Progressive Futures -- Update

Thursday March 31st -

General Comment - More questions than answers after today's report as the soybeans collapsed late in the session ending with a massive key reversal down for the day. Corn meanwhile held onto a gain for the day. Rice rallied at the close after being down all day...nothing makes sense.

I want to read traders comments and see what happened today before making any other comments but tomorrow action could be setup for a test of the major support in beans at $6.08. From the report, there is not much to really put our hands around but from the true technical, soybeans are too high, corn is too high and rice is...well...RICE!!! We'll let the action and news become more ingrained before changing a positions which has us out and watching.

Natural Gas - A lower than expected drawdown still couldn't put the gas in negative territory. Not with crude flying high with more than $1.50 cents gain for the day in May Crude. I still see it hard for this one to turn down without crude giving up and starting to move lower.

Wednesday March 30th -

General Comment - Reports tomorrow morning will be the guiding force. According to the market participants today, beans should be bullish tomorrow and corn bearish, but "who knows what evil lurks in the heart" of the USDA. One thing for sure, there is no reason to write many comments tonight so this will be short and sweet. One thing to watch for tomorrow, no matter what the report says, soybeans may have told us today, they are going higher and this report was only a delay for that to happen.

Natural Gas - Market held up today even with a bearish oil report. Crude came back later in the day so tomorrow's gas report will be key. Again, the fundamentals do not line up with the current action but the movers in this market don't care about where the price WAS the last time we had these fundamentals.

Tuesday March 29th -

General Comment - Doesn't look like anything will happen in the grains until after Thursday's reports so there is nothing really to report here. For rice, WMP was down 18 cents...back and forth we go. Lets see what the acres are Thursday and then maybe we can get some direction.

Natural Gas - April went off the board with a bang today and traders were hard pressed to say why. The rest of the complex moved higher and many were left shaking their heads on the move which tested the recent highs. Technically, this continues the positive tilt to the charts. Today's low becomes major support.

Monday March 28th -

General Comment - Not as much happening as I expected; however, corn did rally in the last 30 minutes while beans traveled from almost their high to their low in the last 60 seconds. In general, not much to conclude from this day. With the reports this Thursday morning, we may see the markets go sideways waiting on those numbers. Then again, we have some shorts in the market in corn that may not want to be there come Thursday morning. All-in-all, nothing to add to the current situation technically, so we will await more price action before making any comments. Rice came off the lows to close near the highs of the day but still down from last Thursday's close. Here too, nothing new.

Natural Gas - The short term indicators have gone short but the daily signals have not turned down. We may see another bounce here but it will hard for gas to make new highs.

Thursday March 24th -

General Comment - It appears that most traders wanted a four day weekend so trading today was very thin. This holiday break will probably send the market into over drive on Monday one way or the other. I don't have a clue which way but I decided to go through this weekend slick as a whistle. Here is our take, for what it's worth just before a major three day weekend, next weeks plantings report and next weeks stock reports. In other words, here is what we think just before the information comes out that could change everything!!!

Corn - The fundamentals are bearish. With the current carry-over and the amount of acres going in the ground, why should corn be going up??? It will take an outside market to move this one higher before we get to a weather scare. With that said, this is April 1st for all practical purposes which sets in motion possible weather scares in planting over the next four weeks and then we go into the drought scare season from Mid-May into the end of July. Current forecasts are for above normal rainfall and below normal temperatures during this time so right now there is nothing out there to suggest a problem anywhere. All in all, this market should drift lower with a bounce likely to close some of the recent gaps.

Soybeans - The damage is done in Brazil and now we wait for the funds to take action. They are long but not near record long positions so there is more buying power on the sidelines for the bulls. At the same time, we still forecast a record supply of beans world wide for this year. The fundamentals are bearish but the outside markets may be able to let this market rally still. Demand from China may be the deciding factor near term.

Rice - This is a tough one to call. We dropped below the sell point but now we are back up in the neutral price zone. US fundamentals are bearish with a large supply of rice in the US while the world picture is tighter. I might add, its not near as tight as some things would indicate. Remember, Thailand is buying rice that they will have to sell at some point. The question for me in rice is what about outside markets and what about the drought in Asia when the monsoon is supposed to start. Does the drought condition last a little longer than normal and create a problem with the monsoon season. That IS the real factor long-term. Short term, I can see it following the beans and if they just stay sideways, rice could drift lower.

Natural Gas - We have sell signal on all of our short term indicators but the one I like the most is still not short here. Fundamentals remain bearish but we all know what is happening in other markets in the complex. Today's report shows we are still way above last years level and in the upper portion of the inventory range for the last 5 years. There is little chance that is going to change much in the weeks ahead. All eyes need to be crude coming out of this weekend.

Wednesday March 23rd -

General Comment - Nothing new to report tonight. The down trend in corn is too steep and the second gap in four days is a warning of a rally potential in the next couple of trading days. Beans also closed at the high end of their range today and rice closed higher with another up day off of technical support but no real signal that its entering into a bull trend yet. For now, we will wait the market out expecting a bounce near term given the current technical picture.

Natural Gas - Sell signal tomorrow is a close below $6.92. This is the first technical sell signal but the real signal is down at $6.54. The strength index is not that high so another push higher is not out of the question. Tomorrows report will very interesting.

Dow - It is real easy to get influenced by the talking heads who have convinced themselves there is only one way for the market to go and that is up. We have been saying for a long time, the days of buying stocks and making money may not be gone but it ain't as easy as it use to be. The Dow looks to be testing the 10,360 low and my guess is it will take it out. Bonds will continue to drift lower slowly and the Fed is going to raise interest rates. All in all, there is no major bull move coming here. If you look at the CRB, it is telling you that things are changing and while they won't do it over night, there is no reason to be exposed to the stock market right now. Look for a bounce to sell stocks and if its coupled with a rally in the ten-year bond, get ready to sell it.

Tuesday March 22nd -

General Comment - I guess every once in a while they think we need a break in the action. Today was that day. The market taking a breather but closing near the lows of a day that say limited trading. We probably will see another push down but a move over $6.40 could bring in additional buying. All eyes remain on May Soybeans. With interest rates higher, the grains should start tomorrow lower; however, this is cause and effect. The rate is higher because of inflation and the grains have a say in that part of the economics for sure. The dollar should also be higher but for how long? I wouldn't be surprised to see the grains lower and then stabilize. If the funds start coming out, its going to get real nasty.

Rice - WMP up 20 cents as we see a tightening in Asia. We need to see a little more demand back here in the US and so far, nothing doing. We remain on schedule which is still 15% below 2003 exports. PB crossed back over 50% today but is in no mans land at 50.25%. In other words, sideways.

Natural Gas - Still nothing to say. Market remains in a consolidation area and could go either way from here. The Dow broke big after the close here so we may see strength in the Gas tomorrow.

Monday March 21st -

General Comment -

More fund selling took the grains lower tonight but we still do not have major sell signals in anything here but the rice. Rice dipped lower today triggering sell signals but then cam back to close near unchanged. We need follow through selling to confirm a top in rice and I'm not sure we will get it. In the beans, we had one major round of fund selling at around 10:30 which did the damage for the day. After that, nothing really happened as the market dies near the lower end of the range. We have a $6.17 level of major support here and then $5.95 longer term. PB is at 58% so no sell signal from the trend program. Corn is at 56 and wheat is at 59%. A rally from here could be violent especially if we start to see the dollar give up its gains of today. I'm back to day trading.

One more thing, today was a trend day lower for soybeans. This is usually the sign of a bear market but it was not that convincing. I expected the market to make a new low going into the close but that didn't occur indicating we may have corrected enough for now. If you are trading in here. Be careful and don't marry a position.

Natural Gas - Today was a continuation UP day as the market closed higher after taking out some support levels. Today's low is now major support and the place I'd short the market over the next few days. The crude started to reverse but held on to gains late so again, there is no sign of a top in these energy markets.

Friday March 18th - Long one tonight

General Comment - If you read below, our 5 AM comments from this morning, you will see we were pretty well right on for this day. In fact, I have a little trick I'll tell you about at the end of these comments, but first things first. Today's break is not good news for the bulls. The beans are the driving force in this run as we have been saying over and over again. The nine week moving average is at $5.68 as of tonight. That is 80 cents lower so there is little help from that support line. Our main computer system sell signal is at $6.26 in the May which closed around $6.49. My point is this, we have been super over bought recently. The PB climbed back to 85% in an extension of the bull trend and tonight it has corrected to 68%. With this break we are closer to where the super funds will start to head for the doors. While they haven't done that yet, THEY WILL DO IT!! So the question that will be the talk of the weekend is this, have we made a significant top or is this just a correction. Are the funds about to sell and go short or are they sitting back grinning at the prospect of a similar move that occurred in crude oil recently. A short term top, a correction, and then a move to new highs.

If you are long at $6.90, this is a significant top, if your long at $5.80, it's just a correction. If you are a farmer, looking to hedge the crop, it's just plain scary!!! My system has had me day trading for several weeks and making some nice change in the process. As I said last night, the easy money is over. Why do I think that? Simple, we have had a 42 cent break, there is both bullish and bearish fundamental news and the funds have already spent a bunch of money.

This rally has been so sharp, and the move has given us a lot of distance between where the market is and the major sell signals used by longer term traders. So when I said on February 22nd, "I'm going to give it lots of room", I meant it!!! Here is a few of things to remember.

1) Being short has been nothing but painful until the last two days.

2) Day trading from the short side has not worked in weeks.

3) The Funds have not started to sell out....YET!!!

With this said, I'm giving it room. I'm not convinced this is the top and I'm not interested in sell the top anyway. The market has to prove to me it has topped and it hasn't done that yet. Corn is the closest to major sell signals but it hasn't confirmed a top either. In addition, today's volume was low which is in line with a correction. Fundamentally, I can see it as a top but technically, no cigar. Next week could be ugly but it also may be a week of major surprises.

Now my trick...If you look at today's trading session, there is one thing common through out the day. In every thirty minute period, the market traded at a a minimum of $6.54 in the May contract. That means from 9:30 to 10:00 and then 10:00 to 10:30 and then 10:30 to 11:00 and so on. At 1 PM the market was trading at $6.46 1/2. It had just broken down the low of the day at $6.51 and was looking for stops. This is a classic expedition hunt for stops below the market. Since I have traded in the pit for several years, I realized it was just a hunt and they weren't finding them, so I bought May beans expecting it to trade back to its equilibrium price on the day. The price where it had traded in every 30 minute period all day or a minimum of $6.54 and that is where I put in the order to sell out the long. We rallied back to $6.55 letting me out before all the sellers on the expedition had been covered and then the market closed at $6.49. Not too bad when the market absolutely refused to give me a good day trade all day. Does it always work, you ask? Nope...but it always is worth the shot. I like to always look for the price range that the market has traded for most during a trading session. Then look to see where the market closes against that price. For example, today. The price most traded was $6.54 to $6.55, traded at in every single 30 min. time period of day. With a close under that price, the market is setup to work lower in the next session; however, a lot can happen before Sunday night's night trade, so I wouldn't and didn't go home short.

Natural Gas - Still no sign of a top. $7.09 is the mathematical uptrend line and the major sell signal is way down there at $6.45. PB is at 72% and the strength index, which normally tops out over 40 to 50% is at 29%. Yes, it could change any time, but for now, it looks like it still could go higher even with a nice correction.

5 AM Comment - March 18th -

The bean market is putting in another reversal to the downside in overnight trade. Look for consolidation at lower levels today and a poor day to be day trading. I am expecting that well over 50% of the range of the day will occur in the first 15 minutes today. $6.57 is technical support and then $6.48. If we turn higher later in the day, it could indicate stronger buying than I'm expecting her at 5 AM this morning.

Thursday March 17th -

General Comment - Is the correction over in just ONE DAY???

Make sure you read last night's comments. Today's action in beans was a classic correction in a bull market. Our objective remains $7.05 and now the technical traders may decide to buy more with that gap at $6.66 closed; however, there is always another side of the story. While I think the odds are 2 to 1 that we will hit the target and soon, a drop below today's low of $6.48 is a major sell signal. But I must brag a little, I saw today coming a mile off and bought the break at $6.53 in the beans and put a stop in on a close under that level. The market traded to $6.48 before starting a 24 cent rally into the close. I'm only day trading so I am not taking any trades home over night. This was too easy to see which means, the easy money in the beans is about gone. It's going to be harder in the future to sit here and make money every day buying beans and then selling them on the close. Tomorrow will be interesting but it looks to me, this market will continue to go higher in the next few sessions. Again, when the beans top, and they will, the corn and wheat are going to be in trouble. All of the grains, including rice, has their fate resting with the soybean market right now. By the way, we do have a weak objective of $7.45 in May rice but again, if the beans top before we get to that level, rice will not be able to go it alone.

Natural Gas - I look for a correction and some consolidation here tomorrow. The action in crude is flashing a warning of a possible pause in the move higher. In fact, it could turn into a spike top. Time will tell. I want to sell this one, but the sell signal is not even close to the current price so patience will be the name of the game on the short side.

Wednesday March 16th - Updated at 11:30 PM

General Comment with Soybeans Featured - Is this the top? I don't think so but I'm not sure. Today's action was a hook reversal down but it wasn't on extreme volume and price range in the beans. Here is what I think is happening and again the beans are the driving force. When they top, so will everything else so my comments are in particular about soybeans.

If you look at a chart, we left a gap which measures from Friday's high to Tuesday's low of $6.68 1/2. This gap will be closed if we trade down to $6.66 in the May. ( Yep, $6.66 which is not the best of numbers). If we close that gap and then start to trade higher, we could accelerate toward the $7.05 target we have been talking about; however, there are going to be some technicians who look at this gap as an exhaustion gap. If we close below $6.66, it could bring in some additional selling. Our sell signal tomorrow is a close under $6.53 so we have a lot of room in this market and tomorrow could be one of those wild ones but it might be Friday before we really see some fireworks. Bottom line, the commercials are not big sellers, the farmers aren't selling yet and the funds are still in a buying mood to protect current long positions. Unless that changes, I think odds favor closing the gap and then turning higher. As I write this, the markets are down a little in the over night trade.

Natural Gas - Low inventory numbers in Gasoline fired up the crude market and dragged natural Gas up with it. Still no sign of a top

Tuesday March 15th -

General Comment - Another big day up. The expansion phase I spoke about over the last two weeks is in high gear and there is no sign of a top. As we have been saying, this rally is being led by other factors than fundamentals. We are approaching our target in May Beans at $7.05. Remember, this is a target and doesn't mean it won't go higher. I expect a violent top when it occurs. Probably one of those 40 to 50 cent range days in beans with the market sharply higher early but ending sharply lower. What concerns me is that when we top, everyone will be trying to sell it at the same time and it could get really bloody. For now, no sales recommendations in any of the markets. We remain long very lightly and day trading when we can. I expect a top in the next 8 trading days but it could be at much higher levels. Hopefully, it won't be tomorrow while I'm here in DC.

Monday March 14th -

General Comment - A very dead day when all is considered. The funds seemed to be absent today and while the market tried to rally after the lower open, there was never any fire like we have seen in last weeks trade. We may consolidate here for a few days. In general, there is no sign of a top yet so if we get a correction, it will probably be a buying opportunity. We continue to day trade waiting to see if the market can approach our current target as we discussed last week (read below). If we can approach the $7.00 mark in Soybeans, we are going to get very interested in an aggressive sales approach. That target is still our objective.

Natural Gas - Still no sign of a top as crude plows higher. This is an energy complex led rally and the funds are buying all commodities across the board no matter what the fundamentals. This shift in conditions will make it hard to determine where the lows should be when the break comes and it will come. I wouldn't be short for anything here.

Monday March 11th -

General Comment - The funds continue to buy and just as we said last night, the grains are going into expansion bull markets. This current trend will stop but it may be another 10 days before it run its course. Please read all of our comments from last night as they are just the same for tonight. PB on beans crossed back over 80% which indicates the expansion and our target of $7.05 remains is place. Look for another 10 cents on corn. REMEMBER, this move WILL end and when it does, it will launch a round of selling that could be panic selling. My hope is that this bounce is high enough to do some selling of the '05 crop, so get ready. It will be interesting to see just how long the funds are as of tonight's COT report.

Thursday March 10th -

General Comment - The reports today were neutral but the market is not trading S&D as much as its riding a wave of inflation worries. Index funds were huge buyers today as the CRB index continues to gorge into new highs. Remember, these funds have a huge amount of money. So much so that they could buy every grain of wheat, corn and soybeans in the US and still not have spent 10% of their money. That is incredible buying power so right at this moment, its not a 410 million bushel carry over in beans at play, its fear. Also, the market may be changing plateaus. We talk about this several months back thinking it was going to happen in the next year. It appears that is underway now. A change of plateaus could add 10% on the base price of all commodities.

Soybeans - Today's close is into new highs. Our target of $7.05 remains firm and possible. We are at 75% in the PB indicator tonight but the market has every appearance of a market that will expand which means it will go back into extreme over bought conditions before topping and tight now, it about 30 cents away from entering moderate over bought conditions. If you are short here because of fundamentals, take a hard look, there is a ride to downside coming and it is going to be a great move, but now IS NOT THE TIME TO BE SHORT!!! I'm buying it on day trade signals and I am not taking it home at night. As we approach $7.00 I'll take a hard look at getting long puts.

Corn - This is the weak sister but I can see it up another 10 to 15 cents if the funds keep coming for it. This kind of buying is extremely powerful. We are not short here and unfortunately we are not long either. The problem is, once the interest rate and inflation scare ends, corn will have a correction big time.

Wheat - 7 cents away from its next resistance but I doubt that stops it unless something breaks on the inflation front. Look for wheat to continue with the beans advance.

Natural Gas - Today gas broke with the crude correction; however, today was key reversal down and indicates a possible top. We need some confirmation here with additional selling. The sell signal is at $6.42 tomorrow. I doubt we get there. A remainder, even though we have a formation on the chart indicating a possible top, this market remains in a bull trend with major support points between here and the sell signal. It will not top easy. In other words, we have some time and work to do before there is any confirmation of a top.

Wednesday March 9th - Quick one today...

General Comment - Markets were quiet in front of tomorrow mornings report and there is nor reason to make any comments about what is ahead until we see those numbers. I guess I'll be the same, quiet. We'll have an early morning update tomorrow.

Tuesday March 8th - Night Comment 10 PM

General Comment - Not much happening but the beans are a little higher tonight with talk of China in the market for US beans and the idea that Thursday's report is going to be friendly beans. The truth is, the funds defended their long position today and came in to buy big time hoping for more follow through buying ahead. They may be right. This is not the time to be short beans yet. Rice is lower by 5 1/2 cents. Funds were the buyers here today as well.

Tuesday March 8th -

General Comment - The corn and wheat followed beans higher today with a reversal patter in corn. The markets have a tough time ahead with the USDA report. I expect no real bullish news there in the S&D report but then, this is the time of year when you can get some positive surprises while in a bear market. We are content to look at the numbers and watch the trade in corn and wheat.

Soybeans - We talked yesterday about a reversal to the downside but today the market, after starting lower and trading into the gap, shot back up and put in an impressive reversal to the upside. We covered shorts this morning like most technicians, once the market entered the gap. When the selling dried up and we got some short term buy signals we hooked on long and rode it for a nice pop although, I didn't ride it all the way. Actually, at the end of trade we got another buy signal and 5 minutes later got a sell signal, so there was some back and forth at the end. From a technical stand point today was very bullish. While I don't see it fundamentally, this market told us it wants to go higher and if the gap holds as a measuring gap, we have a target of $7.05 to $7.11 in the May. Is that possible? Not looking at the fundamentals but there is no denying the target. If the market fails in the next three days and moves below $6.09 in the May....SELL THE FARM!!! It is going to be interesting.

Rice - Nice move up today. We talked last night about a possible pop but today's move was more than just a little pop. March is in delivery and was sharply higher at the close. There was no real selling at the end so we may work even higher. Is this a sign that the world shortage is coming to the US. Thursday's reports will give us a clue. My guess is that funds are buying here but I have absolutely no proof of that yet. Like I said, its my guess. (Update...We got confirmation late Tuesday. Funds are indeed buying here.) Resistance is at $7.10 or 15 cents away. The shorter term charts have gone long.

Natural Gas - Another move up today but its looking tired. We actually day traded it today short and did alright but didn't take it home. I'm looking for a top here and in crude. Heating oil may be a good short too coming up.

Monday March 7th - Night trade update

General Comment - Soybeans are down 4 cents in the early going and this is setting up just as we feared in our comments below. While I don't think we will open more than 10 lower tomorrow morning, it there are weather forecasts turning and the funds comer in quickly in the morning, there will be no sellers and as I said after the day session close, this could get real ugly!!! Even so, it's very early on Monday evening (7:38 PM) so there is a long way to go in the night session. That may be both good news and bad news. We are short beans, have sold all of our corn and now look to sell wheat if we can get a good signal there.

Monday March 7th - Look for update tonight!!!

General Comment - Overnight the market was higher but when the market opened, it was over run with selling. The market stabilized but at the end of the day, we have a trend day down. This is where the market makes new lows throughout the day. Tomorrow market "could be" real ugly especially in the beans. Now I'm saying "could be" not "is going to be". Look at a chart and you can see the gap is just sitting there. A sharply lower open and we will have an Island reversal. Again, this would take a big move down tomorrow. In any event, today's action is not bullish.

Corn - $2.11 1/2 is the sell signal here tomorrow. Frankly, I like selling it on a close below this level but the question will be how it gets there. We have already sold all of our corn for this year and are looking for replacement calls expecting an interesting spring.

Soybeans - Well, I took home the 640 Call - 620 Put straddle last Friday and just after the open, took off the call. It didn't work with a big move one way or the other but it worked as I am still in the Put tonight. Tomorrow's trade will be very important as we test major support. Here is the problem with beans as we have been pointing out....WE HAVE TOO MANY!!! Even with a 15% loss in Brazil, we still have an all time record of beans in the world. With no further weather scare until spring in the US...Selling is going to be the driving force ahead.

Wheat - No sell signal here yet and we have a ways to go. This is what happens when a market moves too far too fast. To be safe, we'll give it room.

Rice - Another big pop on the close. 15 cents up in the last 60 seconds. You would think the commercial selling this market all day and then getting his head handed to him would learn. Oh, I forgot, these are rice commercials we're talking about!!! We could rally based on the charts but there is no real clear direction.

Natural Gas - Looking for a sell signal but there isn't one yet. The sell signal is 20 cents lower and the market is tied to the Crude right now, rightly or wrongly. We are running out of time for draw downs in gas inventory to be bullish. Technically, still no reason to sell.

Sunday March 6th - The market is higher in the beans tonight but lower in corn. Soybeans are up 5 at 9PM and corn is down 1. There must be two sides to the news. We'll see what happens in the morning but again, I think we are getting close to the top.

General Comment - A "place your bets" day with the weekend upon us. The beans tried to hold up but failed to advance in the last few minutes closing up just 2 cents. The first 15 minutes this morning saw the high and low of the day. The weather in Brazil will determine the start on Monday's trade, Sunday night. We will update this site around 9 PM Sunday and tell you how the market is doing.

Friday March 4th -

Corn - The sell signal here for Monday is at $2.09 which is 8 cents lower than the market. I'd love to get a higher sell point that gives me confidence to short the market. I think next week is the swan song for beans, so any chance of selling higher will come early in the week.

Soybeans - As stated above, the weather this weekend will be critical. I bought an option straddle today taking home the $6.20 Put and the $6.40 Call. If the market jerks out of its shoes on Monday in either direction, one of them should make more then the other losses. If we start where we closed today...I'll take a hit in both getting out. Like I said, "place your bets." I day traded the beans today from the open on the long side and made a very little. I expected the market to make new highs in the last 30 minutes and fail, but that didn't happen. Frankly, the close looks suspicious as the selling drove the market back toward the low of the day. Monday will be interesting.

Wheat - I decided to take my profits in the short calls today. Probably a mistake, but I didn't want a lot at risk going into this weekend. I still think this market should be sold but soybeans will have a lot to say on the timing of that. We'll take a long look at next week.

Rice - Another down day but once it got 15 lower, here came the buy orders and at the end we saw a strong move with the market up 13 cents in the last minute. From what I understand, a commercial was the seller here today pushing the market down. In fact, they looked like they were dressing the market. When the market rallied from the lows, they pilled back and waited to try welling it again in the last 30 minutes again trying to dress the market down. What they found was more buyers and the market rallied to make new highs. I day traded it again from oversold back to unchanged but didn't take it home. We may see some strength in the overseas market Monday. It's not enough to move WMP back higher but we may see the end to the small corrective down turn in prices there following the elections in Thailand.

Natural Gas - There was reversal down here last night and reversal up here today. I think we will stay firm a few more days as we wind up this current cold spell. I'm looking to sell it but no sign of a sell signal yet.

Special Thursday Night Comment - Short one tonight...

Market started lower today then came back and looked like they were ready to try again to take out resistance, but tonight, the markets are lower with beans down 5 cents at 10PM. Corn is down 1. In my opinion it's just a matter of time and the grains will correct back down with soybeans taking a big hit; however, this market is similar to 2003 when the beans in the US had a late drought which added $3.00 onto the beans from August 1st to the end of October. This is why the funds are long and trying to stay that way hoping for the same kind of run with the drought in Brazil. Maybe they get it but the odds are against them. There is just too many beans in the world right now; however, a 25% loss in Brazil would sure indicate higher prices than where we are right now. I just don't think we can get that.

Tomorrow will be one of those "place your bets days". I may go home long a call and a put (a straddle) in the May beans and see what the weekend gives us.

Special Wednesday Night Comment -

After the reversal in corn yesterday, the market is lower in the overnight which is increasing the odds that we have a top. We could rally if the beans can hold their gap level but they too are lower and the action on Wednesday is negative. If we take out $6.20 in May today, we should see additional selling hit the market. Thursday is a big, BIG day.

Wednesday March 2nd - Special Update Later tonight @ 9 PM

General Comment - The markets all started higher but the corn couldn't hold it and closed with a key reversal down. Soybeans opened on their high and spent the rest of the day in a back and forth market but in general created a " V " day where the market sold off and then rallied back but didn't get that close to the high of the day. I guess it looks more like a backwards "check mark" than anything. Wheat took out yesterday's high but didn't close lower on the day as it closed up just over 2 cents but closer to the low than the high. We sold corn just after the open and took home a nice little profit, but we got cut up trying to trade soybeans as they methodically went to every buy or sell point and then reversed. I HATE DAYS LIKE THIS...anyway...bottom line is, I don't have a clue. I like the technical action in corn indicating a top, I think the beans are close to one as well but the fact they have not closed the gap left on Monday's opening is starting to give more credence to a further leg up in the beans. Tonight's trade will be important and tomorrows action should tell us what's next.

Rice - Market closed down 7 after being 22 cents lower. I can see it either way. There is no real reason to be trading this one. Much more fun in the beans.

Natural Gas - This is the fourth day in a row and the 6th in 7 days where the market closed higher than its open. This is a strong indicator that the general market does not have enough selling to stop the market from advancing. We may be getting close to a level where the selling will be enough but that could still be a few points away. Crude is so strong that the heating oil / natural gas cross over can have a major impact. The recent cold weather also has given the bulls something to talk about. Now we'll see the DOE numbers tomorrow and see if there is any change in the long term outlook for inventories. I think this is a rally to sell.

Special Tuesday Night Comment -

The market is up tonight with beans ahead by 6 cents. If this holds, we may see a stronger market tomorrow and the gap, if it remains open, sets up an advance toward the $6.50 level quickly. The wheat and corn are both up 1 cent which means nothing. If we can get a big rally in the beans we may see corn and wheat make new highs for this move but that will take the move to $6.50 in the beans. Now, what if we don't hold these night gains? Then we are setup for what we talked about below. Right now, it looks like the market will hold and maybe even rally through the night. Tomorrow could be something else.

Tuesday March 1st -

General Comment - Well now!!! If you will read below, we called this one fairly correct at least in beans. Tonight's trade will be interesting as it will give us a hint regarding the direction of trade the next few days. As I said last night, we came in looking for a top and got the signal we described to a tee in our general comments. We opened lower, rallied made new highs and then sold off. We sold the rally and then kept a short position over night and we'll see real quick if its a top or not. The only commodity giving us a topping formation is beans. We need follow through tomorrow and IF and this is a big IF, but IF we open lower by 4 or 5 cents in the May beans tomorrow....LOOK OUT!!!! That sets up an Island reversal and is very bearish. Again, I'm not saying that will happen, I'm only saying IF it happens. I expect to short the corn tomorrow as well if things look bad in the beans. This is no time to be long there if the beans are topping. If the beans can reverse right back up on more drought conditions in Brazil, then all bets are off. Watch this carefully.

Rice - I thought it could be boring but it wasn't. Tomorrow will be interesting as the WMP is down 13 cents. That is a good thing for premiums if you still own old crop but if the drought talk in Asia starts to light up their export prices, this move down in WMP will be short lived. Watch it carefully.

Natural Gas - After getting over bought, the market is consolidating gains. Our short term indicator, which will turn bearish first, is on the brink. We could sit in a range for a while. A move over $6.84 in the April should bring in more buying. Longer term we see it back down from here but near term, it could hold up given the rest of the energy complex.