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Tuesday January 31st - 7:00 PM
Corn - We are holding in there
as open interest continues to go up. I still see another swing
down but today's action may be telling us it won't happen from this
level. We want to buy a break for the long-run but nothing right
now. We will hold small positions in corn and look for a chance to
buy it later when the South American crop is no longer a factor.
Bean - We want to sell this
bounce but we'll wait on a good signal.
Rice - WMP unchanged today.
Market drifted a little lower at the close so we may see another down
day tomorrow. We want to buy a break here and are hoping for a
real nice break to get more positions on. Cash prices should
remain firm but a 20 cent break is possible given the current
cash-futures spread.
Natural Gas - Nothing has
changed for me. I want to own this market but not right now.
There is a lot of talk about a lower summer price and that may be right
but specs are not going to forget last year and hurricane season which
starts in 5 months.
Cattle - Japan is looking into
US beef issues again but I think this time they won't boycott us.
We want to own cattle lower looking for the 90 cent level in April.
DOW - Fed raised rate and as I
have written here before, they will raise the rate to a minimum of 5%
which means another 1/4 point raise in March. Look for a weak day
tomorrow as the market has some other warning issues to work through.
Money managers should pocket more money in bonds near term and that may
take some of the prices out of the market.
Dollar - I remain bearish the
dollar...what else is new???? The dollar was lower today but
off its lows. Bonds were lower today indicating the market didn't
like what the Fed said on future rate changes. I can't imagine
anything else but the market figuring another 1/4 point in March.
Look for the Dollar to stabilize for awhile and then, turn lower.
Monday January 30th - 1:15 PM Early to
night due to schedule
Corn - The market started higher
with the beans but buying interest quickly faded and the market went
back to Friday's close and held there. As I type this the market
is still trading but it looks like advances are going to met with
selling. This rally should be sold as I doubt the weather in South
America can overcome the current supply of corn. We'll buy the
next leg down.
Bean - More weather concerns.
Again, its what the traders love to trade but this rally must be sold.
I wouldn't do it yet but the time is coming when we'll need to sell some
calls and look for a nice short in the bean market.
Rice - Market ran stops today
and went sharply higher. Again, I don't want this market to run
much to the upside as that will buy acres and kill chances for a major
bull move later this year.
Natural Gas - Well, I was
nervous for a good reason last week wasn't I...good grief!!! The
market moved higher today while everyone I read was calling for the
market to work lower. This bounce probably should be sold but we
need the market to prove it's still too high given the current weather
patterns. Long term we want to own a break and think we still have
time as we are 3 to 6 weeks away from the normal seasonal low.
Cattle - We called the top last
week and now we'll wait for a reason to own futures. A move into
the 88.50 to 90.00 range is probable on this break.
DOW - Nothing today and no
changes in our ideas. I just don't agree that company expenditures
are going to replace consumers so stocks are safe at this level..
If I'm wrong it won't be the first time but I really don't want to own
securities right now.
Friday January 27th - 3:30 PM
Corn - Weather concerns in South
America started us higher but then the idea of heavy corn stocks and
farmer selling sold the market off but we still finished higher.
As I said last night, when the market took out $2.20 in March, I bought
back in my short July 2.20 Puts. I am staying long my corn futures
as I don't want to try and pick a top right now. I doubt we can go
a lot higher near term and I still want to buy breaks.
Bean - Well, the idea that its
going to be hot and dry for Argentina sent this market up as the traders
love to be long beans. This is a habit they had better break or
they will be exactly that....broke. I don't like beans unless
there is Damage down south and so far, none of that.
Rice - Slow day today. We
are still long and want to own more on breaks. I see the market
higher only if we see acres 10 to 15% lower than last year. Time
will tell.
Natural Gas - Now I'm
nervous....We closed higher but off the highs and yesterday's action now
looks like a spike. I want to buy April as it nears $8.00 so for
now I'll hold with that idea.
Cattle - Just as we said last
night and the last few days, this market has setup a nice top and we
want to own it on a break. Let's see if cattle prices will pull
back in the field so we can get some utility cattle or pairs at a lower
price than they have been in a while.
DOW - Boy oh boy...GDP at 1.1%
and the Dow bulls rally the market because they think the Fed will end
its increase in rates....these guys are nuts!!!! Who out there
does not think the Fed is about finished increasing rates...HECK, I even
know they are about through. I think the Fed will still raise
rates Tuesday by a 1/4 point and then they will go up another 1/4 the
next meeting. That should be it. If this market is
waiting on the Fed to stop, its a buy the rumor sell the fact condition
and the market is about to put in a major top.
The point is this, we are going to go into a
recession!!!! Sorry, but that's my opinion and I am sticking
to it as there is little doubt in my mind we will fall too far and GDP
will go negative for a while putting us into a mild recession.
Let's hope it's only mild. Then what happens???? The fed
starts cutting rates to stimulate the economy and we start the cycle all
over again. Long-term we want to buy the DOW on a break and I
still think it's likely. This break will not be major but I do
think it could be to the 10,400 level or lower. This is all
subject to change because if we get a soft landing, it will be hard to
break the DOW back under 10,600. Bottom-line: I don't
own stocks right now and am looking for a break to start investing in
certain sectors.
Thursday January 26th - 3:30 PM
Corn - Market tried to go lower
but once again fund buying came in and lifted the market. If I can
get a bounce to $2.20 in March I will probably buy in the short July
Puts but I am going to hold on to my 20% long corn futures just because
I may be wrong and the market charges into the $2.20's to $2.30's.
Someone in Chicago is waking up to the idea we have been talking about
for three months. Buy breaks.
Bean - Not really going
anywhere. There is enough supply and looks like plenty more is
coming.
Rice - Nice break but its not
good enough to buy more. We'll see what happens tomorrow but a
nice two day correction would be really great. I'll take my shot
at some more at $8.40 in the May of $8.10 in the March.
Natural Gas - More downside
which is good. Here is our position. We think this market is
going to make a major low by the end of February. That is its
seasonal tendency and nothing has changed in that outlook. We want
to buy this break don't have a real good target for the low. $8.00
in April looks mighty good as one and its the best we have so that's
where we are going to start looking to buy the market lightly.
Cattle - Still like cattle to
work a little lower near term. We want to buy cash on a break.
DOW - The bounce today was right
to the resistance level. We'll see if the market likes earnings
near term.
Wednesday January 25th - 4:00 PM
Corn - Market continues to work
higher. The small spec is short and he may be feeling some
pressure but I doubt its very much. Open interest is down almost
20% from Tuesday the 17th's close.
PB
is 59% tonight which is really on the break out point. I'll give
it to 63% right now. Bottom line is this, I don't think this is
the time to buy. We need a little more time in this range and my
guess is tomorrow we will see lower price action. I want to sell
more $2.20 July puts on a break here. Wheat will help support corn
and it looks like we may have started an uptrend.
Bean - Ugly day as beans just
can't find any traction to move higher. Look for the market to
work lower.
Rice - We remain right against
the resistance point which seems to indicates we will poke through into
new highs. Nothing would surprise me in rice but the prospects of
major acreage cuts in rice is not going to allow the market to fall very
far.
Natural Gas - Same comments as
last night....A close is needed over $9.50
in April to setup a buy signal. We are hoping another wave down
can occur so we can buy it. Selling $7.00 July puts is not a bad
idea on another leg down.
Cattle - Read last nights
comments....today's action didn't tell us a heck of a lot but the close
was the second one below the nine week moving average. That hasn't
happened since last August. I think a correction here would be
healthy and should be bought. The break could be $3 to $5 near
term. The report last Friday is in the market here so a break down
now would signal more cattle movement to market for the fats.
DOW - We sold the market today
but then covered when it failed to go lower late in the day. The
market then rallied nicely in the futures into its close. We'll
see what tomorrow holds but the housing data is bearish and indicates a
slower economy. Well DAH!!! We have been pointing out
that the yield curve is indicating a much slower economic picture ahead
and the GDP numbers this week will be interesting. The only good
thing for the DOW is energy prices still going lower but I doubt this is
a major trend setting in. I look for another 3 to $5 down in crude
and I look for Natural Gas to stay under pressure into mid or late
February. I HOPE I HAVE THAT LONG!!!!
Dollar - The market has not
filled the gap but it may in the next couple of days. If we sell
off from here, the market has a measuring gap and indicates a much lower
move for the green back. With the interest rates moving to new
highs today, that could help bring in some more foreign interest on the
dollar but it will be short lived as longer term the dollar is going to
work lower.
Tuesday January 24th - 4:00 PM
Corn - Well, it might have
gotten away from us for the time being.
PB
went to 53% but remember, sideways markets always fail on sell signals
(just happened) and then fail on buy signals. That is the
technical definition of a sideways market. We are still long term
bullish and are long out right corn with short puts as well. We
are not going to chase the market this early but we sure the heck are
not going to exit any of our longs right now either.
Bean - Remember our ratio
spread....long 3 corn and short 1 bean contract. We took profits
on it and never got the position re-established. Today would have
been really nice in that spread. Anyway, we don't like beans as we
see bigger acres and a fair Brazilian crop.
Rice - WMP unchanged....We
remain near contract highs. We may take them out near term as cash
markets remain firm and getting firmer. I still see $2.50 by
Mid-April. We will buy futures on a break.
Natural Gas - We remain in a
down trend even with the rally today. A close is needed over $9.50
in April to setup a buy signal. We are hoping another wave down
can occur so we can buy it. Selling $7.00 July puts is not a bad
idea on another leg down.
Cattle - MAJOR SELL SIGNAL
TODAY!!!! Today's close sets the April chart negative and tomorrow
becomes important as a confirmer of price movement. While we want
to own cattle in the field, we would love to see a break here to allow
us to own more at a lower price. We will see if this materializes
tomorrow and this market must be watched very closely now. The
risk on the break is $3.00 short term and $10.00 longer term.
DOW - Two days in a row higher
and we have rallied a whole 50 points. Looks like the buying is
not in the market right now. I see lower prices ahead for the Dow
and other stocks as earning continue to come in light on revenue while
meeting profit numbers. Keep you eyes on total revenue because if
the next few days these numbers remain light, selling is going to
increase.
Dollar - Nothing new. We
would not be long the dollar and want to sell rallies. 84 is the
downside target if we don't bounce the next three days.
Monday January 23rd - 7:00 PM
Corn - Nice rally today but it
it hasn't turned any corners yet. We continue to want to buy July
corn at $2.20 on this break. We have sold some 2.20 puts getting
ready as there is little risk in shorting 11 cent $2.20 puts. Corm
at $2.09 in July isn't going to happen.
PB
tonight is at 43% so we will remain patient. Longer term, we are
bullish.
Bean - Nothing new. We do
not want to be long this market
Rice - Against contract highs
today. I want to buy a break and I am hoping we don't rally too
soon which would buy more rice acres. We need about a 15% cut in
acres this next year to put rice on a profitable footing again.
Natural Gas - $8.42 is support
in April and then $7.60. We may test this window a few times but
we are turning bullish over the next few weeks as history says this is
the time to look at buying, not selling.
PB
is 36% and the forecast remains warm so there is no reason to buy yet.
Cattle - Nothing new here.
We like the market to hold this level for awhile. We are not real
bullish nor do we think it break much from here. Own the cash if
you can.
DOW - Another day of accepting
the value. I listened to the analysts today who said this was a
good day since we didn't sell off. I'm not so sure. We want
to buy a break here but still think there is more on the downside.
Could be wrong but we'll wait and see how we trade the next few days.
Earnings are just not that rosy right now and I think 1st quarter will
be more of the same.
Dollar - I don't talk much about
this one as I have been bearish the whole year while the market rallied.
I am a long term trader of the dollar thinking out 4 to 6 months and I
am bearish here long term and short term. Do not be long here.
PB
tonight is 27% so a bounce is coming. If you're long, here will be
your chance to to exit any long exposure to the dollar.
Sunday January 22nd - 10:30 PM
Corn - Markets are up a little
tonight but we may still see more pressure. No change in our opinion.
We will buy this break. We are hoping for July at $2.20.
Bean - Nothing new. We do
not want to be long this market
Rice - Last week the market gave
us a break and we bought it. The LDP is headed to zero. I
see the market moving slowly higher but not soon enough to buy hat many
acres. Not with Natural Gas bottoming soon.
Natural Gas - We think the
market is getting close to a low. It may take another 4 weeks but
we see a major low coming even with the higher temps. We want to
buy this break.
Cattle - No change...stay long
in the field.
DOW - If you read my comments on
Wednesday, I basically setup the idea that Thursday was going to be a
key day and it was. We didn't go sharply higher which indicated an
acceptance of a lower value and then came Friday. The bull trap is
in place and now we'll see how far we can break.
Wednesday January 18th - 5:30 PM
Corn - No change in our opinion.
We will buy this break. We are hoping for July at $2.20.
Bean - Nothing new. We do
not want to be long this market
Rice - WMP up 22 cents yesterday
but the market sold off today with funds selling in light of the day on
Wall Street. These are not the normal fund traders. We see
the fundamentals as bullish longer term. In the next 8 weeks, we
want to get to 50% long so we may use this break as our opportunity.
Natural Gas - As weather
continues to be very warm, Gas traders are preparing for more product in
inventory tomorrow. Well not more, just more not as big of decline
as is normal this time of year. We'll buy this break and soon..
Cattle - No change...stay long
in the field.
DOW - Bull trap??? Still
don't know but my guess is tomorrow will tell. If we don't shoot
sharply higher tomorrow then there may be more to the Japan situation
than we think there is. Frankly, I expect a strong day tomorrow as
Japan pushes too low on the little but of news we heard.
Tuesday January 17th - 12:30 PM Early due
to travel plans
Note--- On my way
to Kansas so updates will be later in the day (except today) but I
should have them done each day.
Corn - Lower today on technical
selling. Little else in the way of news other than wheat being
lower and corn not looking at anything else but fundamentals for other
crops. We want to buy this break so get ready.
Bean - Nothing new. We
think beans are a dog. We did exit all positions on the ratio
spread and we may put it back on later.
Rice - Nothing new here either.
Market may pause in the days ahead as Asia goes through their New Year
period. I still see the market working higher but over the long
term. We will buy breaks.
Natural Gas - A bounce today and
the season lows dead ahead will keep us looking for a way to get long
here. I will be selling puts first and then looking at call
spreads before futures.
Cattle - Back up today. We
like owning cash cattle right now. Futures may struggle but should
hold their values for a while.
DOW - Bull trap??? Not
willing to say that right now but a bull trap in the Dow would be a
strong indicator if we take out the recent low of 10,680. Watch
this one closely.
Saturday January 14th -
Note--- We will
catch up on the past week in this update as I was unable to get online
while in Colorado (cell phone didn't work either).
Corn - The USDA report was
deemed bearish but couldn't hold the selling pressure past the first few
hours last Thursday. As we head into the planting season, the
planted acres for corn is going to be lower and could be as much as 4
million acres lower. We still see any big break as a buying
opportunity. For the week we were down only 3/4's of a cent with
all the bearish data. Starts to make you wonder doesn't it.
Bean - The report on Thursday
pointed out what we have been saying for sometime. Corn is too low
compared to beans and something has to give. The report this week
sent the beans lower while corn held its level when all was said and
done. Remember the 3-1 ratio spread we recommended Dec. 28th?
That now has a 19 cent profit in it and we'll watch it Tuesday because
we would like to take off some profit oh half of those positions.
Even so, we'll give some of the profit back before we take the whole
position off. Patience is a must on this trade.
Rice - The USDA report may have
been thought of as slightly bearish but overall it was a nothing report.
The USDA shows exports up 11 million cwt but we are currently ahead by
almost 15 million cwt. If exports keep going the USDA will be
forced to improve their total. Acres are headed lower and we
expect more upward pressure on prices long term. Buy breaks.
Natural Gas - This remains a big
story as the warm weather has the bulls running for cover.
Technically I can see June at $8.25 to $8.00 before this leg ends;
however, the warmer weather must remain for this to happen. We
want to buy this break but will give it room.
Cattle - We see cattle sideways
for a while. The demand continues to look strong.
DOW - We got our move over
11,000 and now we are back below that level. The break in Natural
Gas and the acceptance of gasoline prices may keep this higher move
going as earnings hold and the expansion continues. If we see
heating prices start to reverse, then we may see the break in the
security market we have been looking for. One thing has not
changed, we want to buy a big break in the Dow.
Friday January 6th - 3 PM
Note--- I
will be skiing in Colorado next week and I'm not sure of my ability to
update this page or watch the market for that matter. I am going
on the trip long cash corn, rice futures, and out of everything else.
I'll update this page IF and WHEN I can. If I haven't done it by
Wednesday night, you'll know I can't update it from where I am.
Corn - Market is still in a
formation to go higher but over the next three months I expect a test of
the support line which is at $2.06 today. Look for the market to
keep working around its current levels at we see what demand there is.
Next Thursday's report will be the focus for the next three days.
I expect the market not to move higher until those numbers are out.
By the way, as of last Tuesday, the funds have flipped over and are now
long 27,000 contracts while the small specs are short 57,000 contracts.
Commercials are long a net 30,000 contracts. That is interesting
and supports our ideas to buy breaks.
Bean - Follow through to the
down side today as longer term weather forecasts are for rainfall in the
driest areas of Argentina. Look for the weather market to continue
over the next two weeks. The USDA report this next week will be
bearish more than likely so expect that.
Rice - Highest close we have
seen. As I have said, I'm not selling and want to buy breaks.
Natural Gas - Below $10.00 is
probably a buy but I can't do it as I will be out all next week and
don't want to worry about anything in the market.
Cattle - No change in comments
here...we like the cash market and want to stay with our ideas to buy
more cattle when prices are good.
DOW - We still want to sell
rallies but this has gone farther than we expected. No sell
signals so I will leave with no positions on. We could break over
the 11,000 mark still but I do think this rally should be sold at some
point.
GOLD - We remain friendly
and want to buy breaks. That would be under $520.00 as of today.
Thursday January 5th - UPDATED LATE THURSDAY
NIGHT
Corn - Correction today of over
bought conditions. If the funds aren't buying, this market will
drift back to test support. We want to buy a big break.
Bean - Correcting overbought
conditions today. Let's see what happen tomorrow.
Rice - No change...buy breaks.
General Comments - Read last
night on the rest...no changes.
Wednesday January 4th - 4 PM
Corn - No change in our opinion.
We are in that time when the South American crop can get hurt and the
market is already poised to move higher. If we get a run to $2.25
in March we will probably start a scale up selling program so get ready.
Today's action was positive for tomorrow early.
Bean - Weather market in Brazil?
We'll see. On a rally we will scale into a short position.
Wait until the see how many acres of beans are going to get planted on
2006.
Rice - Same as yesterday....Nothing new here as we
remain a little over bought and could consolidate for a couple more
weeks. Longer term, we like the market and will buy breaks.
It is going to be hard for this one to break very far but it is known
for making a "stupid move" before going in its primary direction.
Natural Gas - Warm weather
continues and this market keeps unwinding longs.
Cattle - No change in comments
here...
DOW - We will sell rallies and
buy big breaks. We remain a little bearish here hoping for a break
to the 10,500 level or even lower.
GOLD - We remain friendly
and want to buy breaks.
Tuesday January 3rd - 1:15PM
Corn - We covered all shorts on
the open today as the market was set to respond to dry weather in South
America. Last Friday was not an aberration as I thought and
today's follow through sets corn up to possible shoot for the $2.30 gap
in March futures. We are a little overbought tonight so don't be
surprised for some give and take near term. What a gift if we can
get to $2.30. Long term we are bullish but there are some things
to get through and over the next three weeks we will need to deal with
hot dry weather scares for South America. We want to buy the next
big break and still think it will happen.
Bean - Well, when it stops
raining, and there is now no rain in the forecast until next week at the
earliest for southern Brazil, we can get some explosive types of markets
and that occurred today.
Rice - Nothing new here as we
remain a little over bought and could consolidate for a couple more
weeks. Longer term, we like the market and will buy breaks.
Natural Gas - Warm weather
continues and this market keeps unwinding longs.
Cattle - No change in comments
here...I just don't see any risk to owning cash cattle right now.
DOW - We will sell rallies and
buy big breaks. We remain a little bearish here hoping for a break
to the 10,500 level or even lower.
GOLD - We remain friendly
and want to buy breaks.
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