Erich's Update for Friday, September 16, 2005

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Market Update for Friday, September 16, 2005
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Hot off the commodity presses to you!
"Anyone who stops learning is old, whether at twenty or eighty." - Henry Ford
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1: CURRENCIES
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December Australian Dollar ADZ5
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The Aussie continues to be quite choppy trading considerably lower again today. It does appear that the market has confirmed resistance and might fall off some more, but there's nothing tradeable here right now.
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December British Pound BPZ5
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Wow, the Pound made a wicked drop right to trendline support at 180 today. Rates didn't even flinch at the 181 resistance, although that is argueably the high for today. Important day for the bulls tomorrow, if they can rally the market then we might see the Pound head higher.
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December Canadian Dollar CDZ5
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The CD dipped lower today to give us an RSI test. If it wasn't Friday I'd look to buy a break of the high, but it is, so I'll wait for confirmation.
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December EuroFX ECZ5
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The Euro officially became a bear market today as rates fell through the trendline support. We should see a slight hiccup soon, but our focus is now on selling.
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December Japanese Yen JYZ5
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The Yen continued lower today as well, but this market is way too choppy to even consider trading right now.
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December Mexican Peso MPZ5
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Got stopped out at breakeven on a slight hiccup in the Peso today. Too bad, as it looks like the Peso might be heading lower for the short term.
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December Swiss Franc SFZ5
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If you never thought you'd be happy to be whipsawed just look at today's open in the Swissy. See what I mean? If we didn't get taken out of the market yesterday we would have experienced a huge gap this morning on the open (almost a $1000 loss!)

In spite of it all support and resistance did keep us out of a bad trade. We took our lumps when the market said we were wrong, and while no one likes to be wrong, I'll take a $300 hit to a $1000 one any day!
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December US Dollar Index DXZ5
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As you might have suspected, the USD rallied today, and quite substantially I might add. We could see a pause tomorrow however as we're trading off resistance at 8800.
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2: ENERGIES
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October Unleaded Gas HUV5
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Gas continues to channel, and while I would like to trade a breakout of the channel I won't press my luck on Friday. After the weekend we roll into the next contract month.
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October Heating Oil HOV5
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Slight hiccup in the HO rally, but that's to be expected after yesterday's strong rally. Nothing I want to try here tomorrow either.
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October Crude Oil CLV5
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Crude reversed from yesterday's rally as well. I hate it when the market's are so choppy, but it's usually a sign of changing trend, which I think is what we're getting here.
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3: FINANCIALS/INDICES
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June (06) Eurodollar EDM6
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The ED is also channelling and while the market is technically in an uptrend, the bulls aren't doing too much about it. If rates break support we'll also change our bias here, but I'll just cover the long side tomorrow.

*BUY June Eurodollar at 95.835
*Stop 95.775
*Approximate Risk Exposure: $150 per contract
*Profit Target: 96.055
*Approximate Profit Potential: $550 per contract
*RRR: 3 1/2:1
*Degree of Risk: HIGH
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December mini-DOW YMZ5
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A sign of support from the Dow today? Maybe, but it isn't confirmed just yet. If we get a bounce off of 10560 then we can get serious about buying, but if we see a break we will look to sell.
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December mini-NAS NQZ5
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The NAS closed too close to the 1600 support line to really determine whether or not it is broken. Personally I think we will see the market continue lower, but I dont' want to play Futures roulette tomorrow.
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December mini-S&P ESZ5
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As usual the S&P mirrored what the other indices are doing, and like the other indices we are trading off substantial support. If we get a bounce we're buyers, otherwise we flip to the bear side.
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4: GRAINS
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December Corn CZ5
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Here we are, flirting with long term support at 205. The trend is down, and strong, but dare we sell? I think I'll wait, just a little longer.
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December Oats OZ5
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Oats stalled today, not able to exceed yesterday's high, but the market is looking stronger as we have a reasonably high close. Nothing new here tomorrow.
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November Rice RRX5
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679 is close enough to the 680 level we were looking for as our first resistance test. RSI is still sloping higher, so I might expect the rally to continue to 690, but we'll see what the market gives us.
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December Soybean Meal SMZ5
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Well whaddaya know, we finally caught a break! I was beginning to think the market's were conspiring against me or something. Soy Meal made a strong move to the downside today and as of the close we're about halfway to our first profit target.

If you're looking to let the trade run as much as possible, breakeven is the best place for your stops. If you want to tighten them up a bit, consider using the intraday resistance at 1775 to place your stops above.
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December Soybean Oil BOZ5
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Bean Oil wasn't nearly as cooperative as Soy Meal today, but the market hasn't found our exit stops yet. Holding everything as is, and hoping for a lower session tomorrow.
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November Soybean SX5
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It doesn't look like much, but today's range picked us up $1000 as of today's close. Now comes the tough part. If you want to let the trade run put stops above today's high (or 580), if you want to protect as much profit as possible use the intraday resistance at 575.
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December Wheat WZ5
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Wheat moved firmly into bear territory again today. In hindsight I got too bullish too quickly as it looks like prices are heading lower for the near future. I'm just watching tomorrow.
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5: MEATS
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October Feeder Cattle FCV5
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Feeder's continue to hold support today. We've got a bit of a channel happening again, but I'm going to pass on doing anything tomorrow.
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October Live Cattle LCV5
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Cattle continue to look strong and I need to get serious about finding a good spot to buy into this market again. I'm still kicking myself for passing on the 8360 breakout.
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October Lean Hogs LHV5
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Hogs recovered quite quickly after yesterday's big bear session. RSI is at a testpoint, so I would think higher prices are likely tomorrow and for the short term.
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6: METALS
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December Copper HGZ5
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Copper is still in no-man's land. I sense a big move coming in this market, but I don't know where, or when.
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December Gold GCZ5
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Turns out we were a few days early with our gold buy as today was the day the market made some serious gains. Not to worry, we'll have another chance very soon. I was surprised to see a rally however, especially with the strength of the USD>
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December Silver SIZ5
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And higher prices were the result today of the RSI trendline break from yesterday. A big day with a weak close, but we'll probably see silver try to get higher still.
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7: SOFTS
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December Cocoa CCZ5
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Cocoa's due for a bounce after a week of straight declines. I hope we see a bounce/pause tomorrow so we can try and sell the market again.
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December Coffee KCZ5
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Quick about face from coffee today, and slightly premature as we're not to our RSI test yet. I know that should be selling a break below today's support, but it's Friday and this is coffee and I'm a chicken. ;-)
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December Cotton CTZ5
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Cotton continues to hang around the 4940 - 4950 line today. The low close looks bearish for tomorrow, but the support is still holding right now.
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November OJ OJX5
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Depending on how tight you made your stops you might have gotten tagged today. You might consider bringing stops in below today's low however, as the smallish session might hint of a reversal tomorrow.
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October Sugar SBV5
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There goes sugar, through the top of the channel. I want to buy this market but I'm more than a little apprehensive about the extremely overbought situation. I would dearly like to see the market *normalize* ...at least a little bit.
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