Thursday, July 14, 2005

Traders Helping Traders Daily Update for Wednesday July 13, 2005

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Erich's Update for Wednesday, July 13, 2005
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1: SEPTEMBER CORN
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CU5 O=5 3/4 HI=7 LO=1 CL=5 1/2

Curious...corn gave us nearly the same range today as it did yesterday, before the report. It seems that traders are much more weather oriented right now than anything else.

Well, our parameters are sound so I'll run the trade again tomorrow; however I'm pulling the sell order and just going with the buy for now. I think we will see a testing of support; however I also think it will be temporary as the trend is still up.

*BUY September Corn at 239 1/4
*Stop 234 3/4
*Approximate Risk Exposure: $225 per contract
*Profit Target: 254 3/4
*Approximate Profit Potential: $775 per contract
*RRR: 3:1
*Degree of Risk: Moderate
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2: DECEMBER COTTON
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CTZ5 O=25 HI=25 LO=01 CL=01

I told you we had cotton cornered! Too bad the market had to take off on us like that. Looking at the chart reminds me of squeezing a bar of soap too hard - oops! There it goes!

We can't really do anything with the market now. It will very likely continue lower tomorrow, as cotton is prone to do; however it's just too risky for me to try to get in at this point in time.

Too bad. It would've been a nice trade.
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3: DECEMBER BEAN OIL
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BOZ5 O=02 HI=42 LO=84 CL=36

Bean Oil inched a little higher today, but failed to break the resistance and find our buy order. I'm not terribly impressive by such an apprehensive market, but will run the buy order again tomorrow.

I'll forego shorting the market until we get back below the current trendline.

*BUY December Bean Oil at 2546
*Stop 2509
*Approximate Risk Exposure: $222 per contract
*Profit Target: 2678
*Approximate Profit Potential: $792 per contract
*RRR: 3 1/2:1
*Degree of Risk: Moderate to HIGH
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4: AUGUST LIVE CATTLE
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LCQ5 O=15 HI=80 LO=15 CL=52

Smallish session today in cattle as prices probed higher but not quite high enough to find our exit order. We're still short this market and I would hope to see prices continue lower after yesterday's strong bear session.

First profit target is support at 7612.
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5: SEPTEMBER COCOA
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CCU5 O=19 HI=28 LO=11 CL=12

Another small day for cocoa as prices battled resistance at 1420 - 1430. I was really hoping for a test at the 1450 or 1460 line, but now it's looking like we might not get that.

Still standing aside until we either see resistance, or get a test at 1450.
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6: SEPTEMBER WHEAT
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WU5 O=33 1/2 HI=35 LO=27 1/2 CL=32 1/2

Not exactly the fill I was looking for in wheat today as prices broke through support, filling our short order, only to rebound before the end of the day.

RSI is also firmly at a testpoint, so it doesn't look all that promising for tomorrow right now. Leave exit stops where they are, but unless we see resistance hold I'm afraid we're going to get whipped.
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7: SEPTEMBER CANADIAN DOLLAR
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CDU5 O=70 HI=33 LO=68 CL=19

Another big day in the CD today as rates are getting very close to the neckline of our rounded bottom formation. I would have pegged the neckline at 8350 and we might see that tomorrow. I would also expect a slight reaction which could give us an opportunity to go long.
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8: SEPTEMBER SILVER
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SIU5 O=0.5 HI=8 LO=4 CL=8.5

Silver was rather cooperative today, giving us the resistance test we were looking for. Actually the market did one better and tested the next resistance at 718 - 719 before backing off.

If this were any other market I'd look to sell below today's low, but with silver's ranges I think I'll wait for confirmation of resistance before selling.
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9: JUNE EURODOLLAR
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EDM6 O=.82 HI=.83 LO=.795 CL=.80

Smallish session for the ED today as rates gave us nearly the same range as yesterday. If you're currently short this market you could bring stops above today's high to take a little risk out of the trade.

If you're not short you could consider selling below today's support and the 9577 area, and use the double tap on today's high to cover the trade.

*SELL June (06) Eurodollar at 95.765
*Stop 75.835
*Approximate Risk Exposure: $175 per contract
*Profit Target: 95.555
*Approximate Profit Potential: $525 per contract
*RRR: 3:1
*Degree of Risk: Moderate
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10: WILD CARD
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No wild card market - yet.
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"Tom's Trades" for Wednesday, July 13, 2005
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1: SEPTEMBER 30 YEAR T BOND
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USDU5 O=7-04 HI=7-09 LO=6-18 CL=6-20

First trade was a sell at 117-07 which we exited at 116-31 picking up 8 ticks on the "once broken I'm gone if it comes back" theory applied at 117-00. I followed that up with a sell at 116-28 which I exited at -27, plus 1. We sold again at 116-29 and out at -25 for 4 more. Sold at -27 out at B/E. Lot of work for not much return. Closed out the day by selling -27 and exiting at -23 for 4. Total for the day is 17 ticks, $531.

Tomorrow we are hawking 117-00 or 116-28. We start a pretty active slate of economic reports tomorrow beginning right after the open with import/export prices and international trade stats. My prediction from the weekend was pretty much right on ... low volume, limited range. 116-16 is a very strong support line at the moment. We could see some real volatility right after the open so I will not trade the first half an hour. -08 and -24 are out of play. These rules will be repeated each day for the balance of the week because of the volume of reports being released.
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2: SEPTEMBER EURODOLLAR
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EDU5 O=.085 HI=.085 LO=.070 CL=.070

I sold 96.080 yesterday, we closed the day at .070 ... a lower low. The stop is at 96.085 as of the close today.
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3: SEPTEMBER CANADIAN DOLLAR
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CDU5 O=70 HI=33 LO=68 CL=19

You look at the chart, you think you hear whispers, you right you're best interpretation ... and the market just makes you feel like an idiot. That was th ecase today. A BIG up move. A failure at 8338 is worth a sell tomorrow.
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4: SEPTEMBER Swiss Franc
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SFU5 O=63 HI=15 LO=54 CL=08

I bought 7860, treating the action as a synthetic test of 7850. I bailed at 7900 as I had no thoughts about keeping it on overnight. Good move as it turns out since the Swiss has been steadily falling in the late electronic session. I'm very happy with my $400.
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5: SEPTEMBER MINI RUSSELL 2000
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ERTM5 O=3.40 HI=7.40 LO=9.50 CL=2.30

Still a toughie for us. As those of you following me for a while know when markets get into uncharted territory I get performnce anxiety and just let it go. This is a weak spot of sorts of my style of trading ... but not really. It is however a real test to just sit and watch being disciplined enough to let the market do it's thing until the structure builds or prices fall back into our "wheelhouse". Nothing done. We'll add 673 to the mix.
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6: AUGUST GOLD
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GCQ5 O=7.30 HI=7.90 LO=5.50 CL=6.30

We got in a couple of licks today. I sold 427.70, rolled the stop from 428.30 to 427.10 as it broke 427 and got stopped there for $60. About an hour later I sold 427.50. As we moved lower I rolled pretty agressively so that when we hit 425.50 I had my stop at 426.10 ... they came and got us there for $140. Compared to what we've been getting lately, $200 is fine, fine.

Same numbers from TT again tomorrow. 424.00 is getting some meat on its bones. I'll NOT trade it yet, but I will use it for management.
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7: DECEMBER COTTON
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CTZ5 O=.25 HI=.25 LO=.45 CL=.01

THEE big mover for the day, cotton reacted to the World Supply and Demand stats by opening with a huge gap lower and quickly hitting the daily limit. That, of course took it completely off our radar. We'll watch for the moment ... spectatorsville.
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8: SEPTEMBER COCOA
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COU5 O=19 HI=28 LO=11 CL=12

I sold 1 at 1418 and was stopped at 20 for a $20 loss. Sold again at 18 and was stopped at B/E. Bought one at 22 and stopped out at 20 losing another $20.

I'll stay with 1420 again tomorrow.
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9: DECEMBER CORN
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CZ5 O=2.46 1/2 HI=2.48 LO=2.42 CL=2.47

Sold 2.45 3/4 and exited at 2.42 1/2 for 3 1/4 cents, $162. I bought 2.42 1/2 and out at 2.47 on a .47 1/4 stop for another 4 1/2 cents, $225. Oh yeah, did I mention, I'm still a scalper in grains.

Same numbers for tomorrow.
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10: DECEMBER WHEAT
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WZ5 O=3.47 HI=3.48 LO=3.41 1/2 CL=3.45 1/2

No numbers for us today. I'll stay with 3.50 again tomorrow.