TRADES FOR FRIDAY FRIDAY, JANUARY 15, 2013
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.
PLEASE NOTE: Next Monday is President's Day. On Friday equities, financials close early at 3:15. All other markets close their regular time. On Sunday night equites, financials & metals open only. They close early on Monday at 10:30, 12:00 & 12.15 respectively. On Monday nite grains open at 7:00, equities & financials at 5:00, metals 6:16. Softs normals. Meats do not open until 9:05 on Tuesday. I will not be in the office on Monday.
GRAIN UPDATE: They have continued to sell off in what appears to be another wave down in each market. Wheat has confirmed that since it has already taken out the previous contract low, the other grains have not yet. Corn and the bean complex are near some support but for the first time they all tend to have a cluster of resistances above the market to contend with.
I would not be surprised to see them rally near term but as I have pointed out for some time, they are in downtrends and the rallies should be near term only.
CATTLE: The sell off has been extensive in both cattle and feeders. As pointed out last month, the live cattle were suggesting a major correction because of the key reversal top they formed on the monthly chart. That has followed through. The monthly triggered a sell this month and that should suggest more sell off comparable to what they have consistently done early each new year since the bull move started in late 2009. This sell off could eventually go to at least 122.00.
The feeder cattle suggest further selling too even though they are grossly oversold now. Based on the monthly chart they could eventually reach the 133.50 area.
RECEIVE THE UPDATE VIA EMAIL: The Update you view in the Internet or our site for traders, www.markethead.com, is not the complete Update. It does not include comments/trades on alternate days. To sign up for the complete version visit my website: http://www.tradingfuturesmarkets.com/ and register. I also offer free trading booklets too!
GOAL OF THE MARKET UPDATE: The purpose of the Update is to acquaint you with the technical aspects of markets and trading. What I convey to readers is not my personal opinion but what the markets are suggesting by their technical formations and action. I do the technical analysis that most of you do not have the time for. The Update is also designed to help you learn about the markets and trading. It is also a tool and guide for those who want to compare it with their own work.
OTHER SERVICES I OFFER: In addition to the Update I also offer brokerage services. My clients range from self service to full service with the appropriate commission rate applied.
TRADING THOUGHTS TO REMEMBER:
The odds of picking a top or bottom are 1 in 200. That is why you use probabilities to guide you.
EMOTION is your enemy more than any market will ever be.
IMPORTANT NOTES RE TRADE ALERTS: My trades are normally entered on buy or sell signals. I do not enter new positions during the night session. If the potential trade is not reached during the day session, the trade is not initiated. Computation of costs includes commission plus estimated exchange fees.
TRADE ALERTS: None for Friday.
CHANGE IN OPEN STOPS:
Long March orange juice from 119.10 up to 128.50.
Short March feeders from 145.50 down to 143.00.
MAY CORN: It sold off to 685 1/2 yesterday but held that low today. It may try to rally but it will run into resistance around 700 to 707. Keep stops at 713 3/4. Closed 692 3/4, down 3/4.
Position: Short 694 3/4 (2.12).
MAR MINI WHEAT: It made a low yesterday at 730 3/4. It held that low today. Keep stops at 772. Closed 732, down 3 1/2.
Position: Short 790 1/4 (12.20).
MAR MINI BEANS: They made a low yesterday at 1404 1/2. They held that low today. Keep stops at 1465. Closed 1418, down 5.
Position: Short 1425 (2.12).
MAR MEAL: It made a new low today at 402.70. Watching closely to short. Closed 407.20, down .90.
MAR BEAN OIL: It has been attempting to hold at the 100 dma on the daily chart. It has heavy resistance directly above it at 52.50 to 52.60. Watching closely to short. Closed 51.70, up .04.
APR HOGS: In Tuesday's report I suggested the potential for a rally. Fat chance! They broke out of that consolidation to the downside. On the monthly they are forming a reversal top and are now back under both the 20 & 10 dma. That is negative. The monthly suggests the start of another major wave down. If that be the case we should eventually see 75.00 hogs. On the weekly chart they formed a reversal top last week when they attempted to get over the 100 dma and failed. They triggered a sell this week and failed the 10 dma. I missed this selling opportunity but, if they possibly rally it should be to short. Watching closely. Closed 84.32, down 1.47.
APR CATTLE: They triggered a sell today from an inside day on the daily chart, sold off to 127.60 and then rallied. I pointed out the possibility of a near term top in this market last month when the monthly was forming a key reversal top. I pointed out that they tend to do this in the early part of the year. That has followed through. They reached the 10 dma on the monthly chart and I suspect that is possibly the reason for the rallied today. Irrespective there should be more to this sell off. The monthly chart still suggests 122.00 cattle at least. Closed 129.77, up .37.
MAR FEEDERS: They sold off to 139.17 today on the daily chart and then finally rallied. Needless to say the damage done on the long term charts is racking up. They are back under the 100 dma on the weekly. On the monthly chart they are under both the 20 & 10 dma. They have done this before, specifically in July and recovered. Will they do so this time? Unlike in July on the monthly chart, this time they have both the 20 & 10 dma intersecting up at 147.00. That is a double resistance. That was not the case in July. Bottom line the chart suggests potential for more sell off. Move stops from 145.50 down to 143.00. Closed 142.67, up 1.32.
Position: Short 148.25 (2.6).
MAY COTTON: It is attempting to hold the 82.00 area. It sold off to 81.35 yesterday but held at the 20 dma and rallied back over 82.00. It has not had much of a correction since the 83.50 high. This consolidation could be setting up for a more extensive sell off. That would be healthy for the market. At this point it is wait and see. Closed 82.79, up .58.
MAR ORANGE JUICE: It continues to rally with a high today at 130.85. Move stops up from 119.10 to 128.50. Closed 130.65, up .95.
Position: Long 124.05 (2.8).
MAY COFFEE: Another new low at 140.10. It is pushing into some support formed in March 2010 on the weekly chart. That support goes down to 130.00. This could cause a slow down in the sell off and a potential rally?? Either way, long term there should be more sell off. Just watching. Closed 140.75, down .85.
MAY COCOA: Not much new here. It continues to be weak. Long term the monthly chart still suggests 20.00. Not enough going on to suggest a short. Closed 21.56, down .14.
MAY SUGAR: It finally triggered a sell today and sold off to 17.76. Keep stops at 18.30. Closed 17.77, down .50.
Position: Short 17.88 (3.14).
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.
Futures, options and forex trading is speculative in nature and involves substantial risk of loss. These recommendations are a solicitation for entering into derivatives transactions. All known news and events have been factored into the price of the underlying derivatives discussed. From time to time persons affiliated with Zaner, or its associated companies, may have positions in recommended and other derivatives.