Friday, March 04, 2005

Traders Helping Traders Daily Updates for Thursday, March 3, 2005

==================================================
Erich's Update for Thursday, March 3, 2005
==================================================
Scroll down for "Tom's Trades"! Subscribers got these on Wednesday evening, but the Test Drive version is delivered after the fact. Oh nooo!!!!!! To get yours BEFORE the markets open, go to http://www.supportandresistance.com/subscribe.html

To get a no holds barred, intensive Support and Resistance workout with Tom and Erich LIVE, (A RARE EVENT and more fun than mud wrestling!) go to http://www.supportandresistance.com/seminar-signup.html ==================================================
1: MAY CORN
==================================================
CK5 O=4 HI=4 LO=7 3/4 CL=9

Got some support at 217 today although we were a touch light of the support line. Decision time: do we wait for a reaction, or do we plan a buy now? For those of you who like living on the edge you could buy AT 217 to see if you can scoop the market from the low. Keep an exit order nearby as this is tough to do, but very gratifying when you get it done.

Think I'll take the more conservative approach however and look to buy after we see a reaction to support. I'd consider buying right now; however today's big range is too prohibitive.
==================================================
2: MAY COTTON
==================================================
CTK5 O=40 HI=65 LO=75 CL=19

Scary day in cotton today...good thing we were only watching. Support at 4970 - 4975 is still holding but just like yesterday I'm not keen on selling just yet. I'll continue to look for the next opportunity to buy but I'm not sure that tomorrow is it.
==================================================
3: MAY BEAN OIL
==================================================
BOK5 O=45 HI=54 LO=94 CL=11

Bean oil traded to the 50% retracement today; however prices didn't seem to like that too much as they quickly fell off from there. I'm not usually too keen about taking a trade like this; however another break above the 50% might see prices trade higher to the next retracement.

*BUY May Bean Oil at 2357
*Stop 2329
*Approximate Risk Exposure: $168 per contract
*Profit Target: 2459
*Approximate Profit Potential: $612 per contract
*RRR: 3 1/2:1
*Degree of Risk: Moderate
==================================================
4: ARPIL LIVE CATTLE
==================================================
LCJ5 O=75 HI=15 LO=35 CL=80

Somebody in the Cattle pit really doesn't like us. The market behaved beautifully today, falling off nice and steady until we hit the 8530 support again - then it was like someone stuck a pin in the side of the cattle market and prices took off like a shot and rallied right to near where they began.

Goofy day folks. Cost us a couple of hun if you tried the more aggressive trade. If you were sticking with the weekend plan you're still in the clear.

Might run the weekend trade tomorrow, but given today's reaction I doubt very much that I'll get filled.
==================================================
5: MAY COCOA
==================================================
CCK5 O=20 HI=25 LO=05 CL=20

Small day for cocoa today. Something resembling a pullback but nothing too aggressive to the downside. Would actually like to see one more profit taking session tomorrow before we look at buying on Friday (yikes!)

We'll see what we get.
==================================================
6: MAY WHEAT
==================================================
WK5 O=43 1/2 HI=46 1/2 LO=38 3/4 CL=40 1/2

Not much of a reaction today, eh? Prices gave us another hit on the 346 1/2 level, so I'll look to buy above here but I'd really prefer to see prices fall off a bit more first.

*BUY May Wheat at 347 1/4
*Stop 342 3/4
*Approximate Risk Exposure: $225 per contract
*Profit Target: 365 1/4
*Approximate Profit Potential: $900 per contract
*RRR: 4:1
*Degree of Risk: Moderate
==================================================
7: JUNE CANADIAN DOLLAR
==================================================
CDM5 O=60 HI=80 LO=49 CL=77

Yeech! What a mess. This market truly doesn't know if it wants to go higher or lower. After today's reaction to the 8040 I wouldn't be surprised to see a rally to the 8130 resistance to check out the topside again.

Think I'll just stand aside for now.
==================================================
8: MARCH SILVER
==================================================
SIH5 O=3.5 HI=4 LO=0 CL=0.7

Got support at 710 today...a day late, but better late than never, right? Might look at buying again using the weekend trade; however if you wanted to be more aggressive you could buy above today's high.

*BUY March Silver at 738.5
*Stop 733.5
*Approximate Risk Exposure: $250 per contract
*Profit Target: 755
*Approximate Profit Potential: $825 per contract
*RRR: 3:1
*Degree of Risk: Moderate to HIGH
==================================================
9: DECEMBER EURODOLLAR
==================================================
EDZ5 O=.975 HI=.02 LO=.965 CL=.005

Slight more bullish day today, which is what we were hoping for. I'd like to see rates increase a little more tomorrow before we look for another chance to sell. Certainly if the market retraces to 9611 we'll be getting VERY serious about shorting again.
==================================================
10: WILD CARD - APRIL LEAN HOGS
==================================================
LHJ5 O=30 HI=95 LO=45 CL=65

Got the reaction to resistance on today's high as prices backed up pretty much to where they began. Interesting to note that RSI broke the trendline today. I'll be holding off one more session to confirm resistance before selling but if you wanted to be more aggressive look to sell below today's low. Hope the market doesn't run away on me. ;-)
========================================================
"Tom's Trades" for Thursday, March 3, 2005
========================================================
1: JUNE 30 YEAR T BOND
========================================================
USDM5 O=1-30 HI=2-08 LO=1-24 CL=2-01

We opened the day selling 111-28 and getting stopped out at 111-27 for one whole point. We then bought 112-03 only to be stopped at 112-04 for another 1 tick. bought -03 for a B/E. That was all the excitement I could handle in 1 day. We ended the day at 112-01 putting us on 112-00 for tomorrow. We'll go either way, buy or sell, depending on how the wind blows. After that it's 112-16 or 111-16.
========================================================
2: MARCH EURODOLLAR
========================================================
EDH5 O=.990 HI=.995 LO=.987 CL=.990

We sit, we watch, we zzzzzzzz ... A real snore job here. It'll move, soon, maybe, well ... perhaps. :)
========================================================
3: MARCH CANADIAN DOLLAR
========================================================
CDH5 O=48 HI=70 LO=37 CL=68

We only got as high as 8068. No breaks of any of our numbers ... nothing done.
========================================================
4: MARCH MINI RUSSELL 2000
========================================================
ERTH5 O=7.30 HI=8.50 LO=6.50 CL=7.90
Hopefully we'll get more proficient at reading the chart as we go along. Get a little more used to the spacing and the cycles. A few weeks from now, faced with the same chart, I suspect we might have bought on the break above 635 early in the day. I think I might have been too cautious ... 635 is strong enough to trade. We should have.

We did a little damage to the sure footedness of the chart with the pop above 640 today. It pulled back very quickly, but damage none the less. We bought 640.50 rolled to B/E at 641.50. The violent failure at 643.50 had me headed for the exits as fast as I could go. I closed out at 642.70 for $220. We then sold 637.60 nand bailed at 636.60 for $100. $320 for the day and done.

We ended the our trading window with the market right on 637.90. We'll see where they position us us in the morning for the RTH open. Same guidance from TT and Monday's Update for tomorrow.
========================================================
5: MARCH $5 DOW
========================================================
EYMH5 O=809 HI=823 LO=804 CL=818

A bit of the same Russell story is applicable hear. Somr damage done the resistance up top and then a swift correction. We sold 10839. I exited at 10798. I tried to do it earlier but couldn't get the order done as fast as I'd wished. Still, 41 is 41, is $205. We were all done at that point.

Same numbers and guidance from TT for tomorrow.
========================================================
6: APRIL GOLD
========================================================
GCJ5 O=5.80 HI=5.00 L=0.50 CL=3.80

Finally, a little reward for our patience. I bought 431.60. It is arguable whether we had a confirmation or no. Truth told, probably not. I viewed the gap open as the confirm by virtue of its own merit. I was stopped out at B/E. THAT WAS THE CONFIRM, DUMMY. I should have waited for it instead of trying to prove how smart I was. I was lucky it didn't cost me any money. I then bought 431.80. I noticed in my analysis that 434 is rapidly becoming a force of S&R much like 424 was a month or so ago. When we got above 433.50 I brought my stop to 433.10 and got hit right there ... out with $130. We corrected back to 432.10. That wasn't quite far enough to let me buy again, of course, off we went.

$10 Channel tomorrow.
========================================================
7: MAY COTTON
========================================================
CTK5 O=.40 HI=.65 LO=.75 CL=.19

Wicked day! I bought 51.45 and was stopped out at 51.40 for a loss of $25. I was going to sell the break below 50.00 but it came at the end of such a long run I backed away.

I'm a watcher tomorrow. Too whippy for me to get comfortable with RRR on anything.
========================================================
8: MAY COCOA
========================================================
COK5 O=30 HI=54 LO=20 CL=52

A tough day for those long. Still a watcher not an acter [sic]
========================================================
9: MAY CORN
========================================================
CK5 O=2.24 HI=2.24 LO=2.17 3/4 CL=2.19

I sold 2.21 3/4 with a stop at 2.22 3/4 for risk of $50. When we hit 2.17 3/4 I rolled the stop to 2.18 3/4 and was filled at 2.19. We picked up 2 3/4 cents $137.

We have a really great set up with the close today at 2.19 again. We have big S&R at 2.18 and 2.17. I'll sell a break below 2.17; I will buy a retest into the penny range as it comes back above 2.18. @.17 1/4 is the stop on the buy, 2.18 1/4 is the stop on the sell. I'll also sell a retest of 2.22 that fails to break out above and I'll buy the break out above. Love those S&R ranges.
========================================================
10: MARCH WHEAT
========================================================
WK5 O=3.44 HI=3.46 1/2 LO=3.38 3/4 CL=3.40 1/2

We have a double top at 3.46 1/2. I'll sell aretest and failure there. I would view anything above 3.44 as a retest. First choice on the stop is 3.46 3/4. If the fill is closer to 3.44 you might want to shorten the stop up just a tad.
========================================================
.

Traders Helping Traders Daily Updates for Wednesday March 2nd

========================================================
"Tom's Trades" for Wednesday, March 2, 2005
========================================================
Subscribers got these on Tuesday evening, but Test Drive Edition is delivered after the fact! To get yours BEFORE the markets open, go to http://www.supportandresistance.com/subscribe.html

To see Tom and Erich in action LIVE, (A RARE EVENT!) go to http://www.supportandresistance.com/seminar-signup.html ========================================================
1: JUNE 30 YEAR T BOND
========================================================
USDM5 O-2-09 HI-2-10 LO-1-29 CL-2-06

A very lackluster day on the heels of our great day yesterday. We remained in a narrow range bounded by 112-09 and 112-01 for most of the day. I made 2 trades attempting to catch something from the bounces back above 112-03. Both of these ended in B/E trades. I did a third trade buying 112-03 just before noon Chicago time. I approached this trade with a belief we'd not go higher than 112-09. I just wanted to make something on the day. I jumped ship at 112-08 picking up 5 ticks, $156.

Tomorrow we'll be poised to rumble at 112-00 selling the break below or buying the bounce back higher. We will also be eyeing 112-16 with the same approach, buying the breakout above, selling the test and subsequent failure. ========================================================
2: MARCH EURODOLLAR
========================================================
EDH5 O–.987 HI–.992 LO–.982 CL–.990

A lower low and high is about all to be said for today's activity. They also serve who watch and wait :) ========================================================
3: MARCH CANADIAN DOLLAR
========================================================
CDH5 O-05 HI-13 LO-30 CL-58

We sold one at 8096. With 8080 and 8060 right below us, the management had to be tight. I had the stop at 8073 when we went thru that level and was stopped out at 8077 for $190. I then sold 8077. As we got into the low 8060's I rolled to 8071. As the low 50's showed I rolled to 8061. They came and got us and then dropped like a stone ... so frustrating. It's that ol' bug/windshield dynamic. picked up another $160. We ended the day back at 8058, just below the 8060 S7R line. We'll start there with the guidance from weekend TT.
========================================================
4: MARCH MINI RUSSELL 2000
========================================================
ERTH5 O-3.80 HI-0.20 LO-3.20 CL-8.30

We sold 637.90. I rolled and was stopped out at 634.60 making $330. Sold 637.60 and out at 636.60 for $100. Sold 637.30 and stopped out at 635.30 picking up another $200. Why would anyone daytrade the S&P emini with this going on right under their nose? Beats me. On the TT numbers again tomorrow.
========================================================
5: MARCH $5 DOW
========================================================
EYMH5 O-775 HI-857 LO-763 CL-827

It came close to the 107.50 mark in the wee hours of the morning. During our watch cycle we only saw 10784. That would have been nice as it climbed pretty strongly from there right back to 10840. I finally did sell 10835. We went to 10800 and pretty much died there for a bit. I bailed at 10802 grabbing 33 ticks, $165. From there it went all the way back to 10850's. I would have sold again there but it was well into the final hour. We dropped to almost 10800 again in the final half hour. We'll play yesterday's guidance again tomorrow.
========================================================
6: APRIL GOLD
========================================================
GCJ5 O-6.50 HI-6.70 LO-2.00 CL-3.90

A nice $400 plus daily range but nothing at our numbers to latch on to any of it. $10 Channel again tomorrow.
========================================================
7: MAY COTTON
========================================================
CTK5 O-.70 HI-.20 LO-.70 CL-.59

Nothing for us today as we saw the market do a little correcting. I'll play the numbers from yr=esterday again tomorrow. 50.00 lookin' pretty yummy again. Not for me, but again, I wouldn't argue very hard against doing it if we get a test and then failure to go lower there.
========================================================
8: MAY COCOA
========================================================
COK5 O-30 HI-54 LO-20 CL-52

Not AS strong, but strong still. Expect more. I'm still sitting on the sidelines.
========================================================
9: MAY CORN
========================================================
CK5 O=2.21 1/2 HI=2.21 3/4 LO=2.19 CL=2.19 1/4

I sold 2.21 1/2 and have my stop at B/E. We'll stay with it into the morning session opening if possible. Opps, apparently we won't as we were stopped out. I don't have my fill yet but it should be real close to our number. I'm watching tomorrow unless it breaks 2.22 headed south. I'll sell this scenario.
========================================================
10: MARCH WHEAT
========================================================
WK5 O=3.41 1/2 HI=3.43 1/2 LO=3.37 CL=3.38 1/4

A very small correction marks this day's activity. I'm still a watcher.
========================================================
Erich'sUpdate for Wednesday, March 2, 2005
========================================================

"Have no fear of what the future holds, for God holds the future." - Eugene Collins
==================================================
1: MAY CORN
==================================================
CK5 O-1 1/2 HI-1 3/4 LO-9 CL-9 1/4

And let the profit taking begin! Corn prices fell off a bit today, no doubt due to profit taking at the 225 resistance from yesterday. Fundamentally everyone is saying there's nothing to hold corn prices up; however I think we will see another rally in the near future. For the time being however, we're in an uptrend, so I'll avoid selling. Would like to see support at 217 tomorrow which would get me looking to buy again.
==================================================
2: MAY COTTON
==================================================
CTK5 O-70 HI-20 LO-70 CL-59

If you've ever wondered why I use profit taking targets today's action in cotton should answer your question. Yesterday we were up $800 and today the market tried to take it all away. If you were trading multiple contracts you likely got stopped out of your remaining holdings today, but with a decent profit, so it's not all bad.

Expecting cotton to head lower tomorrow, that's pretty much a given, but since it's a countertrend trade I'm leaving it alone. If you are more daring than I am try to sell it below the low to the 4800 support line.
==================================================
3: MAY BEAN OIL
==================================================
BOK5 O-10 HI-28 LO-70 CL-91

Got stopped out on the open in Bean Oil today. Pocketed a little over $520 for our trouble, so I'm happy. Looks as though prices might try to test support over the next few days. A reaction around 2150 or 2200 could get me long again.
==================================================
4: ARPIL LIVE CATTLE
==================================================
LCJ5 O-20 HI-90 LO-20 CL-50

Cattle continue to be coy, trading within yesterday's range. We have several options available to us now. The safest option is to stick with the weekend plan and/or wait for the market to show us resistance before selling.

The next safest plan is to go with yesterday's entry numbers and sell the market at 8577. The third, and most aggressive plan is to sell cattle on a break of the 8610 - 8620 support. I will be a little more demanding however, and look for prices to break 8600 before selling.

*SELL April Live Cattle at 8597
*Stop 8652
*Approximate Risk Exposure: $210 per contract
*Profit Target: 8402
*Approximate Profit Potential: $780 per contract
*RRR: 3 1/2:1
*Degree of Risk: Moderate
==================================================
5: MAY COCOA
==================================================
CCK5 O-30 HI-54 LO-20 CL-52

Cocoa stalled slightly today. I'd normally consider a buy above resistance when this happens, but the overbought nature of the market is making me a little reluctant to buy in right now. I would much rather prefer to see a bit of a pullback before attempting anything.
==================================================
6: MAY WHEAT
==================================================
WK5 O-41 1/2 HI-43 1/2 LO-37 CL-38 1/4

Wheat gave us a reaction a little earlier than expected but it's welcome all the same. Would like to see prices fall off a bit, maybe to the 328 line, or better yet 323, if that's not too demanding, before looking to buy in again.
==================================================
7: JUNE CANADIAN DOLLAR
==================================================
CDM5 O-15 HI-18 LO-40 CL-67

How do you make the Canadian Dollar decline? Threaten to buy it! LOL!

The CD fell off nicely today and never threatened our buy order. This is fine, since the market didn't do as we expected; therefore our order was not filled. Always keep in mind that we are traders and not forecasters, there's a BIG difference. I'd like to sell the market tomorrow; however we've got familiar support at the 8040 low. If we see another lower session then we'll look at selling - if the setup is right.
==================================================
8: MARCH SILVER
==================================================
SIH5 O-4.5 HI-4.5 LO-7 CL-2.9

Silver followed the CD lower today as the US Dollar rallied. Like the Canadian Dollar, silver finds itself at reasonably strong support at the 717 - 719 area. Since this market is in an uptrend I would avoid the countertrend trade anyway, but I'll look for a confirmation of support as a signal to buy.
==================================================
9: DECEMBER EURODOLLAR
==================================================
EDZ5 O-.985 HI-.01 LO-.955 CL-.975

Well whaddaya know...the support line held! ;-) Okay, this is beginning to look a little more promising now. Ideally we will see rates hike a little higher over the next day or two before we look at selling again. Even if we get one more tag on today's support, that would give us a comfortable entry level for a sell. I am expecting rates to rally, but given the strong downtrend I will avoid buying at the moment.
==================================================
10: WILD CARD - APRIL LEAN HOGS
==================================================
LHJ5 O-75 HI-70 LO-50 CL-25

Yep, I was right about the trade after all, unfortunately we were just one day early. I see from the forum that some of you might have timed your trade a little better than I did, so you are currently long the market. Look for initial resistance to occur on today's high after which I think you'll be okay until 7640 - 7650.