This is an almost exact reprint of my newsletter from last week…with the only differences being that Soybeans are now 48 cents lower ($2400 per futures contract)…and that I have provided an update as to the put options I am recommending at current levels. And if you haven’t already done so, I urge you to take a good look at the histories here…of how EVERY Soybean top for the past 25 years has unfolded…
I can tell you that although the market has moved, it is NOT too late to get on this…and in fact, we were adding to our short positions this morning…Today’s action, down about 30 cents, is precisely the sort of one day START to the move that I have been anticipating…the sort of day that jolts a lot of nervous farmers, who had been hoping for higher prices, NOT lower, into finally beginning to sell the billions of bushels that they own…which drives prices lower…which begets MORE selling…and which then begets lower prices…etc…
The point is, I think this market is still JUST BEGINNING a move that will take it relatively straight down to UNDER $10.00 within the next few months. So again, it is NOT too late to be taking this position.
October 12, 2021 (Originally posted October 7th)
October 7, 2021
Soybeans ARE about to surprise the crowd...with how sharply and quickly they can go down…
But this IS nothing new…they’ve been doing the same thing for decades.
Why do I think that this…
…is IMMEDIATELY about to do something like this?
Because that’s the way it has more or less happened in every one of the last 10 bull market tops in Soybeans…Where they LITERALLY, from one day to the next, after meandering around…quietly doing nothing….just CRACKED WIDE OPEN and WENT RELATIVELY STRAIGHT DOWN…just about EVERY SINGLE TIME GOING BACK 25 YEARS...REALLY.
See for yourself… What follows are charts of the last 10 bull markets in Soybeans…How they went up…AND MORE IMPORTANTLY, HOW THEY ENDED. And let me be clear here…THEY ALL ENDED AND WENT SHARPLY LOWER…and believe me, NONE of them collapsed with the usual herd of forever-backward-viewing analysts predicting their demise…They ALL more or less rolled off a cliff with all those guys STILL touting the supposedly “bullish fundamentals.”
I also have to point out that they DON’T begin the collapse with some report or event that rings a bell and says, “Okay everybody. Time to go short.” NEVER. EVER…All of a sudden, they just start, and as I’ve noted on some of the charts, they often do so with one big day, or two, that kind of leaves behind a whole bunch of people who had been THINKING about selling…which is precisely why I keep banging away on this…why I keep screaming, “Get on it now,” BEFORE it starts doing what you’ll see it has done in 10 out of these last 10 tops in Soybeans.
Starting with the most recent top, in 2018, and going back in time…And be sure to note the percentage decline in each case…with none being less than 20%.
And you’ll see the same thing over and over below…That Soybean bull markets all seem to end the same way…And part of the process IS just going nowhere, drifting or bouncing hard up and down, but at some point…and again, it is NOT generally due to some notable news event or report…the selling begins “in earnest” and they just go non-stop in the crapper…And no, this doesn’t mean that it will happen this time, but that IS the bet I am making…RIGHT HERE. RIGHT NOW.
And one more time…Do take note that the smallest decline was 20%...Which, in today’s wild ass volatile markets, LEADS ME TO BELIEVE THAT IF AM RIGHT ABOUT THIS SELL OFF,IT WILL MINIMALLY BE IN THE 25-30% RANGE.
Here’s the current market again…October 12th…and what I am immediately recommending…
I might be dead, dead, dead wrong…and if I am you will probably lose money…BUT I THINK THIS IS A MONSTER TRADE AND I TRULY WISH YOU GUYS ON THE SIDELINES WOULD WAKE UP AND SEE IT…Put SOMETHING on the table and forget it until year end.
Soybeans have been building this top for about 6 months…but I think WE ARE DONE WITH SIDEWAYS…This, I believe is 150% here and now…and am personally all over this and DO see Soybeans UNDER $10.00 and DO think we will see it before we get to New Year’s Day…
If you are a farmer…of Corn, Wheat, Soybeans or Cotton…
And IF YOU ARE A FARMER SITTING ON CROPS, AND FOR TAX REASONS ARE WAITING FOR JANUARY 1ST, I STRONGLY RECOMMEND YOU EITHER GO AHEAD AND MARKET TO YOUR ELEVATOR OR BUY PUTS IN FUTURES…Let’s get real…You KNOW that every producer out there is waiting with the same thing in mind…So guess what? Do you really think, aside from the simple fact of harvest pressure, do you really think that with everybody like yourself waiting to sell in January, that prices are going to be better then than they are now? When does that happen? When does the farmer get that break from the commercials that buy your crop? Maybe I’m dead wrong, but I would guess that the answer is, “just about never.” And I’ll say it again…ALL you’ve heard from “expert” advisers, for months on end, is, “Hang on. Prices will go back up,” which definitely has NOT happened, and I think, probably WON’T. So, if you have selling to do, my advice is to get it done now…And if you don’t want the revenue in 2021, BUY SOME PUTS TO COVER WHAT YOU WILL BE SELLING IN JANUARY.
Call me if you want to know more…
All option prices in this newsletter include all fees and commissions. All charts, unless otherwise noted, are by Aspen Graphics and CRB.
The author of this piece currently trades for his own account and has a financial interest in the following derivative products mentioned within: Soybeans