MARKET UPDATE
JUDY CRAWFORD
(TRADES FOR WEDNESDAY, SEPT. 8, 2010)
888-301-8120
jcrawford@zaner.com
Trading commodity futures and options involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge and financial resources.
EMOTION is your enemy more than any market will ever be. My Market Update employs a trading plan that a trader can understand and trades that have reasons so that a learning process evolves - helping you combat emotion and establish discipline.
The Market Update is designed to not only help you learn how to trade but also improve your trading approach. By reviewing technically all the major markets as well as give trade suggestions that include the reasons for the trades, you are able to follow and/or compare my work with yours. Or, if you do not have the time, as many don't, simply use my guidelines for placing your own trades.
YOU'RE MISSING SOMETHING! The Market Update is published on Tuesday and Thursday. On alternate days I also publish a Trade Alert that gives suggested trades as well. To sign up for both and have the convenience of receiving all my information via email. visit my website: http://www.tradingfuturesmarkets.com/, register and submit. And you may want to request some of my free trading booklets too!
ESTABLISHING A TRADING ACCOUNT: I offer brokerage services and personal assistance for every level of trader. Open your account with me and deal directly with me - learn while you trade. Feel free to call or email me at any time without obligation. I welcome hearing from you!
TRADING COSTS: All closed out positions include a trading cost of $49.00 round turn plus a maximum potential for exchange fees of $6.00. Most exchanges do not have total costs of that amount but to consider the maximum potential, it is included. Commission costs can be less if full service is not required.
TRADE ALERTS:
Important information regarding placement of trade alert orders:
1. They are placed during the day only (and not at night). All trades are placed in the electronic markets only.
2. They are placed on a buy stop or sell stop basis. That means the market must rally up to the stop price to go long and/or sell off down to the stop price to short. "The use of a stop-loss or stop-limit order will not necessarily limit your losses to intended amounts or guarantee an execution at a specific price, since market conditions may make it impossible to execute such orders."
3. All entry orders are good for that day only.
Buy December bean oil. Buy 41.45 LIMIT. Protective stop 40.05. Potential projection 45.00.
Reasons for the Trade:
1. The monthly chart triggered a buy two months ago that is still intact.
2. Both the monthly and the weekly are over the 40.00 major resistance area.
3. Both the monthly and the weekly have been in up trends since the late 2008 low.
4. On the daily chart, bean oil rallied over the 20 day ma and 41.00 resistance today. That is positive. The 41.00 level is now support.
5. On the daily chart, bean oil appears to be starting a second major wave up since the late June low.
Sell December hogs. Sell 73.17 stop. Protective stop 75.05. Potential projection 70.00.
Reasons for the Trade:
1. On the monthly chart, hogs formed a key reversal top in May that is still intact - suggesting a major trend change from up to down. It formed another key reversal top last month from a lower level.
2. The weekly chart triggered a sell signal last week.
3. The weekly chart has two key reversal tops as well.
4. On the weekly chart, the up trend formed since the mid August low was violated several weeks ago at the same time that it violated the 20 day ma. Both are negative to the market.
5. On the daily chart, hogs rallied to the 75.00 resistance and have been selling off.
6. On the daily chart, hogs closed under the 20 day ma again today.
7. Today was an outside day that can trigger a signal and market direction.
Sell December cattle. Sell 99.50 LIMIT. Protective stop 101.90. Potential projection 96.50.
Reasons for the Trade:
1. On the monthly chart, cattle tested the double top area at 100.20 and are selling off.
2. The weekly chart formed a key reversal top two weeks ago with follow through.
3. The weekly macd is negative.
4. On the daily chart, cattle formed a key reversal top last Friday - suggesting a trend change from up to down.
5. On the daily chart cattle violated the 20 day ma today. That is negative.
6. The daily chart triggered a sell signal today.
Sell December cocoa. Sell 26.95 stop. Protective stop 27.93. Potential projection 25.00.
Reasons for the Trade:
1. On the monthly chart, cocoa sold off under the 20 day ma last month. That is negative.
2. On the monthly chart, cocoa violated the up trend formed since the late 2008 low last month - suggesting a trend change from up to down.
3. On the weekly chart, cocoa failed to hold at the 28.00 support.
4. On the weekly chart, cocoa appears to be in the process of a second wave down that has not yet met potential projections to 25.00.
5. The macd on all three charts is negative.
6. A buy signal triggered on Friday was negated today. Normally when a market does so, it follows through in the new direction.
GRAIN COMMENTS:
DEC CORN: Another new high today at 469. It rallied over the 450 resistance on Friday that I mentioned previously. As pointed out, it had the base under it to push over that and then some. That is important and continues to suggest a near term target of 500. It could go back and test that 450 but it should hold. Closed 466 1/4, up 1 3/4.
DEC MINI WHEAT: It had some resistance at 750. It reached 748 1/2 today and backed off. It has the base under it that it formed during most of August to push over that sooner or later. Keep stops at 685. Closed 735 1/4, down 6.
Position: Long 720 (9.2).
Projection: 800.
NOV BEANS: Last time I pointed out that longer term they suggested higher prices. They took out the August high today. The new high on the daily is 1053 1/2. They could back off and if they do, it is an opportunity to buy. The monthly chart suggests 1145 near term. Watching closely to buy. Closed 1052, up 17.
DEC MEAL: A new high today at 306.90. It is clearly over that difficult 300.00 barrier. That has been a struggle since it was first reached in early August. On the monthly it is again trying for that 20 day ma problem area. If it can get over it, which I suspect it will do, the next resistance will be around 325.00. Closed 306.70, up 3.40.
DEC BEAN OIL: Bean oil is getting very aggressive. Today it left the 20 day ma "in the dust" so to speak on the daily chart. That is very positive. It is also broke out over the 41.00 resistance area. Since the ma intersected in that area, it is even more positive since that normally adds to the resistance. This market is the cheapest in the bean complex. I was stopped out once only to have it turn around the next day. I will try again. See Trade Alert for details. Closed 41.79, up .93.
MEAT COMMENTS:
DEC HOGS: In my last Update I suggested that they could try for 75.00 and that this rally could be an opportunity to short. They reached 75.00 today and sold off. I still see that and will try tomorrow. See Trade Alert for details. Closed 73.55, down 1.10.
DEC CATTLE: In reviewing them today I realized I missed an outside day that they formed on the third. It triggered a sell today. It also took out the double bottom at 99.67. A trade could be developing. See Trade Alert for details. Closed 73.55, down 1.10.
SOFTS:
DEC COTTON: Another new high today at 92.82. It could be headed for the mid 94.00 area. That's resistance going back to 1991. If it goes through that, the next target area is the high 96.00 to 97.00 level. Just watching. Closed 91.18, up 1.73.
NOV ORANGE JUICE: It triggered a buy on Friday and then literally collapsed. It sold off to 133.00. In this process the stops were not filled as it went beyond the required limit on the platform. It did then rally and I was able to exit the position. That type of extreme sell-off makes that market as a trading vehicle questionable at best. Closed 138.55, up 2.15.
Position: Long 141.65 (8.3). Exit 137.40 (8.3). Loss $692.50 (+comm.&fees).
DEC COFFEE: Another new contract high today at 193.55. It appears headed for 200.00 at least with the real resistance coming in around 210.00 on the monthly chart. What makes it difficult is that the daily chart has not met potential projections while on the monthly chart, it has exceeded projections. This tells me one thing - it is in a real volatile zone right now. Anything could happen. Just watching. Closed 192.30, up 5.35.
DEC COCOA: After triggering a buy Friday, it negated it today. That suggests a good potential for another wave down. If so, the rally fizzled out at 28.00. That's better than the last one that couldn't even get off the ground at 29.00. A trade could be developing. See Trade Alert for details. Closed 27.22, down .50.
OCT SUGAR: Another new high today at 21.52. The next resistance area is around 22.00 - 22.50. The next resistance is around 24.00 to 25.00. Waiting to short. Closed 21.45, up .85.
Trading commodity futures and options involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge and financial resources. Opinions are subject to change at any time and are not a solicitation or recommendation to buy or sell futures contracts or options on futures contracts. The information contained in this message has been obtained from sources believed to be reliable but is not guaranteed as to its accuracy or completeness. All known news and events have already been factored into the price of the underlying commodities discussed.
Past performance is not indicative of future results. All suggested trades are based on technical signals/indicators and do not include slippage or cost. Not all trades suggested are taken. Results are based on what the signal indicates not necessarily an actual trade.
Actual results may vary.
