- Seasonals work most of the time. Respect them.
- Put prices into four zones to evaluate price. Use fourteen-year charts to estimate zones. (Zone 1 is the top 25%; Zone 4 is the bottom 25%.)
- Forget market comments—except to know why prices did what they did yesterday. What prices did yesterday means nothing for what they will do tomorrow. (This is especially true for fundamentals.)
- When all your neighbors are bullish, sell. (Zone 1)
- When all your neighbors are bearish, buy. (Zone 4)
- Buy at harvest.
- Sell two-thirds of your old crop three months after harvest.
- Sell one-third of your new crop four to five months before harvest.
- Never add to a losing position.
- Never trade against momentum (the trend is your friend!).
- Government reports cannot predict future grain price direction beyond two hours. Reports do not produce or use grain.
- Proverbs 11, verse 26: “People curse the man who hoards grain, but blessing crowns him who is willing to sell.”
- Don’t be forced to sell for cash flow. Plan to sell at good prices for cash flow.
- The longer the market trends one way, the more likely it is that, when the momentum (trend) clearly reverses, the move will be strong and long.
- Once a trend starts and momentum gathers steam, it takes extraordinary circumstances to reverse it.
- You do not make money by predicting where markets will go. Instead, you profit by responding to opportunities markets present.
- Markets do not care what anyone predicts. The markets are going to go whenever and wherever they are supposed to go—even if the majority does not “think” they should. There is only one entity in this business which is always correct—the market.
- Strive to find opportunities with a high probability of success and a reasonable risk for potential.
NOTE: The above are opinions of Progressive Ag and are not supported by specific research. The intent is to help you market cash grain more effectively, as the rules are intended for cash sales decisions. The underlying basis is not scientific law. As always, future trading implies risk, and there are no guarantees that using these rules will produce profits.