Re: long wheat, short corn (no mo)

["Walter Lake" <wlake@xxxxxxxxx>]

Hi Steve

This appeared on one of the end-of-day wheat reports

"... Kansas City: ... I've talked before about Dreyfus and their selling
this past week. They have sold around 2,000 contracts over the past week,
and they stopped something like 2,000 May wheat during this last delivery
cycle. They rolled a 6,000 contract long position from the March. Do they
have another 2,000 contracts to liquidate? Tough to say. Bottom line - the
biggest long in this market is getting out of their positions. ..."

It's an indication of choppy fund action that I see on the pit reports.
Several funds can account for major portions of the action in any of the
markets. Unfortunately if you're going short, the Commercials (Users) are
right there on any dip with lots of outright buy and scale down buy paper.
There appears to be a lot of paper sitting waiting for the "right price" <G>

Best regards

Walter


----- Original Message -----
From: "Steve Karnish" <kernish@xxxxxxxxxxxx>
To: <metastock@xxxxxxxxxxxxx>
Sent: Wednesday, May 17, 2000 10:25 PM
Subject: Re: long wheat, short corn (no mo)


| Walter,
|
| It's always fun to catch a top.  Momentum oscillators can be stunningly
| accurate or incredibly early and therefore, very frustrating.  There was a
| time, early in this trade, that the funds were long 80,000 corn and still
| short 10,000 wheat. At the time, I thought that maybe the funds were about
| at their risk capacity (for exposure to one single commodity).  Sometimes
| the fund movement reminds me of "bullish consensus":  If 90% of the people
| surveyed say that corn is going up, no one is left to buy.  If the funds
| already own 80,000 - 90,000 contracts (I think a record for corn), chances
| are (and here is where this "thinking part" gets dangerous) that they will
| liquidate, instead of build a larger position.  Whatever is going on, the
| momentum oscillator is diving south again.  The Bollinger Momentum
| Oscillator ("BB Thingy") provided two days to sell into it's overbought
| condition.  The funds are clumsy pests that cough up "chucks" of supply
and
| demand.  Sometimes, you can get "slobbered" on even standing on the edge
of
| the action.  It's always a thrill to witness the "group power" when they
| unwind a position.  How about this one: we're spread:  short wheat/long
| oats.  This not a spread position ... but, the outright mechanical
approach
| has created the artificial spread.  At least it's working.
|
| Take care...always fun(z),
|
| Steve Karnish
| Cedar Creek Trading
| http://www.cedarcreektrading.com
|
|
| ----- Original Message -----
| From: Walter Lake <wlake@xxxxxxxxx>
| To: <metastock@xxxxxxxxxxxxx>
| Sent: Wednesday, May 17, 2000 4:50 PM
| Subject: Re: long wheat, short corn (no mo)