Thursday, March 31, 2005

Traders Helping Traders Daily Update for Wednesday 3-30-05

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ERICH's Update for Wednesday, March 30, 2005
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Tom's Trades were emailed out to the test drivers, so this is just Erich's Update for this issue.
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1: MAY CORN
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CK5 O=2 1/4 HI=4 1/2 LO=1 1/2 C=3

Small day for corn as prices stalled on the 215 resistance. Still at breakeven and looking for prices to continue higher but I'm not holding out a lot of hope. We're nearing the 50% on RSI so we could see a bounce tomorrow.

Remember Thursday is Planting Report day, so we should see something more decisive then.
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2: MAY COTTON
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CTK5 O=00 HI=60 LO=20 CL=58

What did I tell you? Bounce-a-rooney, right off the 5400 resistance. Sure the market fudged the line by a bit...okay a lot, but we did see a reaction off the RSI trendline.

A lower session tomorrow will get me more aggressive about selling, but right now I'm still a little chicken.
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3: MAY BEAN OIL
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BOK5 O=87 HI=05 LO=80 CL=87

Looks like Bean Oil has hit "channel mode" in anticipation of Thursday's report. Seems a little premature, but right now I'm standing aside.

If we see a higher, or lower session tomorrow then we'll look at another entry.
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4: ARPIL LIVE CATTLE
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LCJ5 O=25 HI=45 LO=00 CL=10

No surprise that cattle stalled today after yesterday's big rally. It remains to be seen whether this market can hold these "artifical" highs or whether it will reset itself. Nothing promising for tomorrow.
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5: MAY COCOA
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CCK5

Got filled long on a very weak breakout today, definitely not the way I like to see the market find our orders. The problem with trading a market so soon after it stalls is that it might continue to channel rather than breakout. Hopefully cocoa will regain itself and head higher tomorrow.
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6: MAY WHEAT
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WK5 O=36 HI=41 LO=34 CL=34 1/2

Wheat ranged high enough to find our stops today to take us out of the trade. I felt pretty good about selling the market earlier in the week; however now it looks like prices are waiting for the Planting Report out Thursday. Nothing here tomorrow.
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7: JUNE CANADIAN DOLLAR
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CDM5 O=60 HI=85 LO=38 CL=65

Got a higher session today as I hoped; however it's a little too high, plus the opening gap and weak close don't look too promising for tomorrow. Might wait until we're a little closer to 8356 before trying again.
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8: MAY SILVER
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SIK5 O=1.5 HI=2 LO=0 CL=8.2

Got the bounce off support we were looking for today. Actually prices closed reasonably strong, so we could look at buying the market above tomorrow's high...if it wasn't a countertrend trade that is.

If you do decide to give it a go, you'll probably want to be out around the 719 resistance in case prices stall.
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9: DECEMBER EURODOLLAR
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EDZ5 O=685 HI=695 LO=.675 CL=685

Another small, indecisive day for the ED...but we're getting warmer. RSI is heading up a bit and while I doubt we'll see a substantial move I might look at selling if we see rates challenge resistance tomorrow.
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10: WILD CARD - MAY BEAN MEAL
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SMK5

Steered clear of bean meal today as prices traded within yesterday's range. Might run the same trade again tomorrow; however it is getting riskier doing so just before report day on Thursday.

*SELL May Bean Meal at 184.9
*Stop 186.7
*Approximate Risk Exposure: $180 per contract
*Profit Target: 176.6
*Approximate Profit Potential: $830 per contract
*RRR: 4 1/2:1
*Degree of Risk: HIGH

OR

*BUY May Bean Meal at 189.3
*Stop 186.9
*Approximate Risk Exposure: $240 per contract
*Profit Target: 198.9
*Approximate Profit Potential: $960 per contract
*RRR: 4:1
*Degree of Risk: HIGH

Traders Helping Traders Daily Update for Tuesday, 3-29-05

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Erich's Update for Tuesday, March 29, 2005
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Part One of the Big Weekend Edition is at http://www.supportandresistance.com/testdrive.html.

Scroll down to see Tom's Trades!
"Yes, risk taking is inherently failure-prone. Otherwise, it would be called sure-thing-taking." - Tim McMahon
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1: MAY CORN
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CK5 O=9 3/4 HI=3 1/4 LO=9 1/4 CL=2 3/4

Got a favourable start to the week as corn took a nice rally through our support. A "classic" support and resistance move as prices never got close to threatening the support at 209. Bring exit stops to breakeven for tomorrow. First profit target is 219 3/4.
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2: MAY COTTON
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CTK5 O=20 HI=55 LO=10 CL=96

Huge move for cotton today as prices rallied right through the 5400 resistance. I'm almost convinced cotton did this to call my bluff about buying it, but RSI is at a test point so I'd rather wait for a reaction to sell.

If you wanted to be super aggressive consider selling from near the high tomorrow with stops set slightly higher...but keep in mind this would be very risky. Personally I'm waiting for the reaction.
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3: MAY BEAN OIL
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BOK5 O=06 HI=20 LO=77 CL=79

What corn giveth...bean oil taketh away. At least that's the way it worked today as prices made a decent rally only to peter out and fall back through support. Took a $162 beating...but it could have been worse.
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4: ARPIL LIVE CATTLE
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LCJ5 O=90 HI=90 LO=5 CL=80

Notice cattle's solution to the resistance at 8890 was just to gap it...cute. Today's opening gap would have kept us out of this trade even if we did try to buy it above the 8890 resistance, so I don't feel too bad about missing the move. We've still got a slew of resistance that's making me a little apprehensive about buying. Think I'll give this market another day off.
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5: MAY COCOA
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CCK5 O=70 HI=80 LO=61 CL=70

Cocoa...you're killin me here! I can't believe that cocoa stalled for yet another session. This is not like cocoa at all. The small range really has me tempted to bracket it both ways tomorrow, and given the very oversold nature of the market I would prefer to buy, even though it is a countertrend trade.

*BUY May Cocoa at 1591
*Stop 1569
*Approximate Risk Exposure: $230 per contract
*Profit Target: 1718
*Approximate Profit Potential: $1270 per contract
*RRR: 5 1/2:1
*Degree of Risk: Moderate

OR

*SELL May Cocoa at 1558
*Stop 1571
*Approximate Risk Exposure: $130 per contract
*Profit Target: 1518
*Approximate Profit Potential: $400 per contract
*RRR: 3:1
*Degree of Risk: Moderate to HIGH
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6: MAY WHEAT
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WK5 O=37 H=39 L=32 C=36

Not an impressive day in wheat as prices dropped off sharply at the beginning of the day, only to rebound a bit before the close. We're currently short this market and need a good move to the downside tomorrow, otherwise we are sure to get our stops hit.
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7: JUNE CANADIAN DOLLAR
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CDM5 O=12 HI=13 LO=58 CL=90

Interesting day in the CD today. Notice how rates flinched when they got close to 8150? A higher session tomorrow will confirm resistance and get me in a buying mood.
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8: MAY SILVER
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SIK5 O=4 HI=6.5 LO=3 CL=1

Not a stellar day in the silver pits; however the market is showing slight support. Nothing right now that's getting me too excited however. Think I'll just watch tomorrow.
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9: DECEMBER EURODOLLAR
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EDZ5 O=.655 HI=.67 LO=.64 CL=.665

The ED made a run at support today, even though it was a relatively smallish range. I'd like to sell again below 9562, but the current parameters aren't making it look good right now. Maybe tomorrow.
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10: WILD CARD - MAY BEAN MEAL
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SMK5 O=9 HI=9 LO=5.6 CL=6.1

Interesting little hestitation in bean meal today as prices bounced off resistance and held support as well. A little too early to technically be a channel formation but the market has clearly defined limits for us, so we'll treat it as a channel and take the breakout.

The trade is a little on the tight side, but if we get a decent breakout it shouldn't be a problem.

*SELL May Bean Meal at 184.9
*Stop 186.7
*Approximate Risk Exposure: $180 per contract
*Profit Target: 176.6
*Approximate Profit Potential: $830 per contract
*RRR: 4 1/2:1
*Degree of Risk: Moderate

OR

*BUY May Bean Meal at 189.3
*Stop 186.9
*Approximate Risk Exposure: $240 per contract
*Profit Target: 198.9
*Approximate Profit Potential: $960 per contract
*RRR: 4:1
*Degree of Risk: Moderate
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"Tom's Trades" for Tuesday, March 29, 2005
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1: JUNE 30 YEAR T BOND
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USDM5 O=0-00 HI=0-02 LO=9-23 C=9-27

We sold one at 109-29 we'd rolled the stop to B/E and then I smelled a rat. We started a sideways dance tapping -28 and then -25 ... on and on it went. I jumped out at 25 so I'd have something to show for the day. As it turned out I was right ... we weren't going anywhere. I sold -28 twice more and was stopped out at B/E once and the last one I took out at -25. Grand total of 7 on the day, $218.

Tuesday we should see some movement ... I hope. I have q uite a week to live up to and we need help from the Bonds to have good weeks. The day's settle at 109-27 has our eyes on 110-00 and 109-16 for tomorrow. We are free to buy or sell.
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2: JUNE EURODOLLAR
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EDM5 O=.445 HI=.455 LO=.440 CL=.450

I just looped Wednesday's comment ... Little bitty green candle. I'll just watch. I can't get real serious until I see .50something.
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3: JUNE CANADIAN DOLLAR
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CDM5 O=12 HI=13 LO=58 CL=90

We had the target pretty well sniffed out. Only problem was they forgot to give us an entry. Obviously nothing got done here today. I see we have a big up move happening in the electronic ... at the moment of writing this we are at 8263.

I'll play the TT numbers again tomorrow ... hopefully we'll hold this level until the RTH session opens in the morning. Add to the mix a buy on a retest of 8160 as it breaks above 8167 ... there's an S&R range there from 8160-67 ... or a sell on a break below 8160.
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4: JUNE MINI RUSSELL 2000
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ERTM5 O=7.30 HI=0.30 LO=5.00 CL=7.00

As the curtain rose on our trading window we were sitting on 617.50. We finally made the move to 620. It made a bunch of tries to break higher without success. I sold 619.70. I was stopped out at 615.70 for $400 on the day.

All the same TT numbers for tomorrow.
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5: JUNE $5 DOW
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EYMM5 O=491 HI=550 LO=481 CL=504

As with the Russell, the Dow window opened sitting right on our number. I bought 1 at 10488 with a stop at 10457. We moved up to 10510 area as any S&R trader would have expected and we mentioned as an alternative buy level. We danced around there for a while before moving up near 10540, another identified roll point ... I rolled my stop to 10527 and was stopped at 10522 for $170. Although this looks like a pretty puny trade you must look at it in the context of return on at risk capital. In that context I made over a 100% in less than 2 hours. $170 doesn't look so puny in that light.

On the pullback following our exit I bought 1 at 10510 and bailed at 10538 for another $140. All the same numbers from TT for tomorrow.
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6: APRIL GOLD
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GCJ5 O=5.00 HI=6.20 LO=3.40 CL=6.00

I sold 423.70 and took my lumps at 424.40 for a $70 loss. I then bought 424.40 and pulled the plug at 425.50 picking up $110. I at least managed to get rid of the loss and pay the broker. Same deal tomorrow ... 424 and the $10 channel.
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7: MAY COTTON
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CTK5 O=.20 HI=.55 LO=.10 CL=.96

That was pretty strong! A gap up at the open propelled Cotton well above 54 hitting 54.55 at its peak. They never gave us an entry to work with. I'll stick with my numbers from TT again tomorrow. They didn't even have the courtesy to leave us a double top up there to contemplate.
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8: MAY COCOA
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COK5 O=70 HI=80 LO=61 CL=70

I bought 1564 and where did it go ... right to 159€ and not 1 tick higher, in fact a rather dramatic reversal occurred at 80 and sent us back south. I'm botted at 1574 for $100. I'll do the same numbers tomorrow.
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9: MAY CORN
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CK5 O=2.09 3/4 HI=2.13 1/4 LO=2.09 1/4 CL=2.12 3/4

It just meandered around 2.09 to 2.11, not even, most all day long ... until right at the very end of day we shot up to 2.13 1/4. It was too late in the day to do the 2.11 buy. We'll see for tomorrow. Same TT numbers.
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10: MAY WHEAT
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WK5 O=3.40 HI=3.44 LO=3.35 CL=3.36 3/4

I sold one as we broke below 3.35 at 3.34 3/4. It then snapped right back after diving hard to 3.32. I didn't have the chance to roll anything ... out at 3.35 for a loss of $12. I bought 3.35 1/4 and was stopped out at 3.35 for a $25 loss. Down $37 for the day on 2 trades. Same numbers from TT.