Erich and Tom's Market Update for Tuesday, November 15, 2005

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Market Update for Tuesday, November 15, 2005
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1: CURRENCIES
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December Australian Dollar ADZ5
The AD fell off today but gapped us on the entry. It was only a small gap so you might have decided to give it a go anyway. If you did take the trade you could tighten the stops a bit so that you have approximately 1/2 the original risk amount.

December British Pound BPZ5
The Pound inched lower today. We've still got strong support at 172.50 and 173.20 just below the market. I'm holding off for the moment.

December Canadian Dollar CDZ5
The CD is in a nose dive as the Federal politicians are up to their old tricks again and that's spooking investors. The market is making such big ranges however that I'm not sure how we're going to trade it.

December EuroFX ECZ5
The EC continued lower today. If you're still short from last week you could bring stops to the other side of 117.70.

December Japanese Yen JYZ5
I halfways expected this from the Yen today as the market gapped our entry and voided our sell order. Too bad.

December Mexican Peso MPZ5
The Peso gave us a bit of breathing room today. We can bring the exit stops under the 93000 support for tomorrow.

December Swiss Franc SFZ5
We got a crappy fill in the Swiss Franc today, and with the high close we can't adjust our stops any either. Buckle your seat belts for tomorrow, this could be a short and bumpy ride.

December US Dollar Index DXZ5
The USD filled our long order today, but it was disappointing that the market didn't close above the resistance. This means it's still intact, and we have to leave stops where they are.

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2: ENERGIES
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January Unleaded Gas HUF6
Gas didn't move much on the price chart; however RSI hooked lower today. This might be an early indication of a breakout tomorrow, so I'm looking to sell last week's low.

*SELL January Unleaded Gas at 153.65
*Stop 154.65
*Approximate Risk Exposure: $420 per contract
*Profit Target: 148.75
*Approximate Profit Potential: $2058 per contract
*RRR: 4 1/2:1
*Degree of Risk: HIGH

January Heating Oil HOF6
Our heating oil trade didn't get filled today as prices reinforced the support line. I'll run the weekend trade again tomorrow.

*SELL January Heating Oil at 177.85
*Stop 178.75
*Approximate Risk Exposure: $420 per contract
*Profit Target: 172.65
*Approximate Profit Potential: $2142 per contract
*RRR: 5:1
*Degree of Risk: HIGH

January Crude Oil CLF6
Crude should follow the other markets tomorrow; however the setup in this market isn't quite as promising as the other two so I'll hold off for now.

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3: FINANCIALS/INDICES
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September (06) Eurodollar EDU6
The ED found our short order today as we sold the low of the day. I'm not too worried about it right now, but I would certainly like to see the breakout continue tomorrow! You can bring exit stops in above today's high.

December miniDOW YMZ5
The DOW is slowing down and will likely find resistance tomorrow. Given the recent rally I think a pullback would be in order.

December miniNAS NQZ5
Same thing for the NAS which has made an incredible run this last week!

December miniS&P ESZ5
And the S&P.

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4: GRAINS
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December Corn CZ5
Corn took a stab higher today which spiked the RSI indicator. We might be looking at a sell in a day or two if prices continue to push higher with these low closing prices.

December Oats OZ5
Big fade day in oats as the market tested the upper resistance trendline. We will likely see prices fall off a bit tomorrow.

January Rice RRF6
Rice has lost its trend and is totally indecisive right now. I suspect we'll see a testing of support before the next rally.

December Soybean Meal SMZ5
Soy meal took back last Friday's gains. Crazy market right now but I still like the upside.

December Soybean Oil BOZ5
If bean oil wasn't so weak looking I'd consider selling it tomorrow. As it is I think nearby support might be a problem for the bears.

January Soybean SF6
You likely got stopped in beans today regardless of where you brought your stops. The market made a full reversal of last week's gains, and I hope you were able to walk away with at least some profit out of the deal.

December Wheat WZ5
I'm not quite sure what to make of wheat's session today, but I'll run the weekend trade again tomorrow.

*SELL December Wheat at 307 3/4
*Stop 310 3/4
*Approximate Risk Exposure: $150 per contract
*Profit Target: 298 1/4
*Approximate Profit Potential: $475 per contract
*RRR: 3:1
*Degree of Risk: Moderate to HIGH

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5: MEATS
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January Feeder Cattle FCF6
Feeders recovered slighly after Friday's big dip. I'm flat this market at the moment, but might get another buy or sell happening as we get closer to resistance.

December Live Cattle LCZ5
No surprise that cattle also gave us a bit of a recovery today after last Friday's big decline. Here too we need to get to more solid numbers before committing.

December Lean Hogs LHZ5
I'm thinking about buying hogs again, especially with the cute little channel that formed the last couple of sessions. I'm going to hold off tomorrow...hope I don't regret it.

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6: METALS
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December Copper HGZ5
Copper's running away again. We'll probably see a lower session tomorrow, but the levels we're trading at make me a little nervous!

December Gold GCZ5
Gold's still undecided as evidenced by the sideways channel. We could bracket this and trade the breakout, but I'm holding off for another day.

December Silver SIZ5
The silver trade is working out pretty well so far. The market made some nice gains today, but the RSI hook and the low close don't look good for tomorrow. The *ideal* stop placement is breakeven, but I'm jamming mine below the close/low to try and take some money out of the trade.

I might even check in during the night and see how things are progressing.

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7: SOFTS
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December Cocoa CCZ5
Cocoa fell off today, but came up short of our entry. I'll run the sell order again tomorrow, but I'm adjusting it a bit for today's session.

*SELL December Cocoa at 1337
*Stop 1357
*Approximate Risk Exposure: $200 per contract
*Profit Target: 1237
*Approximate Profit Potential: $1000 per contract
*RRR: 5:1
*Degree of Risk: Moderate

December Coffee KCZ5
I don't think anyone saw this one coming as coffee prices tanked today! No problemo though, as our buy order was never threatened by the market. Nothing new here tomorrow.

December Cotton CTZ5
Cotton hiccupped today and probably found your exit stop. Good news is we're walking with profit. The bad news is that our stops might have been a little too far away and as such we gave up some profit.

January OJ OJF6
OJ's getting close to another buy/sell as prices have been channelling for the last few sessions. Just watching tomorrow.

March Sugar SBH6
There goes sugar! It's unlikely that we'll see another day like this tomorrow so I'll hold off, wait for resistance and then buy it.

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"Tom's Trades" for Tuesday, November 15, 2005
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1: DECEMBER 30 YEAR T BOND
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USDZ5 O=126 HI=131 LO=101 CL=110

We opened selling 27 and were stopped out at 23 for 5, $156. We tapped on 25 three times which I thought was good reason to get short again. I sold 23. Bonds went straight down from there hitting 11101. I moved the stop to 03 and they immediately stopped us there ... out at 03 for $625. I tried to buy at 11103 and couldn't get a fill. Done. The close at 11110 moves our sites to 11100 and 11116 for tomorrow.
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2: MARCH 06 EURODOLLAR
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EDH6 O=.175 HI=.180 LO=.160 CL=.160

Nothing today. If we test .150 tomorrow and turn back north I risk a buy with a stop at 95.145. The numbers from weekend TT are still in play as well.
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3: DECEMBER CANADIAN DOLLAR
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CDZ5 O=09 HI=26 LO=61 CL=91

In weekend TT I wrote " ... We will sell a break of 8440 with a stop at 8409 ... " Obviously a typo. It should have read 8400, not 8440.

I sold 8395. We complted the rolls down to 8380. We touched 8360 and bounced hard. I exited at 8366 capturing $290. Later in the day we climbed back to 8400 and I sold 8396. I exited near close of the RTH at 8390 for $50. All the weekend TT numbers again tomorrow. We'll add a roll at 8360 as well.
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4: DECEMBER SWISS FRANC
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SFZ5 O=40 HI=80 LO=94 CL=15

I bought 7626 and was stopped at 19 losing $87. I bought 26 again and again lost $87. Obviously we were totally on the wrong side of the trade. Selling each attempt to go above 7620 would have been the way to go today. No structure below kept us from being able to do that. Oh Well.

I'll stick with my weekend numbers even thought they were a fade today.
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5: DECEMBER MINI RUSSELL 2000
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ERTZ5 O=9.50 HI=0.30 LO=2.60 CL=7.00

We began the day selling attempting to sell the break of 670 without success. I sold the break of 688 at 667.60. It immediately told me I was wrong. Out at 668.00 losing $40. I tried to buy the break above 668 but couldn't get a number I'd take. I sold 667.50 and exited at 666.10 for $140. I bought 666.70 and exited at 666.50 dropping $20. Next I sold 664.60 and exited at 665.10 dropping $50. I sold 664.60 and exited at 50 for $10. I tried a couple of more times to sell 664.7050 and had no luck as th emarket was moving around without any clear direction. I threw in the towel. Never got a feel for it today. Ugly day here. Made $40 on the day. Pitiful.

All the numbers tomorrow
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6: DECEMBER GOLD
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GCZ5 O=9.80 HI=0.60 LO=7.50 CL=9.10

We finally got a confirm about 11:30 CST. I sold 468.70. I got stopped at 469.20 on my B/E stop for a loss of $50. 460 and the $10 channel tomorrow.
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7: DECEMBER COTTON
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CTZ5 O=.80 HI=.29 LO=.61 CL=.89

I bought 51.05 and was stopped out at 51.00 losing $25. I sold 50.95. I was a bit slow responding to my alarm. By the time I flipped back over to the chart intending to roll my stop to 73 or so we were already past it moving north. They filled me at 85 so we made $50.

All the same TT numbers for tomorrow.
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8: MARCH COCOA
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COH6 O=50 HI=58 LO=44 CL=51

Tomorrow is FND in Dec Cocoa so we'll roll out to the March 06 contract. It's trading about 25 points higher than was December. 1350 occupies roughly the same chart position as does 1320 on the Dec but not nearly as much structure to consider. I'm going to sit and observe thru the roll process. I'll look at it each night and absorb the info but I doubt we'll do any trades until maybe Thursday at the earliest.
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9: DECEMBER CORN
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CZ5 O=1.96 1/4 HI=1.99 1/2 LO=1.96 CL=1.96 3/4

My goodness ... what's this ... a bounce! I'm an observer until 2.02 1/2
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10: DECEMBER WHEAT
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WZ5 O=3.12 1/2 HI=3.15 LO=3.10 1/4 CL=3.11 3/4

I'd have bought on these numbers today at the retest of 3.10 but the way the price flow went I couldn't get a fill at less than 3.11 so I sat. Same numbers for tomorrow.