MARKET UPDATE
JUDY CRAWFORD
(TRADES FOR FRIDAY, MAY 9, 2008)
888-301-8120
jcrawford@zaner.com
USING INSIDE & OUTSIDE DAYS: My Update reviews the markets from a technical standpoint. I often use inside/outside days for market entry combined with other technical indicators. Please keep in mind the following:
- When attempting to buy from an inside/outside day and the formation gives a sell instead, I normally cancel the buy order. The same applies if I'm trying to sell from an inside/outside day and a buy is triggered instead, I cancel the sell order. Such action usually represents a market in conflict so I wait for further clarification.
- A potential signal from an inside/outside day is good for that day only.
POTENTIAL PROJECTIONS: The purpose of including potential projections is to give you a potential only. It is not a target written in stone. Each trader should take into consideration their trading goals and equity situation. The projection is a guideline only.
IMPORTANT: CHANGES IN STOPS: Please be aware that during the day I will move stops as soon as possible to protect profits. Consequently, there will be times when I will show a stop exit that is different than the one published in the last Update or Trade Alert. Only existing clients are notified of these changes during the day.
ELECTRONIC MARKETS: Please note that I use charts for the electronic markets versus the pit for all commodities and enter electronically. I DO NOT place orders for entry for the night session. I wait until the day session or until I arrive in the morning (7:00 am cst). If the market is at or near my entry at that time, I will place the order. I ALWAYS have stops placed for the night session.
TRADE ALERT:
(PLEASE NOTE THAT ALL TRADES ARE GOOD FOR . ALL TRADES ARE FOR THE DAY SESSION ONLY. DO NOT PLACE FOR THE NIGHT SESSION).
Buy July cotton. Buy 71.22 stop. Protective stop 69.30. Potential projection 75.00.
Reasons for the Trade:
1. On both the monthly and weekly charts, the recent sell-off formed key reversal bottoms suggesting a trend change from down to up.
2. On the monthly chart, cotton is holding in support going back to 1992.
3. On the weekly chart, the recent major sell-off held at the uptrend line formed since the May '07 low.
4. On the daily chart, cotton is back over 70.00 support.
5. On the daily chart, the recent low (68.52) held in the same support area formed last December that produced an initial rally to 76.00.
6. Cotton triggered a buy today.
Buy July coffee. Buy 135.60 stop. Protective stop 133.50. Potential projection 144.00.
Reasons for the Trade:
1. On both the monthly and weekly charts, coffee continues to hold on long term support (130.00) going back to the mid 90's.
2. On the monthly chart, coffee has been in a uptrend since the low made in 2001 - which was the end of the bear market. It has had two major waves up since and the recent downtrend could be the set up for a third wave up.
4. On the daily chart, coffee broke out of its steep downtrend formed since the late February high on May 5. Yesterday's sell-off tested and held that breakout suggesting a trend change from down to up.
6. On the daily chart coffee closed above the 20 day moving average for the first time since April 15. At that time it then rallied to 142.85.
7. On the daily chart, coffee has consistently held the mid 128.00 low area since the bottom of the huge sell-off that stopped on March 20. That same area is the same area that it held last November prior to the major rally up to 174.00.
8. On the daily chart, even though coffee has been consolidating, it has formed a small uptrend. It has had two up waves and appears to be starting a third.
Sell July cocoa. Sell 26.29 stop. Protective stop 27.26. Potential projection 23.50.
Reasons for the Trade:
1. On the monthly chart the current major wave up has met projections and has started to back off.
2. The MACD is in the same area where the major top to the market was formed in 2003 and it has started to turn down.
3. The weekly chart is forming the classic top formation - a rally back to test the contract high (29.71) that is failing. It has attempted twice to test it and has been stopped by the 29.00 resistance both times.
4. The daily chart has a previous sell signal that is still intact.
5. On the daily chart, cocoa has twice tried to test the contract high and both times has not been able to get over the 28.00 resistance on the daily chart.
6. Today was an inside day that can trigger a signal and market direction.
CHANGE IN OPEN STOPS:
Long July orange juice from 117.85 up to 118.90.
GRAIN COMMENTS:
JUL CORN: Stops at 619 1/4 were reached this morning. I had lowered it to right above yesterday's inside day. Corn also triggered a buy and took out the previous high of 628 3/4. Today's high 633 3/4. Assuming this is not a false breakout from the consolidation it has been forming since early April, corn could reach the high 690 level. Just watching. Closed 630 1/4, up 17 1/4.
Position: Short 599 1/2 (5.5). Exit 619 1/4 (5.8). Loss $987.50.
JUL WHEAT: An inside day yesterday triggered a buy today. Wheat had support at 800 on the monthly chart that it had failed to hold earlier this month. It is now back over it and it might have the potential for further rally than what was seen today. On the 29th of last month it got to 846 before it backed off and continued its sell-off to 776 1/2. Today it got to 844. The 20 day moving average intersects at 849. If wheat gets through these two resistances, a potential to 900 is there. Just watching. Closed 822, up 14 1/2.
JUL BEANS: Stops at 1311 3/4 were reached this morning. They were filled at 1312. I had lowered the stop to right above its inside day. They rallied to 1321. Not much follow through. They are still stuck in a range since late April. Just watching. Closed 1310, up 1. Position: Short 1278 1/2 (5.6). Exit 1312 (5.8). Loss $1675.
JUL MEAL: It triggered a sell yesterday from Tuesday's outside day. There wasn't much follow through but it sure traded as though it did not want to rally today. In fact, it was lower by a few dollars later in the session but did manage to close higher with the rest of the bean complex. It is back over the 330.00 support area. Keep stops at 342.60. Closed 335.20, up 1.00. Position: Short 328.20 (5.6). Projection: 300.00.
JUL BEAN OIL: It rallied to the 20 day moving average and stopped at 59.85. It is pushing into 60.00 resistance area as well. Just watching. Closed 59.55, up 39.
MEAT COMMENTS:
JUN HOGS: Last time I pointed out that their sell-off was only a correction and the start of a new wave up. They have rallied since but have not taken out the high of the previous wave (77.17). Today's high 77.00. The number to watch is 77.17. Closed 76.47, up 1.20.
JUN CATTLE: Stops at 92.82 were reached this morning. They took out the high of the previous wave up (93.95) and made a new high of 94.20. Follow through could bring them up to the 96.50 area. Right now they are pushing into ressitance on all three charts. Just watching. Closed 93.65, up 1.82. Position: Short 91.55 (5.5). Exit 92.82 (5.8). Loss $508.SOFTS COMMENTS:
JUL COTTON: A trade could be developing. See Trade Alert for details. Closed 70.85, up 73.
JUL ORANGE JUICE: It reached my buy point yesterday. It has consistently held at the 20 day moving average during sell-offs and has been closing over the 120.00 for five days. Today was an inside day. Rallying over 122.85 tomorrow should trigger a buy signal. Move stops from 117.85 up to 118.90. That's below today's inside day and the 20 day moving average. Closed 120.45, up 55.
Position: Long 122.15 (5.7).
Projection: 132.00.
JUL COFFEE: Attempts at buying coffee have not followed through. I will try again tomorow. See Trade Alert for details. Closed 134.55, up 3.60.
JUL COCOA: On every chart it sure looks like it is forming a top. A trade could be developing. See Trade Alert for details. Closed 27.09, up 39.
JUL SUGAR: I sold it today at 11.52. The low 11.33. Keep stops at 11.85 for now. Closed 11.46, down 29.
Position: Short 11.52 (5.8).
Projection: 10.40.
METALS COMMENTS:
JUL COPPER: After that huge rally on Tuesday, it has completely fizzled out. It triggered a sell yesterday and is back under the 20 day moving average. Such is copper and how it trades. Just watching. Closed 378.75, down 4.65.
JUNE GOLD: Long term the charts are not good. Both long term charts maintain their key reversal tops - that technically indicates a major trend change from up to down. The weekly chart still has a sell signal and has been trading under the 20 day moving average for a third week in a row. It appears to me that this current rally is an attempt to hold at the 850 long term support. Many times when a market reaches a support for a first time as is the case here, it will bounce off of it. That is what I see here. The daily has two previous sell signals that are still intact. To add to the situation, gold has been trading under the 20 day moving average on the daily chart since mid March and every attempt to get back over has been a failure. Today gold finally closed over 880.00 resistance. That should help a further rally to sell in my opinion. Waiting to sell. Closed 882.10, up 10.90.
JUL SILVER: It is still stuck in a range between 16.500 and 17.00. Long term it is in no better shape than the gold. Just watching. Closed 16.870, up 17.50.
MISC. MARKETS COMMENTS:JUN CRUDE OIL: Another new high at 124.61. Closed 123.69, up 16.
JUN JAPANESE YEN: It rallied up to the 20 day moving average (96.93) and stopped. I see nothing going on here. Closed 96.34, up 77.
JUN DOLLAR INDEX: It rallied to 74.06 today and then sold off but held at the 73.50 support area. Keep stops at 72.80. Closed 73.66, down 5.
Position: Long 73.37 (5.1).
Projection: 75.50.
JUN EUROCURRENCY: It continued to sell off today but is trying to hold the 153.00 support area. Just watching. Closed 153.75, up 4.
JUN CANADIAN DOLLAR: It triggered a sell today. It had already gone through my sell price by this early morning so I had to pay up a little. It sold off to 98.19. Keep stops at 99.90. Closed 98.22, down 108. Position: Short 98.89 (5.8). Projection: 97.00.JUN BONDS: I tried to sell bonds but they made too much of the move during the night session. Today they had a very aggressive rally. Just watching. Closed 116.245, up 100.5.
There is substantial risk of loss in trading futures and options. Past performance is not indicative of future results.
The information in this email may be confidential and/or legally privileged. It is intended solely for the addressee. Access to this email by anyone other than the addressee is unauthorized. If you are not the intended recipient, please contact the sender and destroy any copies of this message and any attachments. Any unauthorized use or dissemination or any action taken or omitted to be taken in reliance on it, is prohibited and may be unlawful. This communication is neither an offer to sell nor a solicitation of an offer to buy any security or other investment product.
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.
