Prepared by Commodity Insight

My work strongly suggests that aggressive grain traders and producers can buy just about anything on Chicago Board of Trade this coming Monday morning. Long positions established on Monday in corn, wheat, soybeans, oats or meal are low in risk and high in probability.

Only soybean oil appears to hold risk a bit higher than I am comfortable with for Monday's trade. The soybean oil market should not be probed from the long side on Monday. Further weakness, may take place for that commodity before week's end. But the rest of the grain complex offers a low risk buying opportunity for aggressive traders and producers early Monday morning.

Keep in mind that my work in the grain complex has not been all that accurate since early October. Maybe the grains are actually a sale on Monday's opening and not a buy. But here is what my work suggests for Monday: Just about anything on the Chicago Board of Trade can be bought early Monday. But not soybean oil.

Sugar prices fell to a one-month low on Thursday of this week while cocoa prices hit a three-month low. And petroleum prices collapsed this week as well with crude oil falling back to levels last seen over a year ago. This past week was not the best of weeks for most markets on the board.

But then again that is why the CRB and the Goldman Sachs indexes dropped hard while bond prices soared. The other markets on the board are doing no better than gold or grains. The point here is this: the bears have been in control of most markets since early October, and thus far nothing has surfaced to suggest that such a scenario is about to end.

November 23, 1997Jerry F. Welch, Publisher

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