Traders Helping Traders Daily Trade Updates for Tuesday 6-7-05

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Erich's Update for Tuesday, June 7, 2005
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Nothing from Tom today due to a family emergency!

Subscribers got these on Monday evening, Test Drivers get theirs after the fact. To get yours hot fresh and BEFORE the markets open, go to http://www.supportandresistance.com/subscribe.html

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"To think too long about doing a thing often becomes its undoing." - Eva Young
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1: JULY CORN
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CN5 O=5 HI=5 1/2 LO=0 1/2 CL=0 3/4

A very strange day in corn today as the market made another hard bounce off the 225 1/2 resistance line. If we see a break through here tomorrow then it will confirm the uptrend, but to tell the truth I think I'll stand aside as today's session was very bearish.

[PS. No, we didn't get filled today because of the huge opening gap.]
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2: JULY COTTON
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CTN5 O=49 HI=65 LO=15 CL=37

A little surprised that we got filled in cotton today as I was expecting a little more of a pullback, but it seems prices thought otherwise and continued lower anyway.

Filled our sell order easily enough and gave us enough room to get stops to breakeven for tomorrow, although a more flexible plan is to leave them where they are assuming you can afford the loss if things go badly.

First target is support at 4566.
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3: JULY BEAN OIL
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BON5 O=48 HI=60 LO=12 CL=16

Bean oil mimiced the strange day that we saw in corn as prices opened with a big gap (voiding our trade) and faded against us for the remainder of the session (which is why we avoid the big opening gaps).

I expect lower prices tomorrow based on today's activity but I think I'll sit out and wait for the confirmation.
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4: AUGUST LIVE CATTLE
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LCQ5 O=25 HI=00 LO=20 CL=57.5

Cattle prices rallied somewhat today, but didn't get anywhere near the resistance we are watching at 8450. RSI is looking a little weak, but I do think that we will see cattle continue higher before it comes back down.

Standing aside for the moment.
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5: JULY COCOA
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CCN5 O=25 HI=32 LO=08 CL=21

Hmmm, cocoa gave us the bounce off resistance we were looking for today, but to tell the truth I think the downside is limited because of the support at 1390 - 1400.

I have a good feeling that cocoa will go lower tomorrow based on the RSI hook; however how low it will go is really anyone's guess.

It is a doable trade, but I think I'll pass right now.
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6: JULY WHEAT
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WN5 O=27 HI=29 LO=22 CL=22 1/2

Whew! That was close! Almost got whipsawed in wheat today, but the resistance did what it was supposed to and kept us out of a potentially bad trade.

After today's session things are definitely looking more bearish than before the weekend; however I'll run both trades again and let the market tell us where it wants to go.

*SELL July Wheat at 320 3/4
*Stop 326 1/4
*Approximate Risk Exposure: $275 per contract
*Profit Target: 302 1/4
*Approximate Profit Potential: $900 per contract
*RRR: 3:1
*Degree of Risk: Moderate

OR

*BUY July Wheat at 329 1/4
*Stop 325 1/4
*Approximate Risk Exposure: $200 per contract
*Profit Target: 348 3/4
*Approximate Profit Potential: $975 per contract
*RRR: 4 1/2:1
*Degree of Risk: Moderate
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7: SEPTEMBER CANADIAN DOLLAR
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CDU5 O=47 HI=60 LO=40 CL=50

Nice even numbers on the CD session today. The market finished where it began after wandering slightly, but this is definitely a sign of indecision.

Expect rates to drop off and test support, probably around the 7980 area, from where we might look at another buy.
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8: JULY SILVER
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SIN5 O=0 HI=2 LO=6.5 CL=4

A near identical session to last Friday as silver prices continue to hold their own. I would still like to see a pullback move to clear the tables a bit, but if the market continues to stall tomorrow I'll look at placing another buy order above the resistance.
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9: MARCH EURODOLLAR
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EDH6 O=.13 HI=.14 LO=.095 CL=.115

Small day in the ED as rates tested the relatively strong support at 9610. I would still like to take this market short; however the 9610 and 9604 support areas have to be cleared before I start selling.

Standing aside for tomorrow.
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10: WILD CARD
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No wild card market for tomorrow.
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