*RISK DISCLOSURE: FUTURES AND OPTIONS INVOLVES SUBSTANTIAL RISK OF LOSS, AND IS NOT SUITABLE FOR ALL INVESTORS. ONLY RISK CAPITAL SHOULD BE USED. MARGINS ARE SUBJECT TO CHANGE. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. AN INVESTOR COULD POTENTIALLY LOSE MORE THAN ORIGINALLY INVESTED.*

08/21/08<< COCOA>> Just as expected the dollar has pulled back and cocoa prices skyrocketed today amid a falling dollar and news out of the Ivory Coast of a spreading pod disease that could hurt available supplies. The fear of tighter supplies brings buyers into the market. It is still my opinion that last Friday's low, the May/June low, will hold as near term support, but that ultimately the strength in the dollar, adequate available supplies in the market and no massive increases in demand will create a larger longer term selloff in the market to the march/april lows around 2250-2300   Strictly technical I am looking at 2950 as R1 and 3050 as R2. In my opinion a close above 3050 would need a major fundamental driving factor to sustain that price level.

08/21/08 SUGAR Today with higher crude prices we have seen buyers come into the sugar market. it also helps to see this pullback in the dollar. Sugar is traded in US dollars so as the dollar moves lower it will take more dollars to buy this commodity. Long term fundamentals still suggest that prices can move higher and you can see this as the March 09 contract is really pushing for new highs on the year. As outside markets like the dollar and crude play an important role, it should be noted that the fundamental outlook is that demand will be increasing and that supplies may indeed dry up. strictly technical a close above 1400 in the october contract(old resistance) should become the new support level for fresh buyers entering positions.

LOOKING AHEAD WITH THE US DOLLAR INDEX>>> In trading commodities, currencies, stock indices, or bonds you should definately be aware that there is a lot of information on the docket for next week. Tuesday 08/26/08 we have Consumer Confidence, New Home Sales and the Fed Minutes which should have an enormous impact on the prices we trade. Thursday 08/28/08 is prelimGDP and Claims. I would strongly suggest to watch the dollar for commodity movement. The following week is a shortened trading week with Labor Day. Looking even further out to Thursday 09/04/08 we have ECB and BOE interest rate decisions. Many traders attribute the rally in the dollar to the fact that both economies are contracting and that to stimulate growth they may cut interest rates. If rates are cut, we may see more selling pressure across the board in commodities and a continued rally in the dollar. *RISK DISCLOSURE: FUTURES AND OPTIONS INVOLVES SUBSTANTIAL RISK OF LOSS, AND IS NOT SUITABLE FOR ALL INVESTORS. ONLY RISK CAPITAL SHOULD BE USED. MARGINS ARE SUBJECT TO CHANGE. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. AN INVESTOR COULD POTENTIALLY LOSE MORE THAN ORIGINALLY INVESTED.* CHARTS BELOW COURTESY OF BARCHART.COM