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July 17, 2008
I know I keep pounding on this but experience has taught me how
quickly bull markets can collapse once they finally "flame out".
I think this is absolutely the case with Corn and the Soybean
complex. The flood is gone. The sun is out. There's plenty of
moisture in the ground, and the crops that DIDN'T get washed
away are growing full speed ahead...Rain Makes Grain...and as we
now start down the back stretch towards harvest, I believe there
is big, fast (maybe devastatingly so) potential on the short
side of these markets but think positions need to be established
immediately (look at what has already happened in wheat and
corn). Maybe I'm wrong, and if I am these are all money losing
ideas, but if I'm right I believe it will be very much so.
Give me a call...Put something on one or
both of these markets...Doesn't what is here make a lot of
sense?
I'm short, and adding every chance they give me...
Thanks,
Bill
866-578-1001
770-425-7241
Let's start with a look at how the Wheat sell off
developed...Again, I am using this example (and it is not the
only one by any means) to make the point that bull markets most
often end with that commodity slapped all over the media...I am
sure you had to catch some of the headlines and hair pulling
back in the spring when analysts everywhere were screaming the
world was going to run out of wheat...Well, we obviously did not
and wheat dropped 40% in price in less than three months, which
on a futures contract represents a lot of money, whatever the
commodity.
Anyway, this first chart is a close up look at how that decline
took place...This is not to say it has to happen at all the same
way with the Corn and Soybean markets (or even happen at all for
that matter) but I do think it is a very strong
possibility...And I can also add, virtually every Corn, Wheat or
Soybean bull market I've ever witnessed has pretty much ended by
going straighter and faster down than anybody could ever
imagine.
This chart only includes the period between Wheat's contract
high in early March and its low since then in late May. I have
noted all of the "up" days (higher closes) as the market was
rapidly sinking more than $5.00...
Here's a close up of what we have witnessed so far in Corn...
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