Erich's Update for Wednesday, September 14, 2005
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Market Update for Wednesday, September 14, 2005
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"Anyone who stops learning is old, whether at twenty or eighty." - Henry Ford
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FYI
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I'm terribly sorry this is so late tonight. I'm out of town a lot this week and by the time I get to a computer it can be quite late. I hope for things to return to *normal* in a few days. Sorry for the inconvenience. -Erich
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1: CURRENCIES
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December Australian Dollar ADZ5
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The Aussie continued lower today, and I'm quite tempted to place a buy order above the high, but think I'll let it go one more day. Some days I just like pressing my luck. ;-)
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December British Pound BPZ5
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The Pound showed us a little support today at 181.60. This isn't quite low enough to count at 181, which was my support target. If we get a reaction here I'll look to buy tomorrow, otherwise we officially move into bear territory.
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December Canadian Dollar CDZ5
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Big day for the Canadian bulls as they rallied the market right from the open. I wasn't expecting this and I'm not quite sure what to make of it. The market might just be filling the gap from the day before, although it would be a little quick for that. Think I'd best leave it alone tomorrow.
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December EuroFX ECZ5
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The Euro found support today right at 123, which is also trendline support. While RSI doesn't echo the trendline test, it is at the 50% level, where we sometimes see a bounce as well. I'll get a little aggressive with this market and look to buy on a break of the resistance above today's high.
*BUY December EuroFX at 124.17
*Stop 123.73
*Approximate Risk Exposure: $550 per contract
*Profit Target: 127.17
*Approximate Profit Potential: $3750 per contract
*RRR: 6 1/2:1
*Degree of Risk: Moderate to HIGH
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December Japanese Yen JYZ5
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We certainly had the right idea about the Yen today, but a nasty opening gap kept us out of the market. Did you notice how rates faded the low open? This is exactly why we monitor opening range. Nothing new here tomorrow.
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December Mexican Peso MPZ5
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We got a late fill in the Peso today as the market found our sell order near the end of the session. I'm not too crazy about getting a late fill, but the market had pretty good momentum the whole day, so hopefully this will spill over tomorrow.
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December Swiss Franc SFZ5
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The Franc is mirroring what we're seeing in the EuroFX, namely a trendline test. Like the Euro, I'll look to buy the market on a break above today's high.
*BUY December Swiss Franc at 8037
*Stop 8013
*Approximate Risk Exposure: $300 per contract
*Profit Target: 8273
*Approximate Profit Potential: $2950 per contract
*RRR: 9 1/2:1
*Degree of Risk: Moderate to HIGH
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December US Dollar Index DXZ5
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It should be no surprise to any of you that the USD is also testing the price trendline today, but in the opposite direction. The US Dollar has an inverse relationship with many of the currencies, especially the Swiss Franc, Euro and Pound.
I'm running the same strategy, but in reverse for the US Dollar tomorrow: selling support insteady of buying.
*SELL December US Dollar at 8717
*Stop 8747
*Approximate Risk Exposure: $300 per contract
*Profit Target: 8563
*Approximate Profit Potential: $1540 per contract
*RRR: 5:1
*Degree of Risk: Moderate to HIGH
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2: ENERGIES
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October Unleaded Gas HUV5
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Well, whaddaya know, gas prices slowed to a trickle today as price found support at 185.25. If I was smart I'd bracket today's range, with a preference to the downside, and trade the breakout tomorrow, but to tell the truth I'm still a bit leery of this market.
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October Heating Oil HOV5
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Same story for Heating Oil as prices found support today at 180. Like Gas though, I'm a little gunshy about buying/selling. I know I'll probably regret it, but I'll wait one more day.
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October Crude Oil CLV5
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Ditto for crude.
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3: FINANCIALS/INDICES
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June (06) Eurodollar EDM6
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The ED bounce a day late today as rates rallied nicely from support. As you know I'd rather sell here than buy, but if the market continues above the 9582 resistance I might be persuaded.
*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: Moderate to HIGH
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December mini-DOW YMZ5
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Big bounce in the Dow today, just as we expected. I'd like to see the market continue lower tomorrow as well, before we get serious about looking for a place to buy.
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December mini-NAS NQZ5
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The NAS followed the other indices lower today as the market took a bounce off 1633 - 1634. Expect more of the same tomorrow.
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December mini-S&P ESZ5
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Got the lower session we were looking for here as well. Another lower day tomorrow will get me seriously looking for support to buy from.
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4: GRAINS
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December Corn CZ5
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Yeech! What a mess. Corn tried to rally today but couldn't. This usually means prices will continue lower very soon...but I wonder if we can get one more day out of this market before selling.
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December Oats OZ5
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A big day for oats as prices continued yesterday's strong session. This market is flirting with resistance at the top of the trading range. If we get a break above the secondary resistance at 158, then I'll look to buy me some oats!
*BUY December Oats at 159 1/4
*Stop 156 3/4
*Approximate Risk Exposure: $125 per contract
*Profit Target: 167 3/4
*Approximate Profit Potential: $425 per contract
*RRR: 3:1
*Degree of Risk: Moderate to HIGH
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November Rice RRX5
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There's the beginning of the Rice bounce. I'd like to see the market continue higher for at least one more session before we look to sell. Looking for resistance at 679 and/or 690.
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December Soybean Meal SMZ5
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Soy Meal stalled out today, which isn't the best news for those of us short the market. Still can't do too much with our stops, but you could bring them above today's high if you wanted to snuggle them up a bit.
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December Soybean Oil BOZ5
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Not much has changed for Bean Oil today. If you're looking to protect as much profit as possible, bring the stops in above yesterday's high, otherwise leave them above 2260.
First profit target is 2141.
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November Soybean SX5
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The big Bean market isn't looking all that cooperative either, but at least we're at breakeven here, so if price do rally we shouldn't get hurt - I hope.
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December Wheat WZ5
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Doesn't that just frost your cookies? We had the right idea in this market, but the range today was too much for our stop placement as wheat stopped us out for a small loss.
I normally give a market the day off after taking a whipsaw, but I might look to buy wheat again tomorrow on a break of resistance above the high. Hopefully things will work out a little better this time.
*BUY December Wheat at 331 3/4
*Stop 328 3/4
*Approximate Risk Exposure: $150 per contract
*Profit Target: 341 3/4
*Approximate Profit Potential: $500 per contract
*RRR: 3:1
*Degree of Risk: Moderate to HIGH
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5: MEATS
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October Feeder Cattle FCV5
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Got the hint of lower prices tomorrow as the market confirmed resistance today. It's actually a very nice setup, and if it weren't countertrend I would look to sell the low, with stops at 113.50-ish and try to collect profit around 110.30. But it is countertrend, so I'll pass.
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October Live Cattle LCV5
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Like Feeder's, Cattle's strong rally is showing signs of a pending pullback over the next few days. The trend is still bullish, so I'll forego selling right now.
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October Lean Hogs LHV5
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If you left your stops then you are still in the market, but if you brought them up, then Hogs would have tagged you out today, but for a profit of about $380 per contract!
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6: METALS
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December Copper HGZ5
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Copper didn't rally high enough to find our buy order, but it's not unusual to see this market alternate higher and lower days. I'll run the order again tomorrow just in case we see a rally.
*BUY December Copper at 165.35
*Stop 163.95
*Approximate Risk Exposure: $350 per contract
*Profit Target: 174.90
*Approximate Profit Potential: $2387 per contract
*RRR: 6 1/2:1
*Degree of Risk: HIGH
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December Gold GCZ5
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A very weak day in gold as prices traded back through the 449 line. RSI is also hooking suggesting that prices are moving lower tomorrow, but I think I'll give it one more day before committing. Gold can be a bit choppy at times as well.
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December Silver SIZ5
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Ouch! What a crazy day in silver as prices made the day's low and high in less than an hour! Needless to say we got whipped in the process like only sivler can do. Nothing here tomorrow.
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7: SOFTS
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December Cocoa CCZ5
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Cocoa got to 1440 before calling it a day. There's bit of support here, and I'd like to see a bit of a bounce off of here.
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December Coffee KCZ5
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Coffee's calling my bluff today as prices gave us the hesitiation we requested. I'll look to sell a break of today's low, tomorrow. I hope I'm not framing the trade too tight as exit stops are going on the other side of the opening price.
*SELL December Coffee at 9145
*Stop 9235
*Approximate Risk Exposure: $337 per contract
*Profit Target: 8855
*Approximate Profit Potential: $1087 per contract
*RRR: 3:1
*Degree of Risk: HIGH
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December Cotton CTZ5
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Cotton fell off nicely today and traded right to support at 4950. If this support holds tomorrow then we will look at buying again. If we break through here then we're definite cotton bears.
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November OJ OJX5
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I'm not too surprised that OJ traded lower today. It was to be expected after yesterday's strong session. Stops are a breakeven again for tomorrow.
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October Sugar SBV5
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Sugar stalled out today after yesterday's breaking of resistance. I'm still holding off on this market until we see it *normalize* a bit. .
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