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COMMODITY REVIEW AND OUTLOOK
195 Route 6A, Suite 6, Orleans, Massachusetts
(September 24, 1997) SOYBEANS: The monthly crush figures were bearish, suggesting slower bean usage for the near term. Also bearish is good harvest weather. While bean stocks are still tight, it will be difficult for the market to stage much more than minor rallies at this time. Rain may rally the market, but unless widespread and long term, 40 days and nights for example, should be viewed as a selling opportunity. Seasonals strongly suggest lower prices. In 14 out of the last 15 years, November beans have declined into the first week of October.
RESISTANCE–Resistance remains near 636, 644-642, (current levels) 652-655, 662-665, and near 680.
SUPPORT–Support basis November beans remains near 630, 625, 618-620, 610, 605, 597-594 and near 585.
RECOMMENDATION–Aggressive traders should continue to sell November beans on 5-10 cent rallies or in the upper 630's, lower 640's with stops of 5-10 cents or over 652. Objective is 625, although a test of the low 600's is very possible. Bearish option traders should consider 650 or 625 puts if aggressive and nimble. While March oil and meal remain strong buys on pullbacks, I would remain patiently awaiting a buying opportunity. Those long oil or meal should tighten stops, and consider taking profits. Conservative traders should stay on the sidelines for now.
M. Steven Morgan
Added to the WWW 09-26-97
Last updated on 09-28-97
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