MARKET UPDATE
JUDY CRAWFORD
(TRADES FOR WEDNESDAY, DEC. 3, 2008)
888-301-8120
jcrawford@zaner.com
Unique and timely technical review of all the major markets including trade suggestions plus the technical reasons for the trades. Published on Tuesday and Thursday, learn while you trade! Additional trade suggestions for alternate days (titled Trade Alerts) are published but not available here. To receive free the complete Market Update including the additional Trade Alerts, sign up on my website: www.tradingfuturesmarkets.com. If you have any questions or want to discuss a particular market or trading in general, give me a call or email. I look forward to hearing from you!
GENERAL COMMENT: Yesterday all the markets sold off with the Dow. In reality what many of the markets did were test theirs lows (or highs) or breakouts: For example, gold tested its breakout of Nov. 21 from the congestion it had been stuck in for a about a month and a half. The FX from its pennant formation. Cocoa its breakout over the 21.00 resistance on the 25th. The dollar and yen another attempt at their highs.
And the Emini sold off from the 900.00 resistance - just like it did from the 1000.00 resistance - heading for its new low. However, the Emini has a different bottom formation under it now then it did when it reached 1000.00. And that bottom formation is a key reversal bottom. That is important because technically that suggests a trend change from down to up. That is the first attempt by the market to establish a bottom formation since this market collapsed in October.
Consequently, a test of that low that holds could be very significant. That test could hold at the current 813.00 low made today or it could sell off more. You just don't know. As long as it holds 739.00, that is key. If not, then the bottom is obviously not in place. If it does, you should see some pretty strong rallies in other markets and possibly even before then. Why? As mentioned before, several markets are already becoming less sensitive to the Dow and starting to break away from it. They may branch off from it sooner more than later because they are pushing into long term support in many instances and under more normal conditions would be in more follow through rallies by now. If the Dow continues to sell off and several other markets cannot take out their lows, that would be further confirmation of their lows. That is why how different markets interact is very important and a helpful tool in determining what they are trying to tell you.
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Emotion is more your enemy than any market will ever be. Trading is not easy. It takes discipline, a plan and the ability to leave your emotions in the other room. My Market Update is designed to help you with that.
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Developing a system to approach the markets takes time. The purpose of my Market Update is to show you some of the technical indicators you should consider prior to entering a trade and to show you the trading components all systems need: Entry, Exit, Projection. My goal is to help you save time and trade better.
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Feel free to call or email me regarding any questions you may have about the markets or about trading with me. I'm available during market hours without obligation.
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SOME POINTERS ON MY MARKET ENTRY & PROTECTIVE STOPS:
I do not enter new positions during the night session but do place stops on existing positions for 24 hour coverage.
I may move stops interday but only existing clients are notified of these changes.
TRADE ALERT:
Buy March mini wheat. Buy 543 1/4 stop. Protective stop 521 3/4. Potential projection 600.
Reasons for the Trade:
1. All three charts consistently hold at the major 500 support level which is positive.
2. The monthly chart formed a key reversal bottom in November suggesting a potential trend change from down to up.
3. On the daily chart, wheat has rallied over the downtrend formed since the August 21 high suggesting a trend change from down to up. It did so over two weeks ago and has been consolidating since.
4. On the daily chart, yesterday's sell-off held the contract low at 515 1/4. A follow through buy could confirm that as a near term bottom.
5. Today was an inside day that can trigger a signal and market direction.
Buy March cocoa. Buy 22.11 stop. Protective stop 21.10. Potentail projection 25.00.
Reasons for the Trade:
1. On both the monthly and weekly charts, cocoa is back over the 22.00 resistance level. This is now support.
2. The weekly chart has a buy signal.
3. On the daily chart, the recent sell-off appears to be the correction to a second wave up.
4. On the daily chart, the recent sell-off stopped at the 21.00 support and appears to be a test of the breakout over that level on 11.25.
5. Today was an inside day that can trigger a signal and market direction.
CHANGE IN OPEN STOPS:
Long March cotton from 43.70 up to 45.95.
GRAIN COMMENTS:
MAR CORN: Switching to March. It formed a double bottom today on the daily chart at 345. The long term charts show corn in long term support. I still don't see enough to warrant a trade. Just watching. Closed 348 1/4, down 1/2.
MAR WHEAT: Switching to March. First I'll finish up with the mini Dec. trade. I tried to buy it last Wed. but it triggered a sell instead from the inside day. I attempted to buy the mini March yesterday. It sold off instead. Another opportunity could be setting up for tomorrow. See Trade Alert for details. Closed 528 1/2, up 1/2.
JAN BEANS: I wanted to see them over 900 before I would be interested in buying them. They have sold off and made a new low today at 826. They are probably headed for 800. Just watching. Closed 827, down 19.
JAN MEAL: Switching to Jan. First I'll finish up with the Dec. trade. I attempted to buy it last Wednesday and was filled on the opening. When it started to form a key reversal top on Friday, I raised the stop to 259.50 and was filled. It has sold off since. The contract low is 238.80. It is also a key reversal bottom. That tells us the market is trying to change trend. This sell-off could be very important in the sense that if it confirms that bottom, a strong buy should be setting up. Watching closely. Closed 245.30, down 5.20.
Position: Long 264.10 (11.26). Exit 259.50 (11.28). Loss $460.
JAN BEAN OIL: I attempted to buy it yesterday. It sold off instead and continued selling off today. The contract low is 30.25. The 30.00 level is long term support. Just watching. Closed 30.77, down 63.
MEAT COMMENTS:DEC HOGS: (Correction: in my last Update I showed being long hogs from 45.12. That was obviously a typo). They rallied to 59.70 on Friday and did not reach my 60.00 objective. I took profit close to the close today. They look like they will test 57.50 at least. This has been a very long trade and I'll wait for another opportunity. Closed 58.72, down 22.
Position: Long 56.12 (11.12). Exit 58.45 (12.2). Profit $932.
SOFTS COMMENTS:
MAR COTTON: It triggered a buy on Friday and rallied to 48.00. It sold off yesterday and today and may be testing the 45.00 support area. Move stops up from 43.70 to 45.95. Closed 46.33, down 94.
Position: Long 46.62 (11.28).
Projection: 50.00.
JAN ORANGE JUICE: What a pathetic market. I just keeps drifting lower. Just watching. Closed 72.10, up 70.
MAR COFFEE: It triggered a buy last Wed (in my Update I said Dec. contract - that was a typo error). The stop was reached yesterday. It has continued to sell off. The contract low is 110.10. Today's low 110.90. I see nothing to do here. Closed 111.90, down 2.00.
Position: Long 116.20 (11.26). Exit 113.25 (12.1). Loss $1106.25.
MAR COCOA: On Wednesday it went through my projection. I covered at 22.15. It sold off yesterday to 21.05 and appears to be holding at that support. A trade could be developing. See Trade Alert for details. Closed 21.69, up 5.
Position: Long 20.25 (11.18). Exit 22.15 (11.26). Profit $1900.
MAR SUGAR: I moved the stop to 11.62 for Monday and it was reached. For some reason sugar just can't get going. It gives a buy signal and then that fizzles out. At least it is attempting to hold the 11.50 support area. It still appears to be consolidating for a second major wave up except that the chart is kind of messy and trying to figure an entry point is difficult. I want to buy but need to wait. Closed 11.62, up 2.
Position: Long 11.97 (11.26). Exit 11.62 (12.1). Loss $392.
There is substantial risk of loss in trading futures and options. Past performance is not indicative of future results.
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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.
