Wednesday, April 20, 2005

Traders Helping Traders Daily Update for Tuesday 4-19-05

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Erich's Update for Tuesday, April 19, 2005
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Hot off the commodity presses to you! Ok, well, maybe not so hot anymore. Subscribers got theirs hot and fresh on Monday evening, Test Drivers get theirs a little after the fact. If you want it all and you want it NOW, go to http://www.supportandresistance.com/subscribe.html

"To win you have to risk loss." - Jean-Claude Killy
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FYI
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Attention VIPer's:

We've worked out the final details in the VIP program and will begin making recommendations this week. I apologize for the delay.
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1: JULY CORN
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CN5 O=3 1/4 HI=4 1/2 LO=1 3/4 CL=2 1/2

Got filled on a rather lackluster day today as corn just barely broke support. Granted it was a slightly more aggessive trade to take rather than waiting for a break of 211 1/4, but hopefully prices won't rally too much the next couple of days.

Leaving exit stops where they are for tomorrow. First target is support at 204 1/4.
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2: JULY COTTON
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CTN5 O=00 HI=73 LO=80 CL=84

A bullish-bearish day in cotton as prices tried to rally but ran out of steam before the end of the day. Did you notice the low of the day? Yep, right back at the 5280 support level. You could run the weekend trade for tomorrow, or adjust it to reflect the 5280 support as follows:

*SELL July Cotton at 5274
*Stop 5316
*Approximate Risk Exposure: $210 per contract
*Profit Target: 5063
*Approximate Profit Potential: $1055 per contract
*RRR: 5:1
*Degree of Risk: Moderate to HIGH
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3: JULY BEAN OIL
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BON5 O=70 HI=70 LO=40 CL=45

I might be playing this a little too cautious, but I think I'm going to hold off selling bean oil for one more day. Run the buy order again tomorrow, but if prices continue lower we'll try to sell as they get closer to 2225.

Right now the 2225 line is just making me a little timid about the whole thing.
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4: JUNE LIVE CATTLE
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LCM5 O=50 HI=82.5 LO=17.5 CL=55

Cattle prices stalled out today as the market traded within Friday's range. I would expect to see a rather aggressive move tomorrow as a result and I still favour the downside for the moment.

The safe trade is to stick with the weekend plan; however if you wanted to pick up a couple of extra points you could tighten the trade somewhat based on today's range.

*SELL June Cattle at 83.77
*Stop 84.17
*Approximate Risk Exposure: $160 per contract
*Profit Target: 82.02
*Approximate Profit Potential: $700 per contract
*RRR: 4:1
*Degree of Risk: Moderate
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5: JULY COCOA
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CCN5 O=35 HI=55 LO=16 CL=39

Cocoa paused slightly today. I think (hope) we will see prices rally tomorrow and test the 1592 resistance which would give us a good selling opportunity. Nothing else for tomorrow.
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6: JULY WHEAT
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WN5 O13 HI15 1/4 LO11 CL11 1/4

Wheat inched lower to the 310 - 311 support line which the market found today. I would dearly love to see a bit of a pullback move here over the next few days just to confirm the support. Watching for tomorrow.
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7: JUNE CANADIAN DOLLAR
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CDM5 O=11 HI=38 LO=06 CL=18

What a choppy ride in the CD today! The market tested the 8012 support several times during the day before finally finding our sell order, but just barely.

I'm never too impressed when the market "smudges" support to find the order, but we're short all the same, so keep your fingers (and toes) crossed that the market continues lower tomorrow. First target is support at 7871.
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8: MAY SILVER
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SIK5 O=2 HI=9 LO=5 CL=4.5

Rather indecisive day in the silver market despite a rather significant decline in the value of the US Dollar. This is a little strange, but RSI is pointing higher which will probably see higher prices tomorrow and a possible test of the RSI trendline.

Watching and waiting.
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9: MARCH EURODOLLAR
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EDH6 O=.025 HI=.065 LO=.98 CL=.01

Might be seeing an early reaction to the 9610 resistance area as prices finished the day pretty much where they began. If we see a lower session tomorrow I might look at selling even though it is a countertrend trade - we'll have to see what the market gives us before I commit one way or another.
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10: WILD CARD - JUNE LEAN HOGS
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LHM5 O=60 HI=60 LO=30 CL=70

Rather bearish day in hogs today as the market fell off right from the open. RSI also gave us a hook and prices fell off to support at 7630, which is decent, but I would have preferred a test of 7600 which would have made tomorrow's entry a little more predictable.

Oh well, you can't have everything, right? We'll have to work with the 7630 support line for tomorrow. The downside is the amount of money at risk, so judge for yourself if you can handle the loss in case the trade goes sideways.

*SELL June Lean Hogs at 7627
*Stop 7702
*Approximate Risk Exposure: $300 per contract
*Profit Target: 7327
*Approximate Profit Potential: $1200 per contract
*RRR: 4:1
*Degree of Risk: Moderate to HIGH
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"Tom's Trades" for Tuesday, April 19, 2005
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1: JUNE 30 YEAR T BOND
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USDM5 O=3-27 HI=4-03 LO=3-19 CL=3-28

After the opening dip, I wanted to buy that puppy in the worst way. They just wouldn't give me a green candle to work with until we ewere up about -25. I was so sure there was a profit in a leg to come off that. As it turned out it was probaly the best opportunity of the day to bag some ticks. Dang rules!

I did sell the break at -29 after we topped at 114-03 and was stopped out at B/E. I sold -28 and was stopped at -29 for a 1 tick loss. I sold 1 at -29 and was stopped at -23 for plus 6 ticks. By then we'd moved into the final hour and I gave it up for the day netting 5, $156.

The close at 113-28 leaves us looking at 114-00 or 113-16 for tomorrow. PPI is out tomorrow and CPI on Wednesday. They are released at about 8:30 EDT. Let them come and the dust settle before attempting any trade. Although the big focus is earnings reports right now, I have a suspicion interest rate markets are hungry for a bit of economic news and these two might very well fill the bill.
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2: JUNE EURODOLLAR
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EDM5 O=.630 HI=.635 LO=.610 CL=.620

We'll be spectator's again tomorrow ... UNLESS ... I will sell a break below 96.600 with a stop at 96.615. Obviously 96.675/.680 remain in play as well.
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3: JUNE CANADIAN DOLLAR
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CDM5 O=11 HI=38 LO=06 CL=18

I sold one at 8036 after we touched 8038. I went to B/E after we broke 8030. I bailed at 8010 ... I stole a page from Erich ...actually a number. I did not want to be short and see a trade that broke 8012. Out with $260.

Same numbers for tomorrow. Do not chase this one. Be careful tomorrow. Make it show you 8040 again. Do not succumb to 8020. You'll regret selling it and you'll really regret buying it.
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4: JUNE MINI RUSSELL 2000
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ERTM5 O=2.40 HI=8.60 LO=7.40 CL=6.20

I got goose bumps watching this market today. So glad I had no numbers to play. Look at the chop in that guy!!! We were left a double bottom to contemplate ... 582.40/.50. You all know what a sucker I am for these things. I will buy a retest of that level on a failure or a punch lower as it comes back thru it. The stop is 582.10. Now, there's a short stop for ya'. It's called the "do what I want or I'm taking my ball and going home" Strategy. I'd love to tell ya' the target's 607. Unfortunately, I don't think we'll recover that strongly. I'll grab all I can on a 590 trade and distapear, as Jaiden would say.
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5: JUNE GOLD
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GCM5 O=9.80 HI=1.50 LO=8.80 CL=1.00

I bought 428.40. Gold made two attempts on the 5 minute intraday to break 430 and failed both times. In the aftermath of the second I used $10 channel help to exit at 429.50 picking up $110. Same numbers and strategies from TT Weekend for tomorrow.
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6: JULY COTTON
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CTN5 O=.00 HI=.74 LO=.80 CL=.84

I sold 54.45 with a stop at 54.75, just above the day's high. I stretched the stop a tad from what I wrote in TT ... simply ... because it made absolute sense. I bailed at 53.95 as we were running out of time and we'd already failed there once. I listened to the whisper of the market. Out with $250.

I will sell a break below 53.50 tomorrow plus do any of the TT trades that show up.
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7: JULY COCOA
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CON5 O=80 HI=89 LO=73 CL=81

I bought one at 1522. I would have liked to see this much earlier in the day however it was just too good to pass up. Once above 1540 there was no way I was going to let the market come back below 1540 and find me still long. When we touched 42 I was gone at 40 for $180. I bought 22 again later in the day. This time we spiked up tp 1555. I immediately tried to get out preserving something above 50 ...no dice, they dealt me a 1546 fill, $240 this time.

I'll play the same TT numbers for tomorrow.
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8: MAY CORN
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CK5 O=2.05 1/2 HI=2.06 3/4 LO=2.04 CL=2.04 1/4

I really wanted to see a break below 2.04. I bought 2.04 1/4 right at the end of the day and have the stop at 2.02 3/4 into the night. When we opened the night session we immediately popped up above 2.05. I do not want it coming back below 2.05 but it's just too close to roll to B/E. I'll leave it for now and look forward to the RTH open. I'm feeling a bit vulnerable on this one. I think it is entirely possible we need to bang on 2.03 a few times before we head higher. I came very close to passing on this one, instead, waiting for at least a break of 2.04. I may regret not doing so tomorrow ... we'll see. If we don't see some early movement higher in the morning I will revert to very tight management.

Same numbers from TT tomorrow if you didn't launch today. You might want to wait a tad to see if we can get below 2.04 before doing your thing.
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9: MAY WHEAT
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WK5 O=3.03 1/2 HI=3.06 LO=3.01 1/2 CL=3.01 3/4

I didn't care for the volatility at the open. Every rise above 3.05 today was followed immediately by red candles which kept me watching. Good thing too. That was a wicked little 4 cent dive near the close. We broke some pretty stout support around 3.02 to 3.03 today. If we break 3.00 tomorrow this could get ugly. I'm tempted to buy a break above 3.03 tomorrow. I won't though. Wait for 3.05 to get taken out.