settled last Friday in Chicago at 2.84 a bushel while currently trading at 2.86 up 2 cents experiencing a wild trading session on May 6th as prices hit a 5 week low at 2.64 only to rally sharply over the rest of the week.
At the current time I’m sitting on the sidelines as I am looking at a possible start position in next week’s trade as the entire grain sector continues to hit yearly lows, but the oats remain strong and I think eventually they will start the following wheat to the downside.
In my opinion I think there’s a high probability that the April 29th high of 3.01 will hold so let’s see what Monday’s trade brings as hopefully the chart structure will improve therefor lowering the monetary risk as oat prices look very expensive compared to the rest of the grain market in my opinion.
Prices are trading above their 20 and 100 day moving average as the trend is higher, but the risk / reward is still in your favor so let’s keep a close eye on this market come Monday as the volatility certainly has increased substantially over the last several weeks and I think that situation will remain the same as we enter the summer months.
CHART STRUCTURE: SOLID
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