Erich's Trades for Tuesday, August 16, 2005
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Erich's Update for Tuesday, August 16, 2005
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"I am a slow walker, but I never walk backwards." - Abraham Lincoln
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1: CURRENCIES
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September Australian Dollar ADU5
Looking like we'll get a setback for the next few days nothing new here.
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September British Pound BPU5
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The Pound hesitated as per request, but the market is so oversold I'm going to get picky and expect a bit of a pullback before buying.
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September Canadian Dollar CDU5
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The CD hesitated today as well and while we could buy above Friday's high, the strong support at 8350 is too far away to bring into the trade. With a little luck rates will fall off tomorrow so we can use this strong resistance area.
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September EuroFX ECU5
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Big reversal. Don't like anything here.
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September Japanese Yen JYU5
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The Yen is struggling with the 9200 level, and I'd really like to see a pullback before buying.
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September Mexican Peso MPU5
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The Peso looked very strong today as the market broke the RSI trendline to the upside. I would expect rates to continue higher tomorrow and will run the weekend buy scenario.
*BUY September Mexican Peso at 94.150
*Stop 93.650
*Approximate Risk Exposure: $250 per contract
*Profit Target: 97.750
*Approximate Profit Potential: $1800 per contract
*RRR: 7:1
*Degree of Risk: Moderate to HIGH
OR
*SELL September Mexican Peso at 92.775
*Stop 93.275
*Approximate Risk Exposure: $250 per contract
*Profit Target: 89.775
*Approximate Profit Potential: $1500 per contract
*RRR: 6:1
*Degree of Risk: Moderate to HIGH
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September Swiss Franc SFU5
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Looks like it's heading lower. I'll hold off until we see an RSI test.
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September US Dollar Index DXU5
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If you were short the US Dollar last week, then you're probably not short anymore as rates bounced higher off the 50% level. Still looking to sell, but I'll give it the day off tomorrow.
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2: ENERGIES
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September Unleaded Gas HUU5
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Got the hesitation I was waiting for today and now I'm too chicken to do anything with it. I'll press my luck an see if we can get one more lower session tomorrow.
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October Heating Oil HOV5
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Ditto for Heating Oil. Notice the nice bounce off the "other" trendline.
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October Crude Oil CLV5
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Crude stopped us out shortly after the open as prices came up a few ticks short of our profit target. No matter as we banked about $3700 in profit per contract. That helped pay for part of our daughter's wedding!
Here too we can expect to see crude continue to rally but I wouldn't mind seeing a few "off" days. Holding tight for tomorrow.
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3: FINANCIALS/INDICES
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June (06) Eurodollar EDM6
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We might be a touch early selling the ED as this market has a tendency to range a bit before changing direction, but RSI has given us a hook, albeit a little earlier than expected.
I'll look to sell below Friday's low, although below 95.50 would be even better. Next profit target is the big support at 95.23
*SELL June (06) Eurodollar at 95.505
*Stop 95.575
*Approximate Risk Exposure: $175 per contract
*Profit Target: 95.245
*Approximate Profit Potential: $650 per contract
*RRR: 3 1/2:1
*Degree of Risk: Moderate to HIGH
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September mini-DOW YMU5
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Channel-city. Nothing too intersting right now.
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September mini-NAS NQU5
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Back in familar territory at 1615, but we're too close to the contract high to formulate a profitable trade right now.
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September mini-S&P esU5
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The S&P still looks strong as rates continue to hold the trendline. I'll look at buying this market long on a break of secondary resistance and use today's resistance to cover the trade.
*BUY September mini S&P at 1242.75
*Stop 1237.75
*Approximate Risk Exposure: $250 per contract
*Profit Target: 1278.75
*Approximate Profit Potential: $1800 per contract
*RRR: 7:1
*Degree of Risk: Moderate to HIGH
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4: GRAINS
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September Corn CU5
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Don't you hate it when you've got a market cornered and your trade gets voided by a gap? Yep, me too.
Nothing we can do right now but wait for the next support so we can enter again. The good news is the downtrend is picking up some much needed momentum.
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September Oats OU5
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Not nearly as impressive as the other grains today. Nothing for tomorrow.
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September Rice RRU5
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I have a lot more confidence in the support on the exit than I do in my chosen entry, but if prices rally then reverse below 665, it will be our cue to leave. Next profit target is the 50% retacement at 715.
*BUY September Rough Rice at 672.5
*Stop 663.5
*Approximate Risk Exposure: $190 per contract
*Profit Target: 713.5
*Approximate Profit Potential: $810 per contract
*RRR: 4:1
*Degree of Risk: Moderate to HIGH
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September Soybean Meal SMU5
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I guess there's not question where the Soy complex is heading next. Now we just need to wait for support so we can re-enter the market. Don't think we'll have to wait too long though.
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December Soybean Oil BOz5
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Ditto for Bean Oil.
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September Soybean SU5
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Double ditto for Beans.
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September Wheat WU5
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Go figure that wheat was the "reasonable" market today and fell off very nicely finding our sell order on the way down. Expect prices to continue lower tomorrow.
Leave stops where they are if you can, otherwise bring them to the other side of 319. Maybe we can get to breakeven tomorrow.
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5: MEATS
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October Feeder Cattle FCV5
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Feeder's remain wishy-washy right now. Think I'll just keep watching.
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October Live Cattle LCV5
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Don't you hate it when a market calls your bluff? I sure do. And if any market ever wants to see if you're bluffing cattle is the one that will test you.
Prices gave us the hesitation we were looking for today and while I fully expect a bit of a bounce here over the next few days, I will place an order below the contract low in case the market does fall off further.
There you go cattle...who's bluffing now?
*SELL October Live Cattle at 7917
*Stop 7967
*Approximate Risk Exposure: $200 per contract
*Profit Target: 7637
*Approximate Profit Potential: $1120 per contract
*RRR: 5 1/2:1
*Degree of Risk: Moderate to HIGH
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October Lean Hogs LHV5
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Pigs definitely wanted to go higher today as the market gave us a big rally. Hoping for some resistance on last week's highs so we can plan another buy.
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6: METALS
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September Copper HGU5
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Got a nice fill in copper today as prices rallied without ever looking back. Bring stops to breakeven for tomorrow. First profit target is 174.90.
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December Gold GCZ5
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Hiccup day in Gold as the market is about to adjust a bit for last week's big rally. First support is at 444 and if this holds we might consider a buy the day after.
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September Silver SIU5
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I can tell you that it's very likely that silver is going to 685, but it beats the heck outta me how to put together a decent trade here.
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7: SOFTS
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September Cocoa CCU5
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The first day since cocoa's bear rally began that the market was unable to post something reasonably lower than the day before. Prices are quite oversold and we're up against strong weekly support so a bounce might be in the forecast.
Bring exit stops above the 1360 resistance for tomorrow.
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September Coffee KCU5
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In case you didn't recognize it, that's a "holey moley" day.
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December Cotton CTZ5
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Cotton continues to be super cooperative as prices almost reacted our second profit target today. If you're not short this market you still need to wait for support to form in order to get in, otherwise it's just too unpredictable.
Bring exit stops to 4835 (or tighter) if you want to squeeze the market. Next stop is support at 4756.
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September OJ OJU5
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We saw OJ attempt a rally today only to fall off to support before the close. I'm not getting the same warm fuzzy feeling I had before about our trade, but I'll stick to my guns for tomorrow.
*SELL September OJ at 8985
*Stop 9165
*Approximate Risk Exposure: $270 per contract
*Profit Target: 8385
*Approximate Profit Potential: $900 per contract
*RRR: 3:1
*Degree of Risk: Moderate to HIGH
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October Sugar SBV5
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Wow, what a day as prices bounced off resistance and barely broke support. We're currently short this market but can't do too much with our stops right now. First profit target is support at 931.
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