Friday, April 22, 2005

Traders Helping Traders Daily Update for Thursday, 4-21-05

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Market Update for Thursday, April 21, 2005
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To get these the night BEFORE the market action, go to http://www.supportandresistance.com/subscribe.html
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1: JULY CORN
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CN5 O=8 1/4 HI=9 1/2 LO=7 1/4 CL=9

Corn continued higher today...no surprise. We're getting close to some heavier resistance though, especially around today's high and 221. Would love to see a reaction here as it would mean we're that much closer to our next trade.
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2: JULY COTTON
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CTN5 O=70 HI=40 LO=25 CL=85

Cotton you evil market you! Why do you continue to tease!

Notice how price tested support yet another day before rallying higher. Cotton is bound and bent that it's going to get me to buy it. Okay, here you go, a buy and sell order for tomorrow. Hopefully if we get a bullish breakout it will be substantial. I'm getting a little tired of getting whipped.

*BUY July Cotton at 5603
*Stop 5553
*Approximate Risk Exposure: $250 per contract
*Profit Target: 5769
*Approximate Profit Potential: $830 per contract
*RRR: 3:1
*Degree of Risk: HIGH

OR

*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: HIGH
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3: JULY BEAN OIL
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BON5 O=30 HI=35 LO=71 CL=87

Oops! Bean oil seems to have reacted somewhat to the resistance at 2330-ish. Not what I wanted to see today but hopefully prices will continue higher tomorrow. Have to leave stops where they are for the moment.
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4: JUNE LIVE CATTLE
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LCM5 O=75 HI=07.5 LO=25 CL=52.5

Got my wish today as Cattle prices found the 8600 resistance. A lower session tomorrow will get me looking short again. I'm tempted to try and sell the market below today's low; however I'm not too comfortable with that idea right now. Think I'll just wait for the reaction.
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5: JULY COCOA
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CCN5 O=51 HI=78 LO=51 CL=63

Here cocoa...just a little bit closer...that's a good market! Cocoa pulled a little closer to our 1595 - 1600 resistance today and a little closer to the RSI trendline. While we might run out of time to sell this market this week I think we might have a great setup for early next week.
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6: JULY WHEAT
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WN5 O=19 HI=24 LO=18 1/2 CL=21

Wheat climbed to the 324 resistance today, just shy of the 325 resistance we were looking at. RSI shows the market at the 50% level, so it will be interesting to see if we get a reaction here. If we do we'll try to sell it some more.
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7: JUNE CANADIAN DOLLAR
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CDM5 O=78 HI=94 LO=35 CL=74

The CD's in definite pullback mode now. Look for a possible reaction at 8120 or 8150 before trying to sell the market again. I'm still preferring the short side of this market, at least for the time being.
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8: MAY SILVER
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SIK5 O=3 HI=6 LO=0 CL=3.7

Yeech! I'd really like to try and get into the silver market but the market's not giving us much of a chance to do anything. Prices are trading near resistance, but nothing strong enough to initiate a trade from. I'd love to see prices fall off a bit the next few days so we can try to scoop it off support again.
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9: MARCH EURODOLLAR
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EDH6 O=.05 HI=.07 LO=.935 CL=.055

The ED continues to struggle with the 9608 - 9610 resistance today. Rates fell off marginally as the market continues to show lots of strength (notice the high closing price?)

I entertained buying the market on a break above the 9610 line; however I think I'll hold off and see if we don't see a testing of the 9585 support - this would be an ideal area to buy from.
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10: WILD CARD
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No wild card market for tomorrow.
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RECOMMENDED BROKER
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If you are looking for a broker that understands the recommendations and could help you place them, call Matt Zimberg at his toll free trading desk at 1-866-658-7815 [or (561)282-6848]. You can also reach him via email at [email protected]
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"Tom's Trades" for Thursday, April 20, 2005
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1: JUNE 30 YEAR T BOND
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USDM5 O=4-04 HI=4-12 LO=3-12 CL=4-09

After giving the Bonds some room to digest CPI ... and aren't you glad we did? ... we found ourselves at 113-16. I bought -21 and was stopped out at B/E. Bought -21 a second time with a much better result:) Out at -29 for plus 8, $250 as it failed very significantly at 114-00. Sold -28 for another B/E. Sold -28 again and was stopped at -29 losing 1 tick. Sold -28 and stopped out at -26 for plus 2. I became a believer we weren't going lower after this one. As we moved into the final hour I buttoned it up for the day. The take for the day is 9 tick, $287.

The close at 114-09 puts us on 114-16 and 114-00 for tomorrow.
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2: JUNE EURODOLLAR
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EDM5 O=.630 HI=.630 LO=.575 CL=.625

That was a nasty little day for the ED. We let the CPI dust settle so didn't jump the break of .600. Same plan from yesterday guides our actions tomorrow.
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3: JUNE CANADIAN DOLLAR
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CDM5 O=20 HI=75 LO=13 CL=59

I sold 8076 as a failure to break 8080. We broke 8040 and I brought the stop to 41 on the "I don't want it coming back above 40 after breaking it" theory. Stopped out at 8044 for $330. I then bought 42 with a 33 stop. When we broke above 70, I brought the stop to 67 ... sure enough they came and got me. Out at 8067 with $250 more.

8080 portion of the weekend TT guidance is the opening focus for tomorrow. If we gap below there, then 8040.
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4: JUNE MINI RUSSELL 2000
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ERTM5 O=7.20 HI=0.40 LO=5.20 CL=7.10

We still have nothing to play with. We are building structure ... filling our sandbox as it were.
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5: JUNE GOLD
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GCM5 O=5.00 HI=7.40 LO=3.00 CL=6.70

Nothing for us today. Same strategies and numbers from TT weekend again tomorrow.
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6: JULY COTTON
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CTN5 O=.70 HI=.40 LO=.25 CL=.85

I started off the day in Cotton selling 54.90. As we broke below 60 I started squeezing on 54.50 by rolling the stop to 54.61. Stopped out at 54.70 for $100. Next was a sell at 54.95. I rolled it to B/E at 54.85 and was stopped at B/E. I sold 1 at 54.95 again and widened my stop a bit. I made it 55.23 and we finally got something to work with. As we broke 5330 I rolled to 43 and was stopped out at 53.50, $725.

Had we not rolled as agressively as we did we would have nearly given it all back at the end of day.
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7: JULY COCOA
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CON5 O=51 HI=78 LO=51 CL=63

Another nothing day. Didn't give us a peek at either 1520 or 1580. Kept us safe and dry. Technically speaking 1578 was close enough to trade. I didn'y get over to the chart quickly enough and it was too far gone. If you were more on the ball than I was you might have made a small profit.

Same numbers and reasoning as discussed in TT weekend.
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8: MAY CORN
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CK5 O=2.10 1/4 HI=2.11 1/2 LO=2.09 CL=2.10 3/4

The big candle failure on the open spooked me a bit. I waited for a bit and just watched. I finally bought 2.10 1/2 and got stopped out at B/E. I bought it one more time and was stopped out at 2.09 1/4 losing $62.

I need a break above 2.12 1/2 in order to buy. 2.11 1/4 is the stop. A break below 2.09 is a sell with a 2.10 1/4 stop.
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9: MAY WHEAT
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WK5 O=3.08 1/4 HI=3.14 LO=3.08 1/4 CL=3.10 3/4

Didn't give us the number. I'll go after the same TT numbers tomorrow ... unless we're crazy volatility tomorrow.

Traders Helping Traders Daily Update for Wednesday 4-20-05

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Erich's Update for Wednesday, April 20, 2005
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Hot off the commodity presses to you! Well, to the Subscribers, anyway. Test drivers by neccessity get theirs after the fact. If you want to get your hot and fresh the night BEFORE the market action, go to http://www.supportandresistance.com/subscribe.html

"To win you have to risk loss." - Jean-Claude Killy
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1: JULY CORN
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CN5 O=3 1/4 HI=8 1/4 LO=3 CL=7 3/4

Now you see why I wasn't too happy with yesterday's fill as prices made a quick about face today taking us out of our trade for a $125 hit. Oh well, better to take our lumps early and get out of a losing position.

Probably see prices continue higher tomorrow, but I'm not one to chase a market. Think I'll hold off until corn gives us the nod to buy again.
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2: JULY COTTON
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CTN5 O=60 HI=60 LO=35 CL=87

Cotton rallied today but ran out of steam again before the close. Obviously our sell order didn't get hit today and I'll probably pull the order for tomorrow. A reaction to the resistance at 5590 tomorrow would definitely get me looking short again by Thursday.
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3: JULY BEAN OIL
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BON5 O=58 HI=15 LO=58 CL=08

Bean Oil found our buy order today as prices posted an impressive rally. Hoping to see the market trade higher tomorrow so that we can get our stops to breakeven. If you wanted to take some risk off the trade use the 2285 support to hide your stops, otherwise leave them alone for one more day.

First target is 2214.
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4: JUNE LIVE CATTLE
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LCM5 O=85 HI=45 LO=52.5 CL=40

Cattle moved higher today towards the 8590 resistance area. Our just-in-case order never got found, which is fine as prices were moving the other way! Looking for a reaction to 8590 before we get serious about selling again.
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5: JULY COCOA
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CCN5 O=45 HI=68 LO=44 CL=55

I can see this trade setting up to be a nice opportunity in another day or two. Prices rallied off support a bit, which is what we were expecting. Once they get to the 1595 area we should be close to an RSI test point and then we'll jump all over this market!
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6: JULY WHEAT
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WN5 O=12 1/2 HI=18 LO=12 1/4 CL=17 3/4

Wheat took a bounce off the 310 support today...and a pretty good bounce at that! Expect prices to continue higher tomorrow and test resistance at 325. I'm standing aside for the moment as this is a countertrend trade, not my particular favourite.
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7: JUNE CANADIAN DOLLAR
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CDM5 O=20 HI=75 LO=13 CL=59

You didn't cross your toes, did you? The CD rallied today off of, you guessed it, 8013 support. I'm most disappointed that the market traded low enough to find our order yesterday. I was certain I had it far enough away, but I guess I was wrong.

Expecting to see rates rally tomorrow but I'll be standing aside until we get another selling opportunity...for now anyway.
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8: MAY SILVER
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SIK5 O=4.5 HI=6.5 LO=1 CL=5

Big day for silver today as prices almost found the 730 resistance at the top of the trading range. I'd love to see prices stall out here briefly (ie. tomorrow) which would give us a great buying opportunity on Thursday.
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9: MARCH EURODOLLAR
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EDH6 O=.955 HI=.08 LO=.955 CL=.075

Strange day in the ED as prices made a rather large range without gaining anything over yesterday. Rates are still contending with the 9610 resistance (or just shy of it) and I would love to see a reaction here tomorrow which might get me short the day after.
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10: WILD CARD - JUNE LEAN HOGS
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LHM5 O=85 HI=75 LO=20 CL=67.5

Ouch! What a nasty day in the hog market as prices fell off slightly before making a hard bounce off support. Not a good day to say the least. Think I'll be standing aside for tomorrow.
==================================================
RECOMMENDED BROKER
==================================================
If you are looking for a broker that understands the recommendations and could help you place them, call Matt Zimberg at his toll free trading desk at 1-866-658-7815 [or (561)282-6848]. You can also reach him via email at Adm[email protected]
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"Tom's Trades" for Wednesday, April 20, 2005
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1: JUNE 30 YEAR T BOND
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USDM5 O=3-18 HI=4-19 LO=3-18 CL=4-12

There was just the briefest sort of flutter in prices at the open as the Bonds digested the PPI stats. I thought it had settled sufficiently to trade. I bought 1 at 113-21. We then began a fairly orderly advance. We blew right through 114-00 without a pause. I immediately set up an exit at 114-15. I'll discuss why I did this below. Sure enough, we were filled at 114-15 picking the Bonds' pocket for 26 ticks, $812. I sold -15 about 15 minutes later and was stopped at B/E. Bonds flattened out, bouncinf between 114-15 and -10 for the balance of the day. It made one run back to -19. This was a clear Double Top on the 5 minute chart. I couldn't resist, I sold it at 114-14. I got pretty agressive with the rolls as the sideways nonsense continued. I blew it out at 114-11 adding 3 ticks, $93 more to the day's take.

The settle at 114-12 puts us on 114-16 and 114-00 for tomorrow. We'll go either way, buy or sell, dependent on how the market price flow unfolds. CPI comes out first thing tomorrow. Let the report release and the market react BEFORE doing anything. I shouldn't take long.

When I saw the market run right by 114-00 in the midst of my trade I placed a limit sell at 114-15. When Bonds have sufficient power to obliterate one of our numbers, be it -00 or -16, the next number in succession usually will cause an end to the run. Thus, having sailed right thru 114-00, I had a strong conviction 114-16 would apply the brakes to the move like Mario Andretti with both feet on the pedal approaching turn 1 at Indy. So why 114-15 if I thought -16 would be the terminus. Limit orders must trade thru the limit specified in order to be guaranteed a fill. Had I placed it as a sell at 114-16 I was running the risk it would make -16 but no higher and therefore NOT get filled. I wanted out if we got there so I simply placed it at -15, insuring that a touch on -16 would provide the desired exit. As it turned out pulled back to -12 after hitting -16. Without the limit order at -15 I would have seen the pullback and been desperate to get out ... probably producing an exit at -12 or -13 ... doing it this way got me an extra 2-3 ticks. It could also have cost me some if Bonds had continued to press the upside. It's a judgement thing. My experience tells me the odds favor an exit with the limit order 1 tick below the next action number. I'll always go with the odds, the probabilities.
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2: JUNE EURODOLLAR
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EDM5 O=.600 HI=.640 LO=.590 CL=.635

We opened at .600, dropped a bit and then headed north. I sat tight at the open because of the PPI repor saving ourselves a small loss had we sold the break of .600. Same numbers tomorrow and same no trade zone at the start to absorb CPI data reaction.
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3: JUNE CANADIAN DOLLAR
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CDM5 O=20 HI=75 LO=13 CL=59

No Tom, you certainly wouldn't regret buying the 8020 break. See what happens when you predict instead of concentrating on hearing the whispers of the market? The CD actually did a very commendable job of respecting S&R at 8012 and 8020 ... they just weren't strong enough lines in my judgement to warrant entry. I waited until 8040 was in the crosshairs and bought 8042. I rolled as guided by TT weekend numbers. When we hit 8075 and failed I brought he stop to 8069 and was stopped out at 8068 for $260.
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4: JUNE MINI RUSSELL 2000
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ERTM5 O=6.50 HI=6.70 LO=6.20 CL=5.80

Never showed us the double bottom number. Nothing for us today. Structure building day.
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5: JUNE GOLD
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GCM5 O=8.80 HI=5.20 LO=8.70 CL=4.40

I bought 429 using the 428 support line. I rolled to B/E as we broke 430. It came back to 429.10 leaving us in the trade by a whisker. I'm out at 434.00 for $500. This came about as a result of rolling the stop to 434.10 when we broke 435.

Same startegies and numbers from TT weekend again tomorrow.
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6: JULY COTTON
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CTN5 O=.60 HI=.60 LO=.35 CL=.87

Nothing today ... overpowered our sell oriented view.

Any retest above 55.00 not higher higher than 55.50 can be sold as it drops below 55.00. The stop is 55.13 and we roll to B/E at 54.91. The target is 52.50. Additional rolls at 54.75, 54.50, 54.27, 54.00, 53.75, 53.50, 53.25, 53.00, 52.75 and the squeeze starts at 52.63.
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7: JULY COCOA
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CON5 O=45 HI=68 LO=44 CL=55

Nothing here today, either.

Same numbers and reasoning as discussed in TT weekend.
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8: MAY CORN
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CK5 O=2.05 HI=2.10 LO=2.05 CL=2.09 1/2

My brother Mike has been a big time drag racer for better than 40 years. Any of you drag racing fans out there have probably seen him or one of my 3 nephews running around the country in 4 cars christened The California Missile" 1-4. On th eback of each car is the following ... "kwitchersnivelin". That's what I was doing yesterday. I was tryin' to CYA in case my Corn trade fell apart. All I had to do was trust S&R and take heart.

Here's a post I did today at the forum ...

Personally, I prefer the Wine Train, but I did so enjoy the ride on the Corn Express today. After a small gap up at the open we marched right up to 2.09. We touched 2.10 and retreated to close at 2.09 1/2. I went thru kind of an interesting exercise to decide whether to take the available profit or stay in the trade. I thought you might enjoy walking through it with me.

As we arrived at 2.09-2.09 1/2 ... an easily identifiable level of resistance; no surprise there, a clear "what's most likely" number ... it became apparent we'd run out of gas ... a call to action ... do we roll the stop tight to protect the accumulated profit or do we bank it and move on to the next opportunity.

The roll was an easy call ... of course, we'll do that ... probably to 2.08 3/4. If you wished to give it a little more room you might justify moving it to 2.07 1/4 on the theory you'll allow no more profit erosion beyond the next lowest support area which is 2.07 1/2 in this case. Ok, we're solid on that, right?

Now, what to do about the other half of the question ... do we take profits. In order to make this decision I need the answers to a few questions. Do I believe this is the launch to way higher numbers? The answer is, "I don't know". It could be, it may not. I doubt it is. The launch from such a strong support level should have propelled us higher ... more like the vicinity of our target at 2/13 ... not that a 6 cent bump is any thing to sneeze at. The safer assumption is clearly it is not THEE move and we continue our scalper mentality. I vote for taking it. If I do take profits here, where can I get back in the trade? Is 2.09 1/2-2.10 strong enough to justify an entry trade? Short answer ... yes, I believe it is. So I have a ticket back on board with a minimum exposure of missing a big chumk of a continuation move higher AND the added benefit of taking off the table any significant opportunity for the market to grab my accumulated profit.

I'm out at 2.09 1/4 for 5 cents, $250.

When faced with a big decision to make, it sometimes helps to add up all the little facts you DO know relating to the decision. See how many questions relating to the bigger issue you CAN answer ... little bites of the bigger decision. I find that many times the best answer will magically appear to you by accumulation.

For tomorrow, we'll buy a break above 2.10, we'll sell a retest of 2.10 on a failure or as it comes back thru. Use the TT weekend guidance as management numbers on the sell. On the buy, the stop is 2.09 1/4, we'll go to B/E at 2.11 1/4. The target is 2.17. Remember, we are scalpers in here ... for the moment.
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9: MAY WHEAT
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WK5 O=3.02 1/2 HI=3.08 1/4 LO=3.02 1/2 CL=3.08

I watched the first 3 5 minute candles and said "no thanks" By the time we'd calmed down a bit we were well above 3.05 and I was happy to say, "nothing done".

I'll go after the same numbers tomorrow ... unless we're crazy volatility tomorrow.
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