THIS PUBLICATION CONTAINS THE VIEW AND OPINIONS OF THE AUTHOR, EXCEPT WHERE OPINIONS ARE ATTRIBUTED TO OTHER SOURCES. WRITTEN PERMISSION IS. REQUIRED PRIOR TO ANY DISTRIBUTION OR REPRODUCTION. FUTURES TRADING IS RISKY AND CAN CAUSE SUBSTANTIAL FINANCIAL LOSS. THE USE OF OPTIONS AND OPTION TRADING INVOLVES A HIGH DEGREE OF RISK. THE USE OF STOPS MAY NOT LIMIT LOSSES TO INTENDED AMOUNTS. SPREAD POSITIONS MAY NOT BE LESS RISKY THAN OUTRIGHT FUTURES POSITIONS. PAST RESULTS ARE NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. SOURCES ARE BELIEVED TO BE RELIABLE BUT NO ASSURANCE IS MADE FOR ACCURACY. ADDITIONAL RISK DISCLOSURE IS AVAILABLE.

BI-WEEKLY COMMODITY OUTLOOK

10/27/96 6:25:34 PM

"The point is not so much to buy as cheap as possible or go short at top prices, but to buy or sell at the right time" ------ Jesse Livermore.

Last Friday we witnessed an `outside day up' in the DEC Bonds. Rules

For today early support is near 110-22 with more at 110-13. Resistance will appear near 111-19/22 With more at 111-28. There are no Gov't reports due out today, however G.D.P and home sales are due out on Wed.

If the DEC Bonds Hold the 111-00 and work over 111-06 a test of 111-27 in my opinion is likely. In addition one can expect a test of the 112-23 level this week in DEC Bonds if the momentum carries.

The Gold market is like watching "paint dry."

We remain friendly and would accumulate long positions if the DEC gold can maintain closes over the near or above 383.60 level this week. If DEC gold closes over 385 on Friday of this week expect some shorts to run..... We would only buy Next years Futures Contracts or Options.

DEC Silver should test 512/517 shortly. Support remains near 483/486 where we would buy dips this week. For Monday/ Tues. Holding over 492 is bullish

The Currencies had a rather active week, rumors about Russia, Yelsin's health ect.....The D-Mark was firm all week and we expect that trend to continue for at least another two/three weeks.

However one should buy minor setbacks from higher levels. For Monday support is near 6573 and again near 6540/45. Where we would buy for bounce risking only 20 pts. Resistance and target for the near term is near 6643/56651 and again near 6670/6687. The DEC Swiss Franc was rather sloppy on Thursday and Friday...

We are currently friendly to the DEC SWISS and would like to maintain a long posture with stops under 7857 or a close under 7880. Our target is first the 8130 area then the 8260 region. For Monday support is near 7909/7920 where we would buy for a low risk trade.

Nearby Support is at 7939/ 7954. Resistance will raise it's head near 8009/8020.

The DEC British pound has met our objective set a while back when the Bpz was trading 154ish. We now would be highly tempted to be out of longs, waiting for a pullback to the 15690/156760 region to rebuy....

Did you know the YEN has not been up two day in a row the last 17 sessions.That is what is called a bear market. The contract low was set Friday. The "weekend Rule" was in effect.

Support for Monday is near 8856. Resistance is near 8904 where we would sell an early rally if given the chance. Risk a trade over 8940.

A STAR PERFORMER last week was Copper. The DEC contract rose to levels not seen for quite a while.

The target for this week is a rally to the 100.80 level. Buy Dips into the 9460 region if given the chance. Risk three day close under 9220 for now.

For Monday, early support is near 9665 and again at 9620 where we would buy for a bounce risking only 50 pts. Resistance is near 9780 and again at 9860.

We have been Friendly on DEC copper for a while now and urge caution. However the shorts are the ones feeling the pain.. He that sells what isn't hisn

Must buy it back or go to prisn

Speaking of shorts running... .

Coffee was a good example....

In my last Bi Weekly - Commodity Report , http://www.futurescom.com ,

We gave coffee a strong Buy and our near term targets were nearly met earlier than expected. DEC Coffee's high last week was 122.50 close to our target of 124/126.

We remain friendly and suggest buys along the 110/113 region early in the week.

For Monday a Dip into the 11300/11340 region offers some support for a bounce More Support will appear near the 10960/11030 region.

Holding over 115.60 early Monday is bullish for a pop into towards 118Resistance is forming in the 11830 area with more at 11920/12030

Jan Orange Juice reached down into the 9900 region last week.The time is nearing for a turn in the OJ.

106 offers resistance and support is near the 9850/9950 region.

We would like to be long into the winter for now , however we would only carry small positions until further strength is evident. A close over 104.20 on the week turns the charts mildly bullish .

DEC Cotton was up four of five days last week. Bear mkt do not do that. For now if long maintain for a rally into the 7400/7500 region. We would like to buy Dips early this week into the 7180 region.

A close over 7300 augurs for a push into 7390 area where we would take partial profitsA three day close under 7080 is negative and we would throw in the Towel ......

We are not be averse to selling a rally into the 7415/7500 for a minor short reaction if given the chance. Use a stop over 7550 .

We are friendly toward DEC Live Cattle . We would Buy any dip into the 6490 region using the same three day stop under 6462 for now.

Targets for this week are in the 6677/82 region .

The Live hogs had a rather ugly week. however closes over 5270 will cause some short covering for a pop to the 5417 Region where shorts can be assumed. We were bearish at he Beginning of the month when DEC Live Hogs were 5700/5800 . We do not feel shorts at 5200 are safe , let it rally......

In fact we would buy a dip into the 5230 region Monday with a 40 pt stop looking for a bounce up to 5330 by wed. Seasonally speaking DEC hogs make bottoms this time of the year and notwithstanding low corn prices we would prefer to buy Dips for now.

We feel the same about Bellies , we were bearish at 7900 and above , 7600 and above and would not sell into the hole.. Bellies are going to bounce in my opinion. look for a rally to 7075 up to 7130 to sell early in the week. for Monday 6617 offers support where we would buy for a bounce with a 150 pt stop.Resistance remains at 6917 a close over 6900 augers for a test of the 7100 area .

Wheat had an interesting move down to 381 on Friday which was a low for the year , the contract low of 363 was made in 1995 ....however DEC WHEAT closed higher on Friday , that alone should cause some early buying this week. buy a dip into the b 384 region if given the chance..... Use a stop under 377 for now.

DEC Wheat has resistance near the 394/396 and again at 407 where we would sell for a turn this week.

The Corn is weak and is having trouble holding gains Support for the week is near 266/268 resistance is firm at 282. Enough said ......

Beans however went through a bout of short covering and firmed up to the 700 level on Friday A test of 723 is not out of the question for this week. We would sell that rally .

However our focus must now be on Jan Beans , which we will take a look at during the week in a Special Focus for the bean traders.

Nov Beans have support on Monday near the 696 region and resistance near 709 , take Either side for a turn with a small risk, 7/9 cents.

DEC Crude closed lower on the week, but up on the Day. We still remain friendly towards the Crude and products and continue to advocate buying of dips.

DEC Crude has support Monday near 2454/2449 buy there with stop under 2390 for the week. Resistance is forming near 2520 and 2558. If long take profits there on some positions......

DEC Heat has support near the 6890 region where we would buy for the pull into the winter.Resistance remains at 7335.

Try to be long Heat as we go into the Cold season....

The Stock market under went some profit taking and short selling late last week.However we would not be selling into the Dip.....Support is near 704.20 and again at 701.30, 700.30 and 69680.

Resistance is 707.40 to 70880 with heavy sellers near the 712.20. A close over 712.20 augurs for a push into the 714.40 up to 717 and higher

The Stock market should be dicey for a bit, but it ain't over yet.......

More on individual Stocks during the week....

Finally how about the those YANKS.....A well-deserved Victory....

Happy Trading

**A Morning Letter will not be issued unless Special Situations arise**

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