Commentary for week of 10/06 November Soybeans

Soybeans and corn were victims of Wall Street, prompting further liquidation by funds. I do not think the  crop report will do much to change the picture, except if it is really a surprise. Frost this weekend if damaging could be helpful to the bulls, but what is said about the general economic outlook will be more  important going forward. If world economies slow down, the need for feed will come down and further liquidation from funds will continue. End users will be in more of a hand to mouth buying mode instead of  hedging future needs. If you look at all the charts in this TIF report, you will see extremely oversold conditions (for days now) that will make it hard for me to sell except when a correction occurs. As far as  buying, yes I would, but only with a known risk strategy and a price that I will feel is a “fire sale”. 

I bought against the $9.60 level Thursday buying November $10.50 calls for 26 cents looking to sell them  on a corrective rally or spread them off and take them into the report depending on the setup. On Friday when the market went ½ way up to the resistance and stalled for more than 30 minutes, I sold at 30  cents.

The steep downtrend is where the battle lies in the near term. My target of $9.60 looks more likely to be  seen. $2 break since the high on Monday indicates a maximum oversold condition. Fresh lines are made with new lows Friday.

****************************************************************************
****************************************************************************
Like what you're reading? Get a One Month Trial Subscription to CRB's Trends in Futures!

35 YEARS OF "REAL" TRADING EXPERIENCE, "NO-HYPE" APPROACH Emailed each weekend, you'll receive the full Trends in Futures Newsletter, with Howard Tyllas' insightful market commentary on numerous markets for that week, and what to watch for the coming week. Howard covers grains, energies, metals, currencies, softs, stock indexes, and more in this weekly newsletter.

PLUS! Get TIF Daily Numbers and Trade Recommendations! Howard's daily numbers and trade recommendations go beyond "this is the trade". What places this service on a higher level is the fact that Howard makes it a learning experience.

Trends in Futures is designed to help you plan your trading strategies for the coming week.

Sign up today!
****************************************************************************
****************************************************************************
Trends in Futures, a weekly publication since 1991

Copyright © 1934-2007 Commodity Research Bureau, a Barchart.com, Inc. company. All rights reserved. 330 South Wells Street, Suite 612, Chicago, Illinois 60606-7110 USA • 800.621.5271 or 312.554.8456 • E-mail: info@crbtrader.com • Website: www.crbtrader.com. The information herein is compiled from public sources believed to be reliable but is not guaranteed as to its accuracy or completeness. No responsibility is assumed for the use of this material and no express or implied warranties are made. Nothing contained herein shall be construed as an offer to buy/sell, or as a solicitation to buy/sell, any security, commodity or derivatives instrument. CFTC regulation 4.41 requires the following disclaimer:

HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT , THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM. ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCES RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELEY AFFECT ACTUAL TRADING RESULTS.