Friday February 29th   

General Comment -  Just as we mentioned last night, corn paused today with beans sharply higher and wheat sharply lower.  Next week is going to be fast a furious so get ready.

Corn – We were looking for a break in corn more than 14 cent off its high in order to setup a top but that didn't happen.  We could still work higher here early next week as beans continue to charge ahead.  Be sure to read our comments for soybeans.

Wheat – Down sharply again today losing 98 cents in the March and 57 in July.  As we have been saying, this market has topped.  Minneapolis Wheat is now $7 dollars off its high.  A rally should be sold here and I would expect a sharp rally at some point. 

Beans – Still no sign of a top and China is buying here like there were no more beans in the world.  While that is not really the problem the fact is China has so many dollars on its hands, it like paying play money for beans and they are not slowing down at this price and I doubt they slow down at $20.00 (if it gets there).  China will buy until they feel comfortable with supply and that could be a while longer.  Also, the focus of the market will shift from China buying to acres planted and soon.  How many acres of beans are there going to be?  I'm not ready to say but I expect a larger increase than the USDA thinks right now.  $17.00 beans verses $6.00 corn should be no contest and that is what we are approaching as this market continues its rally.   

Rice – Limit up today in old crop as March exploded higher by 70 cents bid.  This rally occurred in the last 30 minutes and all of a sudden, this market now looks like we could squeeze the March.  I'm not sure I'm ready to say that as today's action could have been short covering.  If this is a squeeze, heaven help us next week in rice.  We could really move sharply higher until the squeeze ends and then the market will break like nothing you have ever seen.  These type of moves do not work well except for the luckiest people.  You must follow this closely.  I've done this enough to know, I'm out.  I will not trade here again until the market finishes this level of volatility. 

Cotton- Up 271 points and still trucking...no changes, I still see it higher. 

Natural Gas – Down a little as the market pauses.  I can see a break here near term but it sure hasn't shown itself yet.  Longer term, I am bullish after a break. 

Cattle – Down 37 and still sideways.

Thursday February 28th   

General Comment -  Whatever you do, do not look back at any sales you just made.  One of the hardest things for us as marketers is to sell a small portion of the crop and then hope the market goes up.  But tonight stop and think about it.  When we sell anything but still have part of a crop left to sell, we want the market to go higher.  Do not think for one minute we will sell the top on everything...we won't.  We need to have a market plan that is orderly and built on solid information.  Right now we see risk in the market but not enough to sell more than 33% of the corn crop in 2008 and we have sold no soybeans and no rice.  At the same time, the 2007 crop had risen to prices unheard of and it was time to finish sales there.  So tonight, I am very happy and by gosh I WANT THE MARKET TO GO ON UP...I have a bunch of corn to sell and I am glad to sell it higher. 

Corn – Please read last night one more time... 

The action in the corn today (Up 18) is not that bullish...now if it happens tomorrow, THAT would be bullish.  As I said last night we could get a bounce off the low level and indeed we did.  Right now we are testing the highs and if the market reverses tomorrow, it is going to a tough weekend.  The technical action looks like a possible double top with a bull trap setup.  As the market tops, it could take up to 8 days for his wounded thing to die or prove that the top is not valid and that we are still going higher.  The average range for corn on a daily basis is back to 14.2 cents which is the near highest level we have ever seen of 14.9 cents.  This means off favors as much as another 14 cent range between the high and low tomorrow.  I think we could rally early and then sell off late but anything remains possible.  We have no intentions of selling anything else.

Now for you who waited on the $5.27 level, tomorrow you can just relax.  Even limit down will not get to the new support line of $5.33 in the May.  If you are aggressive, watch the market closely and if we trade higher but are going to close more that 14 cents off the high at the close tomorrow afternoon...sell that close. 

Wheat – Down 90 today in July as the wheat gives up.  This is the top guys and it will only get worse....you must sell any rallies here and frankly if you didn't sell as we suggested, I see no reason to not go ahead and do it right now.  Another $2.00 down is likely.  Corn farmers beware.  Yes, we can see a bounce here as the volatility is huge,  A 70 cent bounce could happen any time.  On such a run, we would be sellers. 

Beans – As I said last night, this market has no sign of a top and is the best one going.  Until I see something I can put my hands around, there is no reason to sell it.  $22.00 beans were talked about last weekend but that would require a yield under 42 bushels per acre.  The fat is, this market is leaving the world of normalcy because, we don't have an acre even planted.  So if the market stays here, that leaves us with a $15.00 to $22.00 move if we have problems???  Not a chance.  That number is way to low if our base is $15.00 for the start of a weather market.  Weather markets with this type of carryover...DOUBLE the base price. 

The bottom-line is this, if $22.00 to even $24.00 is the ration price, and that is just an assumption by some high flying  market analysts, then the base should be $11.00 to $12.00 not $15.00.  This sets up a break into the time just before planting.  That is one of many reasons why some, including me believe we need a break before planting to see just where the NEW floor for beans is going to be given the current carryover. So far no break so we will keep looking for a reason to sell it.    

Rice – Up 28 today as the market keeps on trucking.  Iraq is back to buy rice and that of course is helping push the market higher.  Panic in the streets is next as it look like we going to run completely out of the grain.  I think we are probing for a top but again, there is no sign of one.  We do not want to sell any new crop and if you are in Texas, you should have sold your old crop yesterday.  For you guys in the delta, we will give you some guidance based on futures when we can but at this point, do not be selling yet. You are in a whole different situation.  

Cotton- Well was that it...Up 147 points today after the break which lasted one whole day.  We will give it more room because tops of this nature are back and forth affairs.  Sometimes its best not to even watch the market when it is this crazy.  Range is 153 points on the average so that indicates things are really heating up. 

Natural Gas – SO much for taking off my long UNG position.  Crude exploded today and with it went the whole energy complex.  I am bullish gas but think a break is in order.  I could be wrong!!!  Lets see what happens when the weather starts to modify a bit. 

Cattle – Up 22 and still quietly sideways.

Wednesday February 27th   

General Comment -  Today was one of those days where you just have to make up your mind and recognize the change in the wind.  We sold every grain of 2007 left in the bins or on futures as but backs.  What a relief.  Was it the wrong decision???  Well time will tell but my job is to tell you when there is a level of risk that is too high and that action should be taken.  The risk levels of the last few days has accelerated and the action today in wheat confirmed in my mind that a major top is occurring there. 

Do we sell everything including future years?  I was asked that question today and the answer is ...Nope.   I am not ready to go that far as things are changed forever but I don't know to what degree.  Remember, there has been a complete paradigm shift and the days of $2.00 corn and $4.00 wheat are LONG GONE!!!   This shift is so major, many people haven't let it hit them yet.  When you see that the world demand is growing so fast we can't produce enough to fill the acceleration, then you understand that there is a new floor for these commodities and to be honest, I don't know where that floor is.  I do however, know where it is not and it is not at the current loan levels.  This is not your fathers market and you cannot market like it was.  You must change your ideas about the market and what has occurred.  IT WILL NEVER BE THE SAME. 

Corn – We sold all remaining 2007 corn today and recommend you be 20 to 25% and if very aggressive, I don't mind you being 33% sold here.  What can happen is plainly stated here in our comments.  The market may break 50 to 70 cents but once we see that kind of a break, it will enter buying mode for a wild weather market.  Some of you may be waiting for the confirmation at $5.27 in May and that is OK.  We could bounce over the next few days off this level but again, we said this morning a rally to the $5.35 to $5.40 level was a good place to sell and that is what we did.  Yes I could be wrong, but where is the risk near term.  The massive reversal in wheat after two days of extreme volume says we are topping there.  It may take 5 to 8 days but this market is looking pretty bad here and a move under $5.27 will accelerate the market lower.  Soybeans can hold corn up as they don't look that bad as of tonight. 

Be sure you don't take your eye off the ball.  I do not think this is the high.  What I think is that there is come buying in corn that needs to be balanced if the wheat has topped and wheat looks like it has done that.  Even so, selling a little here is not bad when you are locking in $5.50 corn. 

Wheat – We pulled the trigger today on all old crop wheat and even some new crop.  I'll tell you we were lucky today because we waited, just as commented in the morning update,  we waited for a rally to sell and the market gave us a $2.00 rally off the lows to sell and we did.  I sold July at limit up today but got filled 15 cents off that level.  WHAT A MARKET.  I remember 1979 or 1980 cotton and how it topped.  It was up limit then down limit, then up limit then down limit, then up limit than closed limit down...all in the same day!!!  Wheat looked a little like that today and when we saw the rally to limit up in just about 2 minutes, we took a shot at it and it paid off.  Hopefully if you were selling today you caught that bounce too.  Tonight we are down 32 in July which doesn't mean it won't be up 32 by 6 AM in the morning.  Even so, the technical action is bearish and we see major risk here for the old crop and for some new crop. 

If you want to be more aggressive and sell over 33% for 2008, go for it.  There is nothing wrong given the current picture, in taking a lot of the risk out of the field.  I am 70% sold tonight with cash and futures so you can see I have taken profit and am not going to get too greedy.  Can it rally back 2 to 4 dollars?  Of course it can do what it wants but that is not the question, the question is, at this time is there extreme risk in being long a lot of wheat???  Answer is yes!!  We will see how we fair but again, over the next few days I will look like the smartest guy in the world only to look like the stupidest one the very next day.  Volatility is going to continue but it looks to me like the market is changing hands here and the strong hands are selling to weaker hands.  That is not positive.  

Beans – This is still the best market going.  Down 21 at one time, July finished down 8 and is down 3 in the night trade at 10:00 PM.  This market is not showing signs of a top yet.  Can it separate from corn and run higher while corn sits or starts lower???  You bet ya but my idea is a top is near here too.  I look for another move higher in beans unless we move below $14.54.  On the next push higher, I think the beans will finally come to a top before planting.  Once the report is out on March 31st, this market will be hard pressed to keep going higher as the news will be in a and a buy the rumor sell the fact will be in play. 

Rice – Up 4 with no sign of a top here either.  We recommended selling cash corn at $15.50 today ($9.00 premium) and we moved all of ours at that level.  While I think it could go higher, here in Texas, we probably moved 75% of all rice remaining in the state today at that level.  I don't want to be last guy holding rice in Texas, because, you will be the guy holding rice.  Technically, I think this market can still go higher but it is pushing the envelops with wheat.  If wheat gives up there are a few funds long rice based on wheat.  The market could get sloppy and weak but I must admit, there is no compelling reason to sell short, rice futures.  For now, I am short the $17.60 calls for a little downside protection and if we trade up to that level I will enter a covered call position. 

Cotton- As I said last night, a correction was possible and today cotton gave back 198 points.  We will buy this break but lets give it some room and some time to see just how big of a break we can get. 

Natural Gas – I took off all long natural gas positions yesterday as reported last night.  For me, there is a good chance of some back and forth near term with maybe a 10 to 15% pull back but I doubt we get gas much under $8.00 if at all before the weather market of 2008.  We will let it do what its going to do here near term and look for a break to buy back in using the ETF of UNG.

Cattle – Down 100 and as expected, still sideways.  Longer term this one is the sleeper but for now, let it sleep. 

Tuesday February 26th   - Long one tonight!!!!

Corn – After almost hitting limit down, corn struggled with unchanged at the end of the day but drifted lower in the last 15 minutes to finish down 2.  We started lower after Minneapolis Wheat came off limit over night.  I should add by the end of the day it was back limit bid as was all old crop wheat contracts everywhere.  As far as corn goes, the correction of today from yesterday's high was 25 cents and it took very little time to accomplish it.  Are we at the top of this move???  It is time to stop and look at the big picture.

LET'S TALK:  Remember that tops occur with extreme volatility, much like today and yesterday.  But tops also have a tendency to occur around a big infusion of data or an important report.  The S&D report on March 11th is the next big report until we get to the big daddy, March 31st.  So the things that will influence corn near term is going to be other commodities and how they trade along with rumors about what trade services feel corn acres are going to be.  I don't see enough data to bring about a whole sale move down in corn.  Some commented today that because corn topped last year on Feb. 26th, traders should be very careful here.  Hog wash!!!  Last year corn was looking at huge increases in acres when we hit the end of February and right now we are looking at less acres with higher demand.  Also, soybeans were $8.00 lower than they are today.  It is not the same situation at all except for one thing.  We are well into a major bull run and farmers are still trying to decide. 

Let's suppose this is a top for now.  How far can it break???  If you look back at the last break, it took about 10% out of the market in 5 days.  That was a 50 cent correction.  Eleven days later we were making new highs.  So the first thing is to know that the a top will signal more than a 50 cent correction and a good rule of thumb is a correction of 15 to 20%.  A 20% correction from here would put us back at $4.50.  It would also cause many of you to check your nitroglycerine supply.  I doubt we get that type of correction until we have a handle on the crop size and yield potential.  So that leaves us with a 10 to 15% correction.  That seems plausible.  A 50 to 75 cent correction would put the support in May corn between $4.70 and $4.90.  That would be my answer to how far can it break. 

What would signal a correction???  Today's low is now the signal for longs to jump ship and look to buy it lower.  That is $5.27 in the May and $5.37 in the December.    

If you are extremely worried that this is a top, here is a trade for you.  Consider buying the April 540 Put and selling the July 470 put paying 10 cents.  You may need to see this on paper but what it does is for 10 cents, you get to look at the market trade through March 22nd.  After that you will take the trade off no matter what.  So this is just a three week trade but if the market is topping here, you will get to take everything out of it below $5.30.  Based on the last correction, it only takes 5 days to smash the market 50 cents. 

Do I think this is the top??? Nope.  Weather and acreage concerns are too large for an early top in 2008; however, I wouldn't be surprised to see a 50 to 70 cent correction over a couple of weeks at any time.  That is why options may need to be deployed if you need protection or a security blanket to sleep with.  What a market!!! 

Wheat – Another limit up move and then the market came off 90 cents only to turn and go back limit up.  It is when it is limit down we will have a problem.  No sign of a top and options are too expensive to use at least for now.  We may have one to try in the days ahead.  This would be to sell some of the crop.  

Beans – Up 15 and 40 cents off the lows.  Beans remain the main mover and will be until we get the March 31st acreage report or as I call it, the surprise.  I think acres will be higher than anticipated and corn will be the loser, or winner depending on your side of the equation.  Weather scares here will keep this market going and going so there is no reason to do any selling just yet.  Options will be our strategy.  

Rice – Up 8 after being lower with the rest of the grains.  We are high enough now that any thing even looking like a break makes a lot of people jump.  Today, the jumped too early as the market never could get traction for a lower move.  No sign of a top here either. 

One more thing...DO NOT SELL NEW CROP RICE AT $7.50 TO ANYBODY!!!  Unless it is to me that is.  Right now I can lock in $9.00 as a floor using options so if you want to give me $1.50 a cwt, I will buy up to 200,000 cwts. on a flat contract of $7.50, paid two weeks after it's dry.  OH PLEASE, PLEASE , PLEASE....  This offer is good as long as September Rice is over $16.20.  If my banker is agreeable, I will buy up to 1,000,000 cwts.   GET THE POINT!!!

DO NOT SELL NEW CROP RICE AT $7.50 TO ANYBODY!!!   (Except me)

Cotton- We keep banging away as cotton soars on speculation of a major drop in the carryover.  We could pause in the next few days but longer term, I still remain bullish and $1.00 is in site believe it or not.  Don't sell anything yet. 

Natural Gas – Again just a little higher....I took off all UNG contracts today making a nice 20% on this seasonal move.  I will want to buy it again on a break and I'll tell you when I do it.  Remember, past performance is not a reliable indicator of future performance.  We will need good fundamental reasons to replace the contracts but longer term, I remain friendly to Gas.    

Cattle – Up 67 and looking better in its sideways move.  A hope over 96.70 send this one out of its shoot into an uptrend.  I don't give it great odds but even so, it is one to watch especially longer term. 

Monday February 25th   

General Comment -  One thing to remember as we go through this bull market.  The fundamentals will turn bearish AFTER the prices have already started down.  Whatever you do, do not get caught in the big news picture and not see what the market IS telling you.  While it is saying higher right now both fundamentally and technically, when the market turns traders will still be seeing bullish fundamentals while the market is collapsing.  You must be ready to move from the fundamentals to the technical's quickly.

Corn – Up 11 after hitting limit up earlier.  Tonight as I type this, corn is down 5 in the overnight trade after starting higher.  Wheat is limit up which is at 90 cents so that started the market higher here tonight but it isn't holding, at least not right now.  In general, nothing has changed but again, it could and it could change any day now.  In general, we will remain with a bullish bias until we should change it.  Keep your powder dry and do not be selling anything here.     

Wheat – Up limit today and tonight up another 90 cents which gives us $1.50 in two days.  Do not be selling here either. 

Beans – Up 31 cents as beans continues to try and lock in acres.  Breaks will be bought here early and some people are now talking $20.00 beans.  Weather concerns will start working in this market as well but we are a couple of months away from the 2008 weather market....it is going to be a long summer. 

Rice – Up 35 as more and more concerns about world supplies of rice surface.  Do not be selling any futures but for you in Texas, its time to see about selling the rest of your rice crop in inventory.  Look for $8.50 to $9.00 and soon.

Cotton- Very strong day today.  I see we have missed some comments here the last couple of weeks and I apologize for that.  Didn't realize it was out of the listing.  Anyway, nothing has changed for us, we have been cautioning not to sell here and that Cotton was the sleeper...well it has a wakened.  Strong day today and there is more strength ahead.  Buy breaks. 

Natural Gas – Just a little higher after trading both sides of unchanged.  The market broke pretty good today but came back to finish a touch higher.  No sell signals here either.  We will be watching it very closely the next few days because a top in the next three weeks is probable. 

Cattle – Up 92 and still sideways.  A break under $90 is possible but it should be bought.  We are not bearish cattle and in fact will tell you now, it is the next sleeper.  It is a few cycles away but cattle prices are going to rally late this year or early next.  I can hear the screams in the stores already. 

Friday February 22nd   ^- From Florida 

General Comment From Florida Convention  -  Sorry this update is late but I wanted to write after I heard from some of the speakers here in Orlando.   My trip here has been very interesting as many ideas about the markets and the economic situation in the US were presented and the bottom line is a major bull story still exists and that the corn market may be the sleeper in the grains.  Some ideas here include the possibility of only 86 million acres of corn.  That would indicate a move to over $6.50 in December with good weather.  Don't even think about how high it would go with bad weather occurring. 

The bottom-line from this is what I have been saying and thinking.  This is not a year to sell cash corn in advance using any form of Hedge to Arrive Contracts.  It is only a year to sell cash forward with a locked in basis or use options to protect the downside.  The main suggestion here is exactly what you would expect at a brokers conference.  Don't use any form of forward contracting except option strategies.  In other words, use the futures tools to hedge your hedge.  The plain truth is and you guys who know me know me well enough to know I do not push the futures onto anyone, but the plain truth is, this is the year to use futures and if you don't, you are going to leave money on the table...unless your just plain lucky. 

Corn – Down 3 as the market reacts to the USDA carryover projection from the outlook conference.  In general the market still has no sell signal and from all I hear at the brokers conference in Florida,  the market is not going to break anytime soon.  We will have a "Lets Talk" section about this when I get home but for now just know that we are right to be waiting to sell.

Wheat – Up 19 and still headed back toward resistance.  While I think a rally here could be sold there are other things to think about so hang on and lets watch this one real close.

Beans – Up 14 on lower carryover numbers.  Beans could easily go to $16.00 before this one stalls at the acres.  Near term, it looks higher.  Again, no sign of a top so no selling is recommended.

Rice – Down 10 with a reversal lower.  Could this be the top?  Could be but there is no proof of it yet and we will give it a lot of rope to hang itself.  No futures trading recommended; however, cash prices may jump soon and if hey do, $8.50 to 9.00 premiums is where you should be considering selling at this time of the year and under these condition in Texas.  Don't sell for less than $8.50 right now.

Natural Gas – My ideas on gas are unchanged.  I see it firm near term, then a dip and then higher into the summer.   A lot of talk here in Florida about the BTU conversion of crude to Nat Gas and if you go with that logic, Nat Gas is $2.00 too low.  Not sure I do because of the low number of conversions that allow some large users to use both.  In any event, Nat Gas is not too expensive and if we see a break, it will be a buying opportunity.  We are currently up about 14% on our gas buying in UNG and will hold that for now. 

Cattle – Nothing new...still sidways.

Thursday February 21^{st   -} From Florida

Corn – New crop Dec has closed in all time highs today at $5.52...incredible but the thing is, it doesn't look like is over.  March made a new high but only closed up 1 and not above the recent contract high.  All in all a very good day and for us, there remains no sign of a top and until I see something that indicates a top, we will not sell a dang thing.

Wheat – Up 13 as the market holds and bleeds off some volatility.  $10.80 is near term resistance and it could be hit in the March.  I think we have topped for now so a rally here should be sold. 

Beans – Up 13 as this market believes we are out of beans.  Maybe we are but the truth is we never will run completely out...well at least not this year.  Again, no sign of a top so no selling is recommended.

Rice – Up 45 as rice trades at $17.25 in July.  I am looking for a place to sell some new crop using options but again, there is no reason to sell until we see a reason.  Will the basis ever return to normal???  Yes but when is a better question.  We will let her rip and hope we get a chance to sell it when the top comes.

Natural Gas – The fundamentals are setting up bearish on Gas but we do not have any reason to sell it today.  Crude lost $1.73 maybe on Boon Pickens saying crude will be lower in the second quarter by $15.00.  At the same time, supplies of gasoline and crude were expected to be higher today.  This is not the place to buy that is for sure but at the same time, why sell it??  Tomorrow I may have different ideas.

Cattle – Still sideways.  Today's close is almost exactly in the middle of the range.  The economy still looks weak o me so cattle may struggle.

Dow –   Down 130 as I type this.  I am looking to start owning some ETF sectors as the Dow trades under 12,000 but for now, I m on h sidelines except for commodity ETFs.

Wednesday February 20^th  

General Comment -    Once again I am traveling so no major update tonight.  Nothing has changed in any of the markets.  Corn finished higher after being lower all day and looks like it could take the lead.  Rice tried to lower too but came back.  Again, I am watching open interest in March as it could signal some major changes coming.  The question was asked today what a squeeze would look like.  I don't expect a squeeze but we could setup for one.  The thing to watch for is the March to start gaining on the May contract.  If we see that spread narrow by 10 cents or so, it would signal the possible stat of a squeeze in March.  That's the first sign.

Nothing else changed in direction.  I call today a noisy day as nothing new occurred anywhere.  We will have a full update tomorrow night.

Tuesday February 19^th 

Corn – Up 5 with a little lower range than the average over the last three weeks.  Corn is being pushed the other grains and I see little chance for a major break until wheat and beans break.  New contract highs remain the target here and we'll see if that can happen this week.  $4.90 remain support for now. 

Wheat – Up 9 1/2 with a quieter day.  We have bounced back and now the questions is can we head into new highs???  I doubt it but I sure am not selling anything right here.  We are over $1.00 off the highs and I will do some selling on a further move back higher.

Beans – Up 25 in old and up 42 in new crop.  The battle for acres is at full speed.  No sign of a top so no selling recommended. 

Rice – Up 16 today and one has to wonder if we are not setup to squeeze March rice.  This could be very interesting but here is the main thing...under NO CIRCUMSTANCES should you be short March Rice.  We have not seen many squeezes lately and never in rice.  If it happens this time, heaven help the shorts.  

Natural Gas – Powerful day with crude soaring over $4.00 higher today.  We see it higher still but the fundamentals do not support a dramatic move right here.  Later this year, is another story.  Stay long the UNG (Exchange Traded Fund) and stay short the Puts for now.  We did buy some in today but its time to ring the register on some of that action. 

Cattle – Nothing today and nothing over the last several weeks.  Sideways it remains.

Dow –   A nice start to the week fizzled and the down finished lower by 10 points.  Looks lower still to me.   

Friday February 14^th  Man I love a fast internet....It is so good to be home...Until next Thursday!!!

Corn – Up 4 to 6 after trying to sell off earlier in the day.  Corn is holding right near its highs while beans made new highs today.  In general, it is going to be hard to break corn with beans going higher and wheat holding in here over $10.00.   As we go through this weekend we remain bullish but watching like a hawk.  We will give it room.  Lots of room. 

Wheat – Chicago closed in the middle of its range after being on both sides of unchanged.  Buying is still a major feature in the M. Wheat so going into next week, we will be looking for weakness in the Minneapolis contract to signal some profit taking or additional selling.  For now, no sign of a top anywhere.   

Beans – New highs today and that signals more upside as beans worry with acres.  One of our target systems now shows a $15.00 target for March.  It is not that accurate but it is a target.  I think $14.30 to $14.50 is more like it but the main thing is there is no sign of a top. 

Rice – Down 15 on profit taking today.  Good exports, news that the Philippines are going to import a lot more rice and news that China is in trouble on their exports has some solid demand under this one.  If we see a sharp sell off, something has changed or as the old adage goes, the shoe shine boy just bought rice.  The problem for me here is that there is so much room for this market to break before it gets to support that it is scary.   We could drop to 15.50 in March and it still be over bought!!!!   Think about that as you take positions here.  This will come to an end and GREAT will be the fall.  Now is that fall from $16.00 or $20.00.  I don't know!!!

Natural Gas – Weekend profit taking may be to blame or the forecast for warmer weather before the next cold snap but in any event the market still looks OK technically.   We are 21 cents from support so a test of the $8.60 to $8.70 level remains possible.  If over the weekend the weather completely changes, then we will have a lot to talk about.  For now, we remain long. 

Cattle – A quiet day finishes off a down week of about 130 points.  That is not bad for what is going on in all the other grains.  Numbers remain bearish in the cash side so we have some more work to do to clean up some over weight cattle.  No recommendations here but we are nit that bearish now. 

Dow –   Quiet end to volatile week.  More downside is possible but there are going to be rallies throughout and we want to own this around 12,000 if we can get it there. 

Thursday February 14^th

Corn – Up 14 1/2 as the grains shoot higher.  Given crude charge higher and no selling in any commodity complex, the market moved higher and is now set to challenge the highs.  Be patient but be ready.

Wheat – Up 41 as the market turned higher after the recent selling exhausted itself....  We are now back in that area where we find out what this market is made of.  

Beans – Up 40 and headed toward its highs as well.  I expect new highs soon but then what...if there is more buying $14.50 beans becomes a real target. 

Rice – Up 32 as this rally continues.  Demand is coming in from everywhere now and it will get more intense the next few weeks.  No sign of a top and there is no reason to sell it yet.  A tough decision is coming when the markets start showing signs of a top but for now, we don't have one so let her rip...

Natural Gas – Strong move in Natural gas today sets the stage for a test of $9.00 in the July and soon.  Resistance is at $9.05 to $9.15.  We may want some put protection in that level. 

Cattle – Testing the lows here and the action today looked good.  April cattle are range bound right here. 

Dow –   Down 175 as we gave all of yesterday's gains back up.  The trend is lower and for now that is how we would trade it.  A move back under 12,000 is where we start owning it lightly.

Wednesday February 13^th

Corn – Down 1 1/2 with only a 6 cent range.  That compares to 15 as the average over the last 20 days.  In general nothing has changed.  The current acreage forecast from USDA is at 88 million acres for 2008 which will be 4 million less than last year.  That is going to make it hard for the market to break much.  I still see the market as two sided near term but a break of over 20 cents is going to be  buying opportunity.

Wheat – Still under pressure but I think a bounce is about to happen and hat one we will be wanting to sell.  The current longs are getting out in droves but he again, what happens if there is any other production problems such as dry weather in the wheat belt.  Patience has worked so far and we will keep that as our attitude right here. 

Beans – Up 7 in a quieter session.  I will wait to see how it trades over the next few days.  Currently I just don't see a major risk in the market.

Rice – Up 28-33 cents on news China has problems with GMO and Europe wants to tighten controls.  Near term that could bring in more buying from the US by the EC but I think that is a big "could".  Still no sign of a top so still no reason to sell.  Cash in Texas is at $7.00 and $8.00 is now pretty likely and that level, I will be had pressed to hold out for much more.   Maybe $8.50??? 

Natural Gas – More consolidation.  Lets watch it here the next few days and see if we don't head back up toward the break out level.  If not, we may take some action.

Cattle – We remain sideways between 92 and 96 cents in June.  Look for the downside to be tested soon.

Dow –   Up 178 with more ideas of a shallow recession.  Sure...OK...from the same guys who were saying no recession two weeks ago.  I am still on the sidelines wanting o buy it but lower.

Tuesday February 12^th

Corn – The market finished down 6 but still over the major support level of $4.90.  I can see us taking a shot at trading below that level but this is like the ole story of a dog chasing a car.  Once it catches it, then what???   The way we are looking at it, this type of market needs a lot of room and we intend to give it just that.  For now, patience is the best approach as wheat finishes its move and the world returns to some level of normalcy in the process.

Wheat – The market shot to limit up in the M Wheat while KC wheat finished up about 5 and Chicago tanked  with new crop down 50 cents.  The chart for July Wheat looks the worst but still doesn't show a top formation yet.  SO near term, we are going to let others play the emotional game as I am not sure this is over yet.  It may be over for now...but not over for good.

Beans – We finished down 5 but again well off the lows.  We will give it even more room.

Rice – Up 2 with no sign of a top here either.  Heck, my main sell signal is 70 cents lower...that is unheard of but here it is.  We could pull back near term but even a 60 cent break is not worth trading for.  We will give it he room it needs to establish a trading range.

Natural Gas – After the breakout yesterday, the market sold off today and should consolidate around he breakout price.  I can see this either way, a near term top or a consolidating range before launching into new highs.  I will wait and look at more action in the market before doing anything different.  

Cattle – We sold off 57 cents today as the market consolidates and looks at hog weakness at the same time.  I see it sideways near term.

Dow –   Up 133 and consolidating last weeks sell off.  No sign of a low here as more recession information is needed to push it lower near term

Monday February 11^th

Corn – More volatility here as corn finishes down 6 on the day but 13 off the lows.  Wheat came off limit and KC Wheat sold off more than $1.00 in its session.  If M. Wheat comes off limit tomorrow which I think is very possible, we could see more selling in the wheat and believe it or not, that could bring in buyers in the corn market as they reverse their wheat/corn spreads.  The market held over the $4.90 level again today so it all depends on what happens there.

Wheat – Just another ole day in the wheat market.  Limit up to limit down in KC wheat.  That is a $1.20 range on the day.  M. Wheat finished up 60 cents locked limit.  Where will it end???  I don’t know but I will not be in it that’s for sure.  Chicago broke 95 cents off its high with a missive reversal down so now do we see follow through to the downside?   I have more questions than answers at this point so we will watch for a least another day.  

Beans – We finished down 10 but well off the lows.  New crop rallied 14 off the lows to finish right in the middle of the range.  Tonight we have the same ideas here as in the corn.  We will give it room.

Rice – This market finished down 14 and as of yet, we still have no sign of a major top.  By the way, the major sell signal in March is now $1.35 under the current price…we will be giving it room.

Natural Gas – We are looking pretty smart here but let’s not get too excited.  We have hit the target of $8.50 we talked about and it looks like we could run a little more.  We will remain long the UNG fund and we are short some $7.80 puts.  No changes to those positions.

Cattle – Unchanged today with the little rally of last week right up against resistance.  We would do nothing here.   

Dow –   I think we have been clear that we expect another push at the lows.  The recession concept is starting to catch on but there are still some hold outs.  More bad news ahead should quiet them and we will see the concept become reality.

Sunday February 10th-  Home at last but here I go again.  I'll be in Washington D.C. thru Thursday

General Comment – I have nothing new to say.  As I type this on Sunday night, wheat has again opened limit up but it is not holding there.  All of the wheat contracts now have a  as it now has a limit of 60 cents and Chicago is up 52  here at 10 PM.

For now we will give all the markets room.  Corn is down 10 tonight with beans down 11 and rice up 2.  We are still working under the reversal last week in corn but the $4.90 level is holding.  If corn breaks under that level, support is at $4.70 and then $4.40.  That is a 60 cent risk or 12% of the value.  Even so, we are not so sure that this upside movement in the grains is over but it could be.  We will be monitoring closely this week but as I have already said, we will be giving it room.

Thursday February 7th-  A reminder I am out of the United States this week…short updates

General Comment – Wheat again finished limit up while corn was down 1 ½ or so on the day.  Beans did not follow through to the downside after yesterday and finished up 16.  Rice sold off and I show it down 11 in the electronic.

What does it all mean???  Well if I really knew I would be on a cruise ship somewhere…oh… wait a second…. I am!!!    Ok, if I really knew I would OWN the cruise ship…on second thought, no I wouldn’t but I digress…

Here is the thing, the corn didn’t follow through to the downside with a big move in fact it closed near the high after testing the $4.90 level ($4.91 to be exact).   Beans closed 33 off their lows with a massive hook reversal up.  Wheat finished limit bid and there is no sign of a top.  In fact, the Minneapolis chart is starting to look like Gold did in 1976. 

I think the odds still favor corn closing over $5.20 but we need for it to happen in the next 8 days.  I was reading just yesterday that break out signals fail 60% of the time in the first 3 days but if the market closes back in the range of the breakout ($5.20 to $5.28) in the next 10 days, the breakout works 80% of the time. 

I am not going to try and pick a top I am going to keep my eye on wheat the market is doing.  It is hard to know right here but wheat is amazing and the rest of the grains will watch it closely.

Rice broke big today but there too didn’t close near the low.  Today’s low will now become major support but get ready for more wild days ahead and make sure you keep your head in all of this.

Wednesday February 6th-  A reminder I am out of the United States this week…short updates

General Comment – When they say “no problem man” in Jamaica they are not talking about the internet speed.  It is slow where I am today but should be faster the next few days…OK, that is what they say but if you are reading this Friday morning, you will know it is non-existent.  In any event, the speed to update is critical so I have changed to the emergency update process to make sure you get it…NOW TO THE MARKET …WOW!!!

Today was another strong day in wheat but when new crop came off limit corn collapsed from up 19 to down 7 on the day.  This is a huge spike reversal and after making new highs looks like a major bull trap.  Thursday’s trade is critical.  If we push sharply lower in corn, odds favor that top we have been so worried about.  On the other hand if we can close higher tomorrow, we may still see even higher highs but once again, the volatility is huge and the market will be crazy near term in everything.  If wheat closes limit up tomorrow, I think the corn will hold the $4.90 level which is critical and it could bounce back strong. 

Same comments for beans and wheat but remember one thing, when the wheat ends this move the downside move will be extreme and that may or may not hurt the corn and beans.  We will give all the markets room and let them trade without us for now.

Rice was strong with all the action in the grains.  No sign of a top here yet so as we have been saying, hang in there and let it rip. 

Tuesday February 5th-  A reminder I am out of the United States this week…short updates

Corn – We remain fairly certain that corn is going to make new highs in March.  The current explosion in wheat prices shows just how bad things could get with there is any production hiccup.  Buying early is cheap insurance and it has the shorts in huge trouble.  Do not be selling anything else here.

Wheat – The exact same comments as last night…Limit up in KC and Minneapolis with Chicago right behind them both again.  I see old crop making new highs here as well especially with the Minn. contract showing no signs of stopping.  No selling here.   Oh and by the way, the new highs in old crop we had written about are here.

Beans – Still going…$13.37 in the overnight trade for old crop.  Things can change in heart beat but there is no sign of a change so we will stay on the long side.

Rice – We are struggling at this level but with wheat going up at limit clips, I can’t see selling anything here just yet.  DO NOT BE SELLING CASH!!!

Natural Gas – Closing at $8.00, I still like the long side here.

Cattle – Nothing new here.  We are still sideways.   

Dow –   The Dow closed down 370 points as there is a fear of recession.  Why we fear what is already happening I’ll never know. 

Cotton – I still see this as the sleeper. Old crop is under pressure while old crop is looking for acres.  I like the long side here but prefer owning a break in December.

Monday February 4th-  A reminder I am out of the United States this week…short updates

Corn – Corn was up 10 today as March heads for its contract high of $5.20.  Read our comments from last week as nothing has changed.  The chart looks better especially with what is happening with beans.  Do not sell anything here.

Wheat – Limit up in KC and Minneapolis with Chicago right behind them both.  I see old crop making new highs here as well especially with the Minn. contract showing no signs of stopping.  No selling here.  

Beans – We finished up 40 today, closing old crop into all time highs.  Again the market is saying it needs more beans and less corn.  I have no clue where this is headed but I wouldn’t sell anything.

Rice – I show the market lower after being higher.  I’m not sure I trust the system on this one as it seems to showing a wrong price but if it’s right, rice ran into selling today.  Will the longs start to add to that selling near term or is this just a pause like all the other times?  We will have to wait and see.

Natural Gas – We closed up 10 and looking at support.  I still own the UNG fund.  Look for higher into March.

Cattle – Nothing new here.  We are still sideways.   

Dow –   Is down 90 as I write this.  Back and forth action will continue.

Cotton – Nothing new for today.

Friday February 1st-  

General Comments -  –  I am not going to have a lengthy comment over this week as I travel but a quick note to say nothing has changed.  The corn action of Friday is worrisome and the chart still looks horrible.  The chart is indicating that the acres are not shifting back to beans.  I think it is too early to say that but will be surprised if more beans are not planted as farmers return to a normal rotation.  In any event, the market is not telling us that.  Watch it next week.  All other comments below are still good so read Thursday's comments.  

Thursday January 31st-  

Corn –  Corn reversed higher off of support near $4.90 and pushed back up to take aim at resistance which is at $5.20.  I have said all I can say here in the comments of the last several days and there is nothing to add.  I still see the market higher longer term but it could stay strong right into the March 31st report. 

Wheat –  Up 8 with MW limit up again.  I still see the volatility to continue but there is no sign of a top in Minneapolis and I doubt we can break KC or Chicago wheat until there is a top in the soft contract. 

Beans – Steady on the day but 14 off the low and right on the high.  This is a pointer day and it points higher. 

Rice – New highs are now here and we should run through $15.00 easily.  No sign of a top so let her rip...

Natural Gas – Up 2 with the cold factored in.  I still like it higher into late February. 

Cattle – Down 17 but we are not going anywhere right now.  Longer term, we think the numbers are going to be on the bull side but near term the setup remains bearish and we could dip a little or go sideways.

Dow – Up 207 after an early 180 point loss.  This has the bulls all excited but we think this rally should be sold and there is more bad news ahead.  For now, I won't sell it but its getting there. 

Cotton – Down 76.  Read comments from last night. 

Gold - Up a buck.  I like this one but want to own it lower.