Well the cotton has been very good to us. Now we have to be vigilant for some topping action. The floods in Texas have wreaked some havoc on this crop, and demand has been good—so it appears we got out early. So, we made some and as they say: “You never have enough positions on for the big ones.” But at least we had some.



You might be of a mind to think about some long-term put strategies with the idea of a short pullback over the next few months. Those of you who have risk aversion, call about a put strangle.

Sugar

We are short sugar and just holding our own. A huge spike in gas and oil has allowed ethanol to spike up, and dragged sugar higher. I hope to see a dip in the unleaded price, which will allow us to enjoy a profit. Watch out for a brea out above the lip of the bubble. Ten cents would signal higher prices.

Cocoa

Like the cotton, we got out of this much too early. This pop really surprised me. I felt that we would hold the 2000 area, because if you go from Oct 2006 -2007 and lay out that year’s movement, the height of rally should have peaked at this point.

Weather has been a little dry in Africa and some cash market buyers have been in the market. I sold a few contracts against the measured move and right now am a net loser with stops above the market. Call in for updates.



OJ

Here is the multi-million dollar question. Is OJ at a bottom or is their more underneath this falling knife?



I still hold to the idea that OJ from the call side is a good trade.

Be aware that this is a swing for the fences and nothing else. A hurricane or a dry spell and you’re off to the races. This must be looked on as a very high-risk trade, as picking bottoms is something that is almost impossible to do with any long-term accuracy.

Lets’ talk coffee:



NYBOT places bagged coffee (certified stocks) at 1,832 or 4 million pound weight, and another 86,000 bags waiting to be certified. Man oh man, that is a lot of coffee! Now that is the bear news.

I think it is time to pause and think that we could still get some bad weather, and also remember that we tend to put in bottoms over the next 60 days. This is not a free trade; coffee will always be in demand. Let’s start a long-term watch for some bottoming action , with the idea that when fall shows its head, we are in a good position to enjoy the fruits of a nice sustained rally.

NEVER LET A WINNER BECOME A LOSER!