wmeubank@ocp.kcmo.com
THE ALLENDALE ADVISORY REPORT
Prepared by Allendale, Inc.
Commodity Wrap-Up For December 12, 1997
Four major factors hit the grains this week. Four major reasons for a sell off: Futures continued to act poorly despite strong exports. This leaves the speculators holding a long positions that are not working. Secondly, the USDA released a bearish S/D report and farmers normally pick up sales after January 1 causing an even greater supply. Third, every sector, including the ag sector, is getting the Asian flew. We reported earlier this week that the economic situation was worsening because of industrial commodities were beginning to downward spiral. A deflationary environment is not good for commodity traders. Thus we sold the grains, thinking that even the USDA could do nothing to hold futures higher this week. For the week, March corn fell 6 cents, January beans fell 13 cents and March wheat fell 16.25 cents.
Odds For Next Week
Corn has an 86% chance of an 8.6-cent rally next week and a 14% chance of a 2.8-cent sell off. Beans have a 55% chance of 9- cent rally and 45% chance of a 7-cent decline. Wheat has a 70% chance of a 10-cent rally and a 30% chance of a 16-cent slide. For more odds, call us.
Bill Biedermann
Seasonal
Well you can put this one on Monday, December 15th. Buy 1 April live cattle/sell 1 April feeder cattle on Monday morning. Exit the trade on April 1, 1998 or at $1500 profit, whichever comes first. Over the past 15 years the probability of profit is 100%. The average profit in profitable years is $1198. Probability of loss over the past 15 years is zero.
Dan Darst
December 12, 1997Allendale, Inc.
4506 Prime Parkway, McHenry, Illinois
Hosted by:
One Crossroads Place
610 West Maple Ave, Suite WWW
Independence, MO 64050
(816) 252-4080
sysop@kcmo.com