support at or near $877-$882 and as the grain markets

have accepted the USDA's figures in planting intentions

on Monday, digested the, liquidated many and "reversed"

to the upside yesterday. Note the chart of new crop

November soybean this page. Note that "beans" opened

sharply lower amidst massive carry-over liquidation from

Monday's limit-down close, and that they never traded

lower again, forging a classical "reversal" to the upside.

Corn did much the same: opening lower amidst massive

margin call liquidation, and then trading higher almost

immediately and closing hard upon the day's highs.

Cotton, of which we are long, did essentially the very

same thing: it opened lower; found support and closed

strongly on the day, reversing to the

upside. We think, for some point in the

future, we shall look back upon

yesterday's "action" in the markets as

an important low for many, many

different commodities. The margin

clerks held their control for a while, but

we suspect they've relinquished it for

now.

Gold has had an absolutely massive,

massive correction. The public has been liquidated out of

their positions. Open interest in the futures have fallen

sharply and the phone call requests that we get from

various media outlets are overtly bearish as they ask us

"How much farther down do you think gold will trade"

rather than the opposite question asked of us relentlessly

in late January and early February.

There have been rumours... and rumours of rumours...

concerning central bank selling of gold. Last week, the

Bundesbank was the rumoured seller, with the Bank

issuing a statement that it was not selling its gold. To that

end, we do note that the ECB’s weekly statement on gold

activities noted one legacy central bank as a seller... of a

very modest amount: 0.55 tonnes. Last week these same

banks sold 3.01 tonnes, and even that is far below what

they can sell on a weekly basis if they are to meet the

sum agreed upon under the Washington Agreement [Ed.

Note: Please understand, there is no weekly target for

sales under this agreement. The agreement merely

allows its signatories to sell up to 500 tonnes of gold in a

year, so if the banks were to sell gold on a regular basis,

they need to sell a bit less than 10 tonnes per week.

They've not done so in any week yet, however.]. To the

ECB's obvious embarrassment, it had to say that it has

not been able to make a truly proper report for the past

month because one member national bank has been

unable to get its paperwork in, thus leaving the report

less-than-perfect. It is thought that the offending central

bank is The Bank of Greece, for its employees have been

on strike for the past several weeks. This is relatively

unimportant, however, for the bank in question holds only

3.48 million ounces of gold in its reserves. This compares

to The Bundesbank's 110 million ounces, or to the Bank

of France's 93 million. In other words, those suggesting

that the ECB has not issued a proper weekly report in

order to hide material central bank selling are wrong