Prepared by Commodity Insight

Thus far, October has lived up to its billing as being one of the most bearish months of the year. Many feel that October is more bearish towards the equity markets than any other markets on the board. But I have stated several times that a more correct analysis of October is that it tends to be bearish for all markets.

For example, this month, not only have equity prices taken a hit but so have metals with gold dropping to a 12-year low on Friday. In addition, orange juice hit a 15-year low this month while coffee hit a three-month low, cocoa a two-month low, hogs a one-year low, cattle an eight-month low, lumber an 18-month low, copper a 10-month low and cotton an 18- month low. October, has been and is one of the most bearish months of the year.

Interestingly enough, the grains have done well this month considering it is October as well as harvest time. If grain prices can rise in face of what is taking place in the surrounding markets, what will happen if something unexpectedly bullish were to surface?

My bias is not to be short grains. Even in October.

All in all, it was a sloppy week for most of the other markets on the board. But that should not have been totally unexpected considering equities and metals collapsed this week along with some nasty breaks for nearly every other market being traded.

And to be honest, it is hard to say if the nervousness in the surrounding markets has finally run its course. But this I do know: October still has a few days to go before it is history. Long positions in any market therefore, are still vulnerable to a hard hit.

I see nothing to do in the other markets for another week or so.

October 26, 1997Jerry F. Welch, Publisher

Commodity Insight

152 Ennis Lake Road, Ennis, Montana

Added to the WWW 10-31-97
Last updated on 11-03-97

Hosted by:
One Crossroads Place
610 West Maple Ave, Suite WWW
Independence, MO 64050
(816) 252-4080
sysop@kcmo.com

wmeubank@ocp.kcmo.com