MARKET UPDATE
JUDY CRAWFORD
(TRADES FOR WEDNESDAY, AUGUST 20, 2008)
888-301-8120
jcrawford@zaner.com
ABOUT TRADING:
A client of mine, Larry, made the following comment: "When trading you are committing your money to something that you have no control over so you have to do it in a way to keep yourself out of trouble. You need a system to help you in volatile markets." No truer words were spoken. Statistics show that the successful trader is wrong well over 50% of the time but still makes money because he uses a system.
Developing a system takes time. The purpose of my Market Update is not only to give market guidance but also to show you what the basic components to any system should have prior to placing a trade: an Entry, an Exit, and a Projection. The goal of the Update is to point you in the right direction, save you time and, hopefully, improve your trading skills.
SOME IMPORTANT THINGS TO KNOW:
1. "Trade Alerts" are good for the next day only.
2. I do not enter markets during the night session.3. I always have stops in during the night session.
4. I will move stops during the day and only existing clients are notified of these changes at that time. 5. You are welcome to contact me at any time (whether you're a client or not) to discuss a market or anything in question in the Updates. Either email or phone is fine. I personally answer all inquiries.
OPENING AN ACCOUNT:
Please feel free to contact me regarding opening an account. You will work with me personally. I'm affiliated with Zaner Group, an Introducing Broker, which enables us to clear more than one clearing firm so we can fit the trader to the firm best suited for them. Looking forward to hearing from you!
TRADE ALERT:
Buy December wheat. Buy 901 1/4 stop. Protective stop 865 1/2. Potential projection 10.00.
Reasons for the Trade:
1. The monthly chart is forming a preliminary key reversal bottom.
2. On the monthly chart, wheat continues to hold both the 20 day moving average and the 750 support.
3. On the weekly chart, wheat rallied above the 20 day moving average last week and is holding above it this week.
4. Since the low made in May on the weekly chart, wheat has had one wave up and appears to be setting up for a second wave with a potential to 10.00.
5. On the daily chart, wheat appears to be setting up for a second wave up with a potential to 10.00.
6. On the daily chart, the low made in early August was a key reversal bottom.
7. The daily chart has two previous buy signals that are still intact.
8. Today was an inside day that can trigger a signal and market direction.
Buy December gold. Buy 823.30 stop. Protective stop 809.80. Potential projection 860.00.
Reasons for the Trade:
1. On the monthly chart the recent sell-off held at the 775.00 support. This is also where the 20 day moving average intersects.
2. On the weekly chart, gold is holding at the 780.00 support. That support held the market last November prior to the rally to 1000 +.
3. On the daily chart, gold has had two major waves down. The second and most recent wave down has exceeded projections suggesting an oversold market.
4. On the daily chart, gold has rallied back into the major support formed late last year.
5. Today was an outside day that can trigger a signal and market direction.
Buy October mini natural gas. Buy 8.257 stop. Protective stop 7.880. Potential projection 9.00.
Reasons for the Trade:
1. On both the monthly and weekly charts NG is pushing into suppport between 7.500 and 8.000.
2. On the weekly chart a buy signal would form a preliminary key reversal bottom.
3. On the daily chart NG sold off from 13.800 down th 7.895 (which is almost where the original move began) without a rally retracement. This market is oversold.
4. Today was an outside day that can trigger a signal and market direction.
Sell September dollar index. Sell 76.78 stop. Protective stop 77.60. Potential projection 74.80 area.
Reasons for the Trade:
1. On the monthly chart, the dollar rallied to the 20 day moving average and has started to sell off. That intersects with the 78.00 resistance.
2. On the weekly chart, the dollar rallied to the 77.50 resistance that goes back to last October and is now forming an preliminary key reversal top.
3. On the daily chart, the dollar formed a key reversal top today suggesting a near term trend change from up to down.
4. On the daily chart, the dollar has started to sell off from the resistance area formed last December through February and created a major sell-off at that time.
5. In early August on the daily chart, the dollar broke out of a consolidation (that went back to last March) and rallied to 77.56 today. It has not yet tested that breakout. Normally markets will test a breakout.
6. Today was an outside day that can trigger a signal and market direction.
CHANGE IN OPEN STOPS:
Short December cotton from 71.76 down to 68.45.
GRAIN COMMENTS: These markets have done considerable damage to the previous bull move. Irrespective of that, the initial sell-off was so extensive, they are entitled to more than a day's rally. It appears they are finally doing that which should finally give an opportunity to short at a higher level. Where is yet to be determined.
DEC CORN: I tried to sell it on Monday. The price was never reached. In my last report I pointed out that the heavier resistance was at 600. It has pushed through the previous resistance at 580. In doing so it has managed to rally over the 20 day moving average. That is supportive. Also, on the monthly chart, corn is forming a preliminary key reversal bottom. The weekly chart formed one last week so there is potential for further rally, reaching 600 to 620 could set up for a sale. Just watching. Closed 584 1/2, up 11 3/4.
DEC WHEAT: I have expected a continued rally. Long term it has been holding the 750 support very well. That also happens to intersect with the 20 day moving average. I continue to see a more extended rally. See Trade Alert for details. Clsoed 870 1/4, down 14 1/2.
NOV BEANS: They are giving every indication of a nearterm bottom but are very volatile. They have a key reversal bottom formed on the 11th. They reached 1340 (minor resistance) today but could not hold the gains and formed a key reversal top. I see nothing to do. Closed 1276, down 13.
DEC MEAL: It triggered a sell on Friday and I was stopped out on Monday. Its daily chart looks very similiar to the bean chart. Right now it needs to stay over the 355.00 support and cannot. That is a very important support. It has minor resistance at 365.00 and it backed off from that area today. If it can reach 380, that is major resistance. Closed 347.50, down 3.20. Position: Short 337.20 (8.15). Exit 352.10 (8.18). Loss $1490.
DEC BEAN OIL: It consolidated for well over a week at the 51.00 support and managed to get over the high end of that consolidation today. It rallied right to the 20 day moving average and that stopped it. There is some resistance at 56.00 as well. If it could rally to the 57.00 - 58.00 area, that could be a level to watch for shorting. Closed 53.18, down 15.
MEAT COMMENTS:DEC HOGS: Switching to December contract. I tried to sell them Monday but the price was never reached. I tried again today. The stop was triggered at 74.65. Today's low 74.17. Keep stops at 75.60. Closed 74.27, down 72.
Position: Short 74.65 (8.19).
Projection: 69.50.
SOFTS COMMENTS:
DEC COTTON: I moved stops from 71.76 down to 68.45 this morning. Cotton now has a triple bottom at 67.01. There is an old saying among chartists that triple tops and bottoms are made to go through. We'll see what happens tomorrow. Move stops from 71.76 down to 68.45. Closed 67.19, down 37.
Position: Short 69.49 (8.14).
Projection 62.00.
NOV ORANGE JUICE: Switching to the November contract. It is selling off again. It rallied to the 105.00 resistance area on the weekly chart and fizzled out. So far the sell signal being triggered on the monthly chart this month is holding. It has minor support between 101 and 102 but the stronger support is at 90.00. Closed 101.40, down 3.60.
DEC COFFEE: Switching to the December contract. First I'll finish with the September. I was stopped out today. It rallied to the 20 day moving average and that slowed it. This market still looks negative and needs to do more than this to become bullish. Watching closely. Closed 140.10, up 2.15.
Position: Short 133.90 (8.13). Exit 137.35 (8.19). Loss $1293.75.
DEC COCOA: Switching to the December contract. First I'll finish up with the September trade. It triggered a sell on Friday and was stopped out today. It formed a huge key reversal bottom and outside day. It is still in a downtrend since the high in July. Watching closely. Closed 26.71, up 75.
Position: Short 25.96 (8.15). Exit 26.55 (8.19). Loss $590.
OCT SUGAR: It triggered a sell on Friday. It sold off to 12.76. It has rallied since with a high today at 13.95. Keep stops at 14.07 and let the market work. Closed 13.67, down 2.
Position: Short 13.05 (8.15).
Projection: 12.00.
METALS COMMENTS:
SEPT COPPER: In my last Update I pointed out that it was starting to consolidate. That has continued and today it rallied making a new high up at 347.00. There could be more to this rally and could try for the 355.00 resistance. I don't see it getting past that at this point. Closed 342.85, up 11.35.
DEC GOLD: It triggered a sell on Friday. I had to pay up. It then collapsed so I took profit the same day. It formed a huge outside day today. I sense that it will try to rally from this level. Looking at the daily chart overall, it now has had two major waves down since the high in mid March. The current (and second major wave down) exceeded projections suggesting an oversold market. See Trade Alert for details. Closed 816.80, up 11.10. Position: Short 803.00 (8.15). Exit 790.60 (8.15). Profit $1240. SEPT SILVER: Its current wave down has exceeded projections suggesting an oversold market. Long term it is pushing into good support as well. However, the daily chart triggered another sell today. Just watching. Closed 13.105, up .005.
MISC. MARKETS COMMENTS:
OCT CRUDE OIL: It finally sold off under the 112.00 support but has not been able to stay under that level. It continues to consolidate and the potential for a rally is there. Unfortunately on the long term charts it doesn't have any real support until 110.00. It had some support at 115.00 that it did not hold earlier. Just watching. Closed 114.54, up 1.65.
OCT (MINI) NATURAL GAS: A trade could be developing. See Trade Alert for details. Closed 8.08, up 8.40.
SEPT JAPANESE YEN: It continues in a downtrend even though it rallied today. If there is follow through with this rally it could reach the 92.50 resistance. Longer term it is still negative. Closed 91.20, up 30.
SEPT DOLLAR INDEX: A trade could be developing. See Trade Alert for details. Closed 76.98, down 39.
SEPT EUROCURRENCY: It is now in previous support and has formed a key reversal bottom. I suspect it will try to rally. Considering the extensive top to this market, a rally should be an opportunity to sell. Closed 147.45, up 70.
SEPT CANADIAN DOLLAR: It has a extensive consolidation above the market - just like the euro fx. It has not even begun to meet the potential of that consolidation. A rally in this market should be an opportunity to sell. Closed 94.05, up 14.SEPT BONDS: They rallied to 118.055 today and then sold off, forming a key reversal top. Keep stops at 117.10. Closed 117.29.5, down 9.5.
Position: Long 116.26 (8.13).
Projection: 118.24.
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.
