Wednesday May31st-

Corn - We finished our roll to day to September and are looking to cover the backside of our September 250 -320 call spread.  We will buy it back at 5 cents tomorrow if we can get it.  The wheat break and probable top may slow the corn market a bit near term but weather is the only factor in the next 8 weeks.  We would like to sell some corn on a pop to the upside.  Long term we remain bullish.  Be sure to read the wheat comments below as well. 

Soybeans - Nothing new...we'll wait to see where a good trade shows itself.

Wheat - If you followed our advice last night you are 66% sold in wheat at substantially higher levels than the close tonight.  We sold on the close last night and then today after the market broke the $4.05 level.  The down side near term is $3.70 to $3.65 but I don't see it a lot lower than that.  Also, the next few days could see more strength here but look at the seasonal conditions and the odds of a major run from here as combines start to roll in the wheat belt are slim.  Yes the crop is going to be down but there is supply and it needs to be spread out in the selling phase and that means lower prices to encourage storage.  The same thing will happen to corn at some point.  Once we get past harvest or around 75% harvested, I will be looking to get back in the long side on anything sold.  Now, the risk is to the owner not the buyer...but that will change.

Rice - Correction??  I'm not sure but I think so.  This is one I want to buy but I'll give it some time to see what it gives us.  Next week I will be in Chicago for the whole week trading on the floor in the rice pit.  I'm hoping for some action but who knows.  Long term we remain bullish wanting to buy breaks.  We are 50% long right now and the market is almost back to where we sold some of the position off.  We'll get back in on a good buy signal.

Natural Gas -  Saucer bottom remains a possibility as we talked about last Friday (read below).  I am looking now to own options here as the risk is more to the upside with the approach of our first hurricane...whenever it happens.   

Cattle -  Read last night...I couldn't have ordered a better day.  We sold the June and then waited for a buy signal on the August...     never got it.  We'll watch it close as the market may march on higher near term.  We have not quit gotten to our target but a correction would sure make me feel better.

DOW -  Rally today...what about tomorrow.  The back and forth in this market is indicative of a top and right now, all those people who were so sure the market was going higher, are only sure that they don't know anything.  More selling possible near term. 

Tuesday May30th-

Comment -  We wrote exhaustive comments last Friday.  If you haven't read them you should as nothing major has changed except in wheat.    

Corn - Market started higher but couldn't hold and sold off the highs while still staying higher for the day by about 1 cent across the board.   Weather remains mixed but the corn market is not wanting to turn lower on the current situation.  I wouldn't be surprised for a test of the $2.50 level again in July as we keep rejecting the $2.58 level.  Sometimes you have to break a market to rally it and that could be the case here.  We are starting to roll all positions into September but are in no big hurry.  We have a day system that worked well today in rolling out of the July...let's see if tomorrow it works??? 

Soybeans - Nothing new here.  We are sideways until weather is better known.  I think a scare is possible but how do I make any money with it?  It may be a small amount based on what I'm seeing in here.  That would come through a very small ranged bull call spread.  Like a 620 - 640 August trade. 

Wheat - There was a change here today as I do not like this at all.  A massive Key Reversal down and this reversal makes the $4.05 support zone critical near term.  I want to get to 33% sold NOW!!!  If the $4.05 level is taken out, I will get to 66% sold.  Tomorrow is key as follow through selling could signal the end of the current bull market in wheat.  A break to a minimum of $3.84 is possible with $3.65 as another level of support.  The weather is over and now it's harvest time.  We will want to buy back and you should sell ONLY if you are willing to get back in the market if your basis real good right now.  If you are not willing to do that, store because longer term I still see it higher.  We will use July futures to hedge for now and since we are so close to the July expiration date, we may buy puts in here if the $4.05 level becomes more in play.   

Rice - Read Friday's comments...no change.  If we trade over $9.65 and then reverse...we'll have a decision to make for sure.

Natural Gas -  Read Friday...no change at all.    

Cattle -  OK...We started the roll today expecting the market to pull back from being over $80 in the June.  Let's see if it happens.  We are legging out of June and into August if we can get the right action in the June which is a move lower after the first 30 minutes of trade is higher.  We'll sell the June and and then buy the August 20 lower on the day.  

DOW -  We wrote a lot about this one on Friday and there is nothing else to add.  A move under 11,000 is possible in the very near future...like this week!!!

Monday Night May29th- 7:00 PM -

Comment - The three day weekend is over and apparently there is no surprises.  The market open higher by a penny in July but has since sold off to where it is down 1 cent.  The beans and wheat are now lower as well.  The rainfall was not as heavy as expected but there is more rain in the forecast tomorrow.  The amount of rainfall coverage will have a lot to do with this weeks action but there is little doubt, we are in the the beginning phase of the full fledge 2006 weather market.  With rain forecast for tomorrow, we could see profit taking hold up through the night but the 6-10 day weather forecasts are not helping the bears past tomorrow.  There will be another weather run in the night and that could show more or less rain so we may still see some wide swings in the session.

Saturday May27th- 10:00 AM - I will try to have a night trading update here by 8 PM Monday evening.

Comment -  We were down for a day but have been able to correct things. You didn't miss much as you can see if you read our Thursday night comments. 

Corn - Slow day in front of the three day weekend.  The market did try to go higher earlier but then dropped back to a marginal gain as forecasts going into the weekend are not that hot!!!

Nothing has changed here as we still have an abundant supply of corn for now.  The main point tonight is that the phase has shifted into a positive one regarding weather and it has done it much faster than I expected.  Dry weather from here on out will be bullish.  Forecasts are not putting that much heat into the Midwest but during the June 6-9th period it is calling for well below normal rainfall.

Let's talk: -   If you are new to this site then I need to point out the obvious...my strength in market analysis ends when it comes to weather.  Yes, I was a television weatherman (many years ago) and yes...I took meteorology classes at Texas A&M,  WHOOP!!!   Even so, I am no weatherman and even the guys who do it for a living like Dave at WXRisk, who I use exclusively for weather forecasts, will tell you, "it ain't easy."   I can have all the charts telling us one thing and if the weather says something else this time of year...we are going to go in the direction of the weather.  What the charts and our analysis will tell us is what the traders THINK the weather is going to do.  I believe in human nature and if you buy corn because you think the weather is going to be dry, it will show up in the daily action and so will everyone else who is trading.  If the forecasts change coming in Monday to Hotter and Dryer...how will the market trade?  Do I really need to answer that??  Bottom line is this...for the next 8 weeks or so I get to follow the weather forecasts and try to figure risk in the market based on the changes of supply brought about by the weather which changes every hour...sounds like a whole lot of fun.

Soybeans - I sound like an echo in a cavern...IT WILL NOT GO UP UNLESS THERE IS A DROUGHT!!!!  Can you hear that echo across the internet???  Anyway, we will see some action here but if we get a scare going, you are going to hear me start screaming to buy Puts and roll them up as we go higher.  If you are a big bean producer, you need two things...a marketing plan and the money to carry it off because it's going to be expensive.  It is also going to be a lifesaver.  The plan is easy, we will recommend a scale up Put buying program that rolls up on advances.  If you don't know what that means, contact me and send your email address.  I'll send you the basics for an introductory price of...just kidding...  Look for beans to start trading a little more actively in the next few weeks.  

Wheat - Market higher but off of highs.  Can rain affect the wheat crop now?  Probably not, so this market is looking all over the place for something to trigger it.   From a technical stand point we have two hook reversals at the top of this market but there has been no real follow through.  Is this the top??  Could be but a trigger event is going to be really needed to push this market down near term.  Harvest maybe the event but right now it's too early to say if we have reached a short term or intermediate top in wheat.  I'm still long but getting concerned. 

Rice - Well, you see I too make mistakes...and then have to talk about them right here on the internet!!!  Anyway, we pulled back to 50% long this past week and as of now are out about 7 cents on the 20% we lifted.  It's not much but it could be more if we aren't right on the market testing its break out.  Friday's action is a little help as we pulled off of the highs and reversed in the old crop; however, we could still move higher into that target area of $9.65 before we get any more of a pull back.  So officially, we are 50% long and if you're not there...you should get there on any downward movement.  Use a trailing limit order but get back to 50% when you can. 

The one thing that is very bullish to me is the amount of rice the commercials are setting up storage for to carry over into the new crop.  That is rice not coming back onto the market...EVER!!  This is bullish especially when you see that the commercials are the big shorts in the current market picture.  I doubt they deliver or let go any of their cash stocks unless we are going to get a super large harvest out the lower acres for this year.

Natural Gas -  OK...I may be really jumping the gun here but...have you ever heard of a "saucer" bottom???  I can't draw one and don't have time to go looking for one but trust me they exist.  They are usually found in a market that is tired and while still trading lower acts like it can't really push much lower after making new lows.  Then is slowly goes more sideways and then starts up very slow.  The end looks like a rounded bottom or the saucer of coffee cup.  We may be in the beginning phase of one which would indicate we still will make new lows here near term. 

The problem in my mind to that theory is I still see a major upward spike coming and am trying to time a call strategy for hurricane season.  These two formations do not go hand in hand.  As I said earlier this week, I can see the market down another 50 to $1.00 fundamentally; however, the risk to the upside is $3.00 and that is what I have to trade for.  

Cattle -  Our long trade in cattle is really good now as we have over a $4.00 profit in it and see the market moving back toward $81.00.  We will have to roll our June's to August Tuesday and we may do it using an in the money call with a covered long call at a higher level. 

DOW -  OK...let's blow our horn just a little.  Look back a few days and you'll see where we said the market should rally back to the 11,300 to 11,440 window.  That is occurring right now.  The question remains...is this just a rally after a major top or is it the beginning of another leg up?   I'm leaning to a major top but the proof is still out.

Let's Talk: I keep hearing of the "multiples" in the market.  Traders love to use the P/E or Price to Earning ratio and say whenever the market is trading at the current ratio levels of today, it's a buy.  There is a problem in my mind regarding a basic assumption in this analysis.  P/E ratios can change based on two things...Price of the stock or a change in the earnings.  If the price is at $50 and the earnings are $5.00 that is a multiple of 10 and should be bought.  Analysts will be screaming that the multiples are in the buy zone so we should buy the stock; however, if the earnings drop by $2.50 cents, now that multiple it up to 20 and it's not such a good buy is it.    (Remember there is a big difference between earnings and dividends...if it was a 10% dividend...well dah!!!) 

So the key is earnings...plain and simple.   When a company gives guidance and says they think earnings will slow down, such as is happening in most cases right now, that is not a good sign for the multiples which currently seem so low.  Bottom line, there is plenty of room for a 1,000 to 2,000 point break in the Dow and I believe, a recession is going to happen in the next 24 months.  That sets the odds favorable that this is indeed a major top; however, I will let the market prove it first.  If we break under 11,000...it's over for a while.

Thursday May25th- 11:00 PM -

Comment - Just a short update tonight...nothing has changed in anything except we were disappointed today we didn't get more rice bought before the rally into the close.  We out thought ourselves here.  We have an upside objective well intact at $9.65 in November and today's close is just 15 cents away from it.  We remain 50% long and will take more profits off the table IF we get a good reason once hitting the objective.  Remember, just because we hoit an objective doesn't mean it is the top.  It just means we hit the objective...

Has the corn turn phases on us and now gone to a plus or normal phase where dry weather is bullish??  I'm not sure but I think we are close.  The weather is not that hot after the June 2nd time frame but the rainfall is going to be light according to all forecasts right now.  By the second week of June, I think we will be in phase one weather setup and the weather market of 2006 will official start.  At the current price there is no real weather premium in it so again, buy dips. 

Wednesday May24th- 11:00 PM -

Corn - Down today and looking more like we have another several days of potential pressure.  None the less, we feel that this break is a buying opportunity and we would buy the break.  You can do it two ways, scale down or buy it when we have a buy signal.  I've said it before but I will repeat myself.  We are changing from a negative phase on weather to positive and so far there is not conclusion that we have made the switch.  If could take well into next week or even the week following but it will happen.  We remain bullish but realize we may give some things back near term.  Remember, if we get a weather scare, this market won't go up in 4 cents chunks...it will be 10 cent chunks and you will not be able to buy it without paying up for it.   

Soybeans - Beans are closing in on where there should be support this time of year.  We are being patient because the options are expensive but we know we are risking a change in the weather to drive the market sharply higher.  It will take one scar to drive the market higher and then, we will want to sell it by buying options. 

Wheat - If you read our comments from last night, you'll see the market dove right to our buy point.  Now the market needs to find support.  In the overnight session as I type this we are down another 4 cents.  I the market is good, we should see a reversal tomorrow back up...if we don't then the market is setup for a major sell signal.  Gold is having some affects here as the general commodity push has stalled.  The dollar is going back up but to be honest, where is it going?  Longer term, we see the dollar down and this break in gold should be bought. 

Rice - Nice break today but I'm not sure it is over.  We dropped back to 50% long tonight just because we wanted to take some profit.  Let's see if we can test today's lows again in the next few days. 

Natural Gas -  Read last night...nothing has changed.  The risk is big in both directions but it is much larger for the shorts in this one.  We covered a little more exposure on the long side today and will continue to follow the market down here buying in needs for the summer months.  Specs should be looking at some options here as well for the hurricane play that is coming. 

Cattle -  No change...we are still long and liked today's action but wished it would have close closer to the high.  No damage to the chart and we like the market to move higher.

DOW -  A move back toward the correction window is still the best guess for me right now.  I'll write more on this later in the week.

Tuesday May23rd- 3:00 PM -

Corn - No follow through to yesterday's hook reversal as selling at the end of the day took us down 4 to 5 cents going into the close.  It's early for me to know exactly what happened but I suppose it is a weather forecast changing somewhere.  That happens...problem is I don't care what the forecast is, corn is too low given all the fundamentals.  We will buy breaks and right now anything under $2.50 in July is a buy.   

Soybeans - Nothing new here.  A bounce today based on general commodity fundamentals.  I don't see a big bounce coming here without weather...have I said that before?  Well, the bottom line is near term I don't want to be short but long term I don't want to be long.  I'm looking for an option play but still want to wait until dry weather is bullish not bearish.  That could come later this week. 

Wheat - Hook reversal down.  Tomorrow the buy signal is at $4.12 and the sell signal is $4.60 or 37 cents higher than the close today.  For now, we will hold to our long position and give the market the room it deserves with all of the questions on the 2006 wheat yield. 

Rice - WMP up 10 cents today...there goes the LDP on the long grain.  Good follow through today to yesterday's breakout.  As we said last night, we have another formation projecting a move to $9.65 in the November and have increased longs to 70% in the new crop.  If your not there, buy breaks!!!

Natural Gas -  Any break back to recent support MUST BE BOUGHT!!!  I know the fundamentals, I know there is more gas than room, I know gas should not be this high, I know...I know.  A also know there is going to be a hurricane that will give me the chance to sell gas at a higher price than it currently is. 

Let's talk!!!  Where is the risk???  On the downside its still $1.00 to $1.50.  Man that is huge!!!  What is the risk to the upside???  $3.00 to $5.00  Anyway you slice it...the risk in the market is to the short!!!!  By the middle of June I want to be long here not short.  By the middle of October...I want to be short the WORLD in gas!!!

Cattle -  Same as last night...We remain long as the break is finding support and consolidating gains.  I may buy more in the next few days if the signal is generated.  We are 50% long right now on cattle needs for this fall.  We are in a highly selective hedge mode which means I don't mind getting out of this position and getting back in several times.  I do like the position right now and still expect a move toward $81.00 in the August. 

DOW -  Today's rally maybe the first of several days where we move higher.  The window to watch is 11,300 to 11,440.  If we get a short term sell signal AFTER trading up into that zone, we will sell everything we have left and move to 100% cash. 

Monday May22nd- 7:00 PM -

Corn - Well, now what???   Most of the comments tonight point to today's hook reversal up as a connection to Wheat.  The other big thing today is the report showing Open Interest went up on Friday not down.  The funds sold 23,000 contracts and open interest went UP!!!   That means commercials were buyers all the way down and I don't think we are going to break much more right now based on the current technical and fundamental action.  PB is 54% and well balanced.  Can we rally big near term?  I don't think so but again, if we turn the market to a positive phase in weather where dry conditions are bullish, we might see a good pop in the next three weeks. 

Like I said last week, the easy trading here is over...things are going to be tricky from here on out.  If wheat tops here in the next few days, then corn has to go it alone and I don't think it will be able to muster a lot without weather near term.  Remember, there is a huge crop left from last year; however, the long term fundamental support December corn over $3.10 and I can argue $3.20 with a normal yield.  We will still buy breaks and sell some of the crop on a weather scare as well.  Dang...I love this stuff!!!

Soybeans - In the trade today it appears that the negative phase is still in tact.  I want to own some calls at a lower level but we are looking for a positive shift in the PB to go ahead and get some positions on.  Again, this is a weather scare trade only.  Longer term, I want to sell any bounce here.

Wheat - No sign of a top but the market is showing signs of extreme volatility which can occur at or near a top.  Tomorrow will be interesting to see the follow through.  We are not selling yet but watching it very closely.   

Rice - New contract highs in the new crop.  That is where we are long and want to hold those positions.  We added some more on the break out which by the way may bring in more fund buying as the "Turtle" trading population gets buy signals on today's breakout.  We now have another formation projecting a move to $9.65 in the November.  We are long now at 70% in the new crop. 

Natural Gas -  Hurricane season is expected to be active according to the National Weather service.  On the next break, I'm getting long IF I can get one. 

Cattle -  We remain long as the break is finding support and consolidating gains.  I may buy more in the next few days if the signal is generated.  We are 50% long right now on cattle needs for this fall.  We are in a highly selective hedge mode which means I don't mind getting out of this position and getting back in several times.  I do like the position right now and still expect a move toward $81.00 in the August. 

DOW -  I'd still like to sell another rally here as I think a Kondratieff top is still likely.  I expect the market up tomorrow (Tuesday) just because its over due but after that, I still think the market needs to be sold on a good rally. 

Friday May19th- 2:00 PM -

Corn - Read last nights comments...Today's break is exactly what we talked about and it might not be over with yet.  Can July go below $2.47?  Well, it can but for how long?  That is the buy point for you who have been patiently waiting for this break.  We would start in at $2.50 and buy a little if the break continues.  The heat dome now in some forecasts could turn the price sensitivity from a negative phase to a positive one and that is when things could get explosive.  I'm not saying it will because the long-term drought outlook is not looking good for a major weather problem in 2006.  That is why on a scare we will get very aggressive on the sell side.

Soybeans - Same thing as last night..."Nothing new here.  We need dry weather to be bullish to crank this one higher."

Wheat - This could be an interesting weekend. The market sold off hard today but rallied back to almost unchanged but then stalled setting up next week as a pivotal week.  We'll see the trade Monday and see what is going on.  Get ready to sell some wheat as it looks like the possibility is growing for some major resistance right here before harvest. 

Rice - Held pretty good as the fundamentals do not allow for much of a break here near term. 

Natural Gas -  An inside day today with a lower close means nothing.  With crude under $70.00 a pull back is possible if the crude checks the $65/barrel mark.  We still are buying this break on the long term issues but very slowly.  Hurricane season is right around the corner and then comes TS#1 (Tropical Storm).  Things will heat up when that happens.

Cattle -  Good break today but no buy signal after we moved lower so we'll see if this break has any more in it next week.

DOW -  After 4 of 5 days being lower, today needed to be a bounce.  I'd like to sell another rally here as I think a Kondratieff top is still likely. 

Thursday May18th- 4:00 PM -

Corn - The market worked lower today as the weather forecasts are in what I call a -1 phase.  That means the wet weather is bullish and dry weather bearish.  This is not what will take us to new highs near term.  SO with a dry weather forecast being bearish, we can expect a down draft here and it may last 5 to 10 days.  The the market will stabilize into a -0- phase before going into a +1 and possible a plus 2 phase.  For now, don't be surprised if we go 5 to 10 cents lower and don't be surprised if we move higher and over the $2.70 level in July.  If that happens and we are in a -1 phase using weather, we will sell some of our positions believing lower prices before higher. 

Soybeans - Nothing new here.  We need dry weather to be bullish to crank this one higher.

Wheat - If you read our comments last night you'll know we are looking to get something sold.  Today's action was bearish and may setup a move lower.  Tomorrow's trade will be important and we may step and buy a put just in case in the July wheat contract as it has plenty of time but is not too pumped up with volatility.

Rice - We will buy breaks and there will be some but the question is from what level.

Natural Gas -  New lows and a bearish injection number.  Can July get under $6.00...maybe but are we starting to press our luck regarding weather scares?   Right now, I'll say no but longer term a low here in the spot remains possible.

Cattle -  Nothing new here.  Back and forth as the story goes and I am wanting to own a nice break here. 

DOW -  Down again today after trying to rally.  11,000 is huge support and the market may actually test it on this break.  Longer term everyone knows we are bearish...near term, it could have some back and forth moves giving us a chance to make some money. 

Wednesday May17th- 2:00 PM - AND SO IT BEGINS

Corn - The key to what we are going to point out is today's action.  We started higher but not as high as the over night trade of +3 cents.  Then we sold off going down on the day and setting up a reversal...then the Dow fell, crude came off its lows.  Wheat started back up and the sellers quit...the market rallied back closing near the highs...it was a typical weather market type trade without the weather.  So what we have now is a market that is going to become more and more difficult to trade as it will start swinging more and more.  Nothing new for us in the recommendations department.  We are long July and looking to take some off the table and use September options for a weather scare.  That could be next week or tomorrow...we'll have to be very careful in our roll and we will need to do it execute the roll back to back.  I'm not going to try and leg into this position. 

Another choice we have is to move all of our July 220 calls up to 240 calls and take some of the money off the table that way.  There is a good chance we may exercise some of these calls too.   

Read our Weather Market comments we wrote last year...they still apply.  The gist for this discussion is if you trade, especially roll, try to do it mid-day not at the open and not at the close. 

And so...it begins!!! 

Soybeans - If I had to trade this it would be in Soybean Oil not the beans.  In fact a long oil short bean spread is not out of the question but long oil short meal makes the most sense.  In general, I'm not to pumped about trading the complex at all right now. 

Wheat - No sign of a top and today's move was huge as it sold off and then turned right back up.  Hang on here but start putting your finger on the trigger.  We are long the crop not the futures and ready to pounce.

Rice - Slowly it goes.  We still see the market higher but don't want to add right now.  We are long right at 60% and that's good enough for now.  We would buy breaks and there will be some but the question is from what level.

Natural Gas -  Market tried to rally early but couldn't and ended with a key reversal down; however, it is a continuation signal pointing to the market low.  Not that it make a low soon it just says, we aren't finished.  When you see this signal in a market like this, it usually occurs before a major low.  Now that doesn't mean we will not go another $1.00 lower because we certainly might.  It just means, we maybe closing in on a time period where a major low is going to occur.   

Cattle -  Cattle rallied and actually closed right at unchanged to just a bit higher.  We are not in any hurry with as we sit on nice profits and will let the winner run since we have a target near $80.00.  Cash prices have firmed back up as well so the main pressure is off...for now!!!

DOW -  As I write this the market is down over 200 points.  Currently the market is showing a trend day lower with very little sign of support.  There has been no bounce to sell so there is no Kondratieff formation of a top.  We remain bearish here with the idea that the Fed is not through.  We called a 5.5 rate months ago and that is sure in the cards after the CPI index today.  We are long some Asian funds expecting the dollar to move even lower.  Under 80 on the index is a very real possibility.

Can panic hit this market right now?  Sure can but it is doubtful and if panic selling were to come in, I'd probably buy it.  For farmers, the move lower in the Dow and the Dollar is bullish but again, it won't go straight up and if panic did hit the security market, the funds, who are long corn, would probably be forced to exit some positions.  That would drive the price lower in the short run.  Again, I think the odds are slim but better have a plan just in case.     

Tuesday May16th- 2:00 PM - Short one tonight

Corn - Nothing new today...read last nights comments.  My work shows two more days right here and if the lows hold...we should move toward our target window of $2.65-$2.70.. 

Soybeans - Nothing new here.  No sign of a low yet!!

Wheat - Still moving higher...we will wait to sell for a good reason.

Rice - Nothing new...read last night's comments.

Natural Gas -  Up a bit today but crude fell apart late in the day.  Maybe more pressure tomorrow.

Cattle -  We remain long, liking a few days of consolidation.  $80.00 remains target.

DOW -  No change here.  Longer term lower near term...who knows and who cares!!!

Monday May15th- 2:00 PM

Corn - The market consolidated gains today in front of this afternoon's updates but then rallied in the last 30 minutes pointing to higher levels still.  We bought more today on the dip and now have hit our maximum level of 80% on the buy backs.  If July trades to $2.65 tomorrow, we will probably take a little off the table as we have been long for some time with an average well below 25 cents lower than today's close. 

What about today's reports???   Does it really matter???  Probably not.  Well...at least for corn.  Read our comments under Q&A on the corn.

In general, we remain friendly but there will be some ebb and flow.  The weather is about to change according to the calendar and the longer term weather forecasts.  Too wet of weather will stop the corn planting but it will take too dry of weather and a crop under pressure to move the market substantially higher.  For now, we look for the market to move toward the $2.65 level in July and then wait for weather but on breaks, you can expect plenty of good buying. 

Soybeans - Nothing new here.  We are not going to move higher until the crop has pressure on the yield side of the market.

Wheat - We still like the market and the lower move today is good since it will tell us where support is.  For now, we remain long but there is risk starting to show up on our radar...it's just not enough to make us worry.

Rice - Good follow through and now comes the resistance.  We are long until there is a reason to set aside some risk...right now I don't see much risk in this market.

Natural Gas -  Timing is going to be everything.  We all know the fundamentals...we also see the calendar on the wall.  Forecasts for a strong but not as bad as last year hurricane season will keep the buyers at bay but I doubt for long.  In the scheme of things...this year is still going to be a big one for hurricanes anyway you slice it and it will take only one...or the idea of one to setoff buying here even with the till completely full.  On that rally, it will be time to be a seller as the winter down turn could be a big one. 

Cattle -  We remain long here liking the chart pattern.  Pull backs are possible but another 3 to 4 cents up is likely.  We'll buy breaks.

DOW -  Let me say again, we think a major top could be in the works but there is no conclusive evidence.  Here is what we wrote Friday and it bears repeating...

"This could be the major top we have been talking about and if it is, here is what to look for...a Kondratieff top.  The market doesn't have to do it but it is sure prone to, given the technical trading in this market over the last 18 months.  What I am going to look for is a sell off from here followed by another rally that fails.  That is when I want to sell it.  Other wise I have to let the market breath from here down to 11,000."

The market reversed back up today so get ready for a test of a K-top!!!

Friday May12th- 3:00 PM   AND YES...WE ARE GRINNING FROM EAR TO EAR!!!

Corn - Big day up as it all starts coming together.  Can I say," I TOLD YOU SO?"  The USDA report was more bullish than my wildest ideas.  I though they would come in at 1.3 to 1.5 billion for a carry over number but I was braced for 1.6.  It came in at 1.14 billion bushels left over at the end of next year which was 130 million under the lowest guess.  But the real aspect of this report is not the carry over.  Yes that is the bottom line but the question has to be asked...where could the USDA be wrong?     

Two things really pop out of this report.  The first is the usage number of 11.6 billion bushels.  THINK ABOUT IT.  We are going to use 11.6 billion bushels and the ending stocks is estimated at 1.14.  That is less than 10% of the ending stocks.  I'll go out on the limb and say that there is little to no China exports in that number and there is little doubt in my mind that China is looking at corn to exchange dollar currency with.   That issue alone indicates we are sitting on a time bomb.  Something we have been saying for two years.  We knew it was coming...we told people and some even laughed at me!!   That's OK by me.  Fact is China is huge in the future of the grain markets.

The second big issue is the yield forecast.  149 bushels per acre.  What happens if they are wrong on this.  If we are down 5% from last year's yield which is my current idea, that is a reduction of 600 million bushels and all of a sudden we are at 500 million bushels left over...that would be $5.00 corn.  So here is the concept, THERE IS NO ROOM FOR A MISTAKE.

Some of my clients called today and asked if they should take a profit.  You can imagine my response.  "ARE YOU KIDDING???"  They were!!!  If there is any weather problem...if China buys more...if farmers lower their fertilizer amounts due to budget restraints...if ethanol demand is not 2.2 but 2.4 billion bushels...well, you can see...there is no room for a mistake.

If you sold out today like many wanted to, you might be ok as we could test today's lows at some point but then again...  Check Sunday night and if corn is 2 cents higher in the overnight trade...GET THE HECK BACK IN!!!

Soybeans - Where can the beans go with these fundamentals...the answer is nowhere UNLESS...there is a weather scare.  Beans can certainly get drug up by the corn but for now, I would like to buy options on a break next week.

Wheat - Nothing new for us...we like the market to work higher near term.  The report was bullish and wheat has some room to roam higher.

Rice - The report may have been neutral as we already knew there would be lower production.  Acres are down sharply and here too there is little room for a mistake.  We remain long and will hold those positions.  That is in the new crop.

Natural Gas -  The market broke into new lows today with a sharp move to downside.  For cash buyers who use natural gas, we bought in a little more today just to continue are scale down buying approach.  While I doubt this is a bear trap, I will start looking for that reality early next week.  From the chart formation, look for gas to test the $6.25 level in July and if that happens, I will be looking at the $8.00 call in Sept or October very hard.    

Cattle -  Market moved higher and broke through resistance setting up a move toward the $80 level in June.  We remain long as the double bottom seems to be confirmed.

DOW -  PB sets at 51.8% tonight which very close to a major sell signal.  Look at the dollar...this is what we have been looking for and saying would happen and it is in just after the Fed raised rates again setting up the 10 year bond moving into new lows.  We do not like the Dow and today's sell off is not a good sign.  If we are down sharply on Monday we will have sell signals for sure.   The bad news for us is that the real sell signal is really down at 11,000.  That is 300 point lower than tonight's close.  So lets talk...

This could be the major top we have been talking about and if it is here is what to look for...a Kondratieff top.  The market doesn't have to do it but it is sure prone to, given the technical trading in this market over the last 18 months.  What I am going to look for is a sell off from here followed by another rally that fails.  That is when I want to sell it.  Other wise I have to let the market breath from here down to 11,000. 

Friday May 12th - 8:00 AM   USDA REPORT - BULLISH

Corn - The ending stocks of 1.1 billion is below any trade guess by 150 million bushels.  Look for corn to try and buy some acres no matter what s  I expect a sharply higher open here but can't give you a firm call just yet.   

Soybeans - In the range but below estimates...with the higher fuel use for Bio-diesel and a weather market ahead, beans should open higher as well. 

Rice - Confirming no new acres the USDA increase average yield by 300 pounds...sure...right!!!  Market should be higher as well.  If we average last years yield, the carryover drops to 9 million in the long grain...nothing bearish here.

Wheat - No real surprise but the market will not be down given the other markers...

Comment- The close is more important than the open...Let's see how it closes.

Thursday May 11th - 2:00 PM   USDA REPORT HERE TOMORROW MORNING

Corn - WOW!!!  Not expecting this today at all.  A strong day up probably on short covering in front of the May numbers.  Tomorrow's USDA report will be important but lets be honest, if there is going to be a surprise, it will be bullish not bearish.  On the downside this is the wrong time of year to free fall with the current demand picture and growing season ahead.  We'll have an update on the report tomorrow morning at 8:00 AM. 

General Comment - No reason to comment on beans wheat or rice tonight.  We'll look at the report numbers and then do an in-depth analysis.

Cattle - Nice move higher today, double bottom looking good...we are long with a stop under the lows.

Natural Gas - Higher infusion than was expected and that only has more people worried about inventory space.  At some point we are going to fill up and then what do we do?  At the same time, hurricane season is right around the corner.  We will play a timing game and buy this market lower looking for a summer bounce and then once September and October are behind us...look out below. 

Dow - Big day down as I write this...fact is the Fed ain't through.  We still are of the mind they will over correct to 5.5 on the fed fund rate and a recession will be in the works for next year.

Wednesday May10th- 10:00 PM  

Corn - We are still long as we head into the report this Friday.  The rally today was mostly a lack of selling not aggressive buying but the point is that selling must continue or the natural direction of this market will be higher.  We moved some positions to September today but are going to remain 70% long through the report.  Our positions are profitable and unless there is a huge surprise in acres, look for the a carry over number around 1.6 billion bushels for next year.  Now think about this.  1.6 billion while we use almost 11.0 billion.  There is no room for a mistake.  Every 5 bushels off of the trend line yield will be 350,000 bushels.  This is why the risk is not down in corn.

BY the way, the average yield set out Friday morning by the USDA is going to be very important to watch.  Will corn farmers put out as much fertilizer as they have in the past to keep those yield extremely high.  Economics 101...Marginal cost versus marginal revenue.  So the answer is...I doubt it!!!

Soybeans - It will take a weather problem to get August beans over $6.50.  I am not willing to sell here yet especially this early in the season.

Wheat - I am trying to get my head on straight for a sale here.  I remain bullish and think there is more upside; however, this report on Friday will be huge.  I'm waiting for number before doing anything.

Rice - Nice up day but on small volume.  Lack of sellers is important here because no one want to press the market before this report.  We remain long wanting to own more on breaks.

Natural Gas -  Market quiet in front of Thursday's report.  This is going to be interesting as the supply fundamentals and the geo-world events continue to collide.

Cattle -  Same comments as last night.  The double bottom remains in tact but buying is not strong enough to override sellers who remain very active at higher prices. 

DOW -  Nothing here...No reason to sell it yet!!

Tuesday May 9th - 5:00 PM

Corn - No changes from last night.  We could still see another sell off here for 5 to 10 cents.  At the same time, we are setup to move higher with demand and weather premium which is not in the market at all.

Soybeans - Market sold off of highs today but finished up.  We are not that bullish to beans but do not want to sell it.  Look for another test of today's high to see if the selling was for real.

Wheat - The market is proving itself to the upside and we have no reason to sell it. 

Rice - WMP - Unchanged (Again).  Up a little in futures but nothing definitive.  We'll stay right where we are looking for new crop to work higher in the long term.

Natural Gas -  Read last night.  Nothing new here even with crude strong. 

Cattle -   Market is consolidating and that is not good news for June cattle futures.  We will move to August and maintain a long position for now but we are nervous.

DOW -  Still going and could run through all time highs.  No reason to short this one yet but the time is coming. 

Monday May 8th - 5:00 PM - with a Special Request for Crude Oil

Corn - As we said yesterday, the charts are pointing lower but for the first time we are starting to see dry weather forecasts coming into view.  Notice the 6-10 day weather forecast and while there look at the 10-14 day forecast.  This pattern is has been showing up for the past three or four days which indicates a dryer yet cooler time ahead.  If the heat then sets in without a change in rainfall, things could get interesting.  We still see a scare and that will be very important to us on the sell side.  Near term, the market could break down to the trend line at $2.32 in the July.  I would look for that level to hold for now.

Soybeans - A weather scare here would be volatile but it will take a weather problem to get the market moving sharply higher.  The spigot needs to be turned off for about three weeks to set that up and while the longer term forecasts seem to indicate dryer weather, with no heat there is little chance of major damage.  Longer term we want to sell beans but not here and not now.  PB is at 60% so its setup for higher levels and the real question is what does this Friday's S&D report look like.   

Wheat - Tried to go lower but couldn't.  We still like it and think we will work higher near term.

Rice - Old crop is weighing big time on the market.  I look for the market to possibly consolidate here but it doesn't have to.  The S&D report this week will have some impact on this market as well.  We could still take old crop another 20 cents lower but new crop is going to start calling for storage from the old crop.  We want to own more at lower levels but will give it some room.

Natural Gas -  Market still in bearish stance but the lows are supporting here.  We hope to buy more on another break.  The fundamentals remain extremely bearish but the geo-factors are scaring the bears from really sinking their claws into this one. 

Cattle -   The double bottom remains intact and we are still long here.  We need to push higher tomorrow or we could sit right back down and test the lows.  PB is now positive and today's close is back over the 21 day Moving Average.  We could go sideways here for a while as well so this long position is not one that we have extreme confidence in just yet.

DOW -  Market made new highs and consolidated.  That is accepting value but it looks like some of the bulls are pretty nervous.  They should be, I give the government a 20% chance of pulling off a soft bottoming action with interest rate changes. 

SPECIAL REQUEST... - Crude Oil

July Crude today sit down on its 9 week moving average and didn't like being there.  It rallied $1.40 off of the lows.  It still closed lower and still may work on down toward the $70.00 level but I doubt it is going to break really big from here.  PB has gone negative at 46% but that is exactly what you would expect on a day where the low was so far from the previous close and then still closed lower on the day.  Never mind it came back because the negative close puts the day in the negative column.  The question here is where can it going?  I know that is a stupid question but the fact remains the Geo-atmosphere is not conducive to a major correction in crude oil.  By major I'm talking about below $60 a barrel.  We could break to the $65.00 level but things have to just perfect for that to happen.  If you are a user of product, then you have to buy a break especially if we can get PB below 33%.  For now, we would let the market prove that it can sell off and hold the test of the 9 week moving average.  This is going to be a very hard trade for the next several months.  Also, with the first hurricane in the gulf...look out!!!

Sunday May 7th - 4:00 PM

Corn - The long term trend remains up but the short term trend is absolutely pointing down.  PB went negative last week and the gap was filled.  On Friday the COT report shows a huge long position by the funds and a very large short position by the specs.  Look for more downside pressure based on the charts.  There is no sign of help from the weather but it is still early.  We are moving all option positions to September now as we are inside 40 days till the July options expire. 

Soybeans - This market has moved higher on ideas of more corn acres being planted.  Time will tell but I doubt it is a significant change.  The fact remains that fertilizer prices are through the roof and this will be a very expensive crop.  That is a bigger factor than the weather allowing more acres to get planted.  Even so, the market is not wrong and right now it is saying there is less acres of beans than the March 31st report showed.  We will buy breaks using options.  There is no reason to sell with the market near loan levels.

Wheat - We are still on the long side here wanting to sell a big rally.  Weather remains on our side in that department. 

Rice - The march lows are holding but PB is under 40 and pointing lower.  There remains a bunch of old crop supplies and funds are not end users so their long positions are subject to be changed.  We still own this market but in the new crop and want to buy more on a break.

Natural Gas -  New lows in July sets up a move lower into June.  It will be interesting to see if that can materialize with all the other energy problems.  PB is 47 going into Monday's trade and we are working off a hook reversal down.  Just remember, we are three weeks away from Hurricane season.  That will be a factor.  We will buy some "Hurricane Calls" very soon but I'll wait to see how we trade against the lows.

Cattle -   Triple  bottom anyone???   We are switching to August cattle and looking for the test of lows.  Frankly, I don't see the large supply of beef coming on line after we get through the current glut.  Cash is holding here and I think we are within sight of the lows for a summer rally. 

DOW -  We are 170 points from all time highs.  I still se market with a chance to make those new highs and then....well, I'm not bullish after that.  Near term the market may keep the upside momentum but if the Fed doesn't stop raising rates, we are going to start see the velocity of money slow and if that happens, I doubt the expansion can survive.  A major correction in the Dow is possible. 

Friday May 5th - 2:00 PM

Comment - We will go through the weekend and try and have more comments here on Sunday night. The action today didn't change our outlook in any of the markets so read below the comments of this past week and you will have our ideas d come back Sunday night or Monday morning for a full update as we go into trading for next weeks May 12th S&D report.   

Thursday May 4th - 4:00 PM

Corn - Market closed the gap today which was not what we really wanted to see.  The market is telling us more acres are being planted; however, it still is not going to be enough and this break is falling right into the hands of the big players.  We remain long corn with options and some futures but will probably lower our position back to 50% if the market remains in trouble tomorrow. 

Soybeans - Corn acres up bean acres down???  Not enough to help in the long-term and once acres are better known, we will want to be short here unless there is a weather problem developing.

Wheat - Nothing else.  We remain friendly here with the crop looking as bad as it does.  Break should be bought. 

Rice - We keep trying to go lower and maybe we can dip another 10 to 20 cents but in the long term, this market knows acres are down and good weather is not buying rice acres.

Natural Gas -  Up big again today which has us thinking a bear trap has formed.  We'll follow this market with closely as we are long 33% of our base position and will buy more if we get a good buy signal.

Cattle -   Double bottom remains in tact.  Tomorrow may be interesting.

DOW -  Dow up with crude in the tank but not by much.  We remain bearish longer term but we could inch higher near term.  I still think, "Sell May and go away" is going to work this year.

Wednesday May 3rd - 10:00 PM -  Read our comments from last few days as there is little change today...

Corn - More downside and in fact, PB went into the bearish camp today signaling a sideways trend is underway.  This could mean about a 20 cent range with $2.36 to $2.56 in the July.  On major break, the commodity funds are going to buy and on good rallies, commercials are going to sell.  There is no sign of weather problems so we are in for a wait and see of the USDA May 12th report.  It may be boring until then.

Soybeans - Nothing else here either.  Look for the market to wait on planting updates.  Longer term, if there is no weather problem, this market will work lower; however, I still see a scare at some point.  It may last a week but there will be something that concerns traders during the growing season.

Wheat - Nothing else.  We remain friendly here with the crop looking as bad as it does.  Break should be bought. 

Rice - Nothing here today.  Look for market to stay subdued for a bit longer.

Natural Gas -  I sound like a broken record...nothing here either.  Tomorrow could see more movement with the Gas inventory report. 

Cattle -   Market tried to go higher but couldn't so it tried to go lower but couldn't.  Sounds like the the market that couldn't.  Technically it still looks like a double bottom but there is no buying yet.  We remain long with stops in place several ticks below the lows

DOW -  Nothing here either...what a boring day!!!

Tuesday May 2nd -9:00 PM - 

Corn - A little more action than I expected today as the market sold off after the run up last week.  Tonight the market is up a bit but the pushing down on the futures.  I am trying to figure out this idea of plantings being ahead of normal being bearish.  If acres are lower, doesn't it make sense that the plantings will come in faster???   If I plan 1 acre I can do it faster than 100, right???  Bottom-line is that the speed of acres going in really doesn't make much sense; however, the long term forecasts are not bullish and that is a good reason not to buy the market.  Look for a test of support and that could still be 10 cents lower in the old crop July.  We will watch the July-Sept spread during the correction.  Also, the May 12th report will start to be a major factor. 

Soybeans - Market lower on weather and selling from the corn.  Doesn't mean much as we still don't think beans can rally much without a weather scare.  Where is that???  Nothing even close so far on the longer term forecasts. 

Wheat - Higher with the rest of the complex lower.  Look for more strength if there is no rain and soon.

Rice - Again, there wasn't much to talk about today.  WMP unchanged and the market overseas looks pretty slow.  I will buy breaks but there is no real reason to sell anything yet.

Natural Gas -  Nothing here today as the market waits for the report Thursday which is going to show more infusion of gas into storage.

Cattle -   Well, we were true to our word and bought cattle today.  It may be a mistake but we will not lose much with stops under the recent lows.  And no...the stop is not one tick below the low...that is suicide. 

DOW -  Up today but the slow down is still coming.  I look for the Fed to tighten again this next meeting but I will go out and say, they will probably raise the rate one more time.  They are playing a dangerous game but they are in a dangerous business.  If they don't raise the rate, they face inflation slowing the economy and sending us into a recession.  If they raise the rate too far, they will slow the housing market too much slowing money velocity and sending us into a recession.  What are the odds they don't do it one way or the other...I give it 20%.  In any event, the market is going to stall here or work lower.   

Monday May 1st - 4:00 PM - 

Comment - I didn't update the site on Friday or over the weekend as I updated software and computer applications.  Not that it will change anything here but it may sure make my life a little easier.

Corn - Nice rally on Friday followed by a mild hook reversal down today.  Friday's high was right up against major resistance and I think this level will hold until after we get the May 12th numbers from the USDA.  I look for a boring week here with little action and no sign of direction but demand is continuing to grow and as we have been saying for months, it will certainly be higher than the USDA forecast.  We will not buy any more here and will wait for a correction to own more.  Corn plantings are now at 52% with an average trade of 50% so there could be a little weakness in the trade early tomorrow but again we will trade demand longer term.

Soybeans - On Friday we broke out of the downward trend line but there was no new highs today as we finished with an inside day.  I like the action but in general it shifts us from a down trend to a sideways trend.  I see no reason to rush in here.  Yes, some corn acres are shifting back to beans but when it is all said and done, I doubt it will be that much.  We will buy a break here against long term support.

Wheat - The hard red winter wheat still needs rain and they aren't getting much.  A close over $3.70 tomorrow in July wheat (CBOT) sets up a buy signal. 

Rice - A quiet day but a higher one as well.  Not much to talk about here as we still find the market under valued and think it will move higher longer term.  We are not selling anything at this point for new crop and have gone back to 55% long on our buy back.  By the way, we are using 80% in the new crop and only 20% in the old crop on this position. 

Natural Gas -  Market moved higher but barely compared to crude oil.  Look for this to stay sideways near term.

Cattle -   Strong day today.  The futures is at a major discount to cash and it seems some buyers used some news from Tyson that they would not increase poultry supplies this summer to bring about the sharp move.  The double bottom is well intact and I will buy cattle tomorrow with the lows as a stop.

DOW -  Sideways at the top.  Looks like a distribution top which could take another 2 to 6 weeks to complete.  Don't like it here. 

Natural Gas - No change from last Friday....We still see the market as sideways.  This could continue for another 6 weeks and then the market accelerate into new lows; however, we are entering that time of year and traders may demand a premium for weather unheard of in gas futures.  I think they may already be demanding it.

Dow - If you are long here, you didn't like today.  We rallied big and then fell apart.  We stayed higher on the day but selling above 11,200 is very obvious.  The buyers look to be getting tired.  We are out looking for lower prices to be buyers.