The Trading Pit
40 replies to this topic
Posted 22 March 2005 - 12:01 AM
Thanks for all the great charts. Appreciate all the fine work.
Posted 22 March 2005 - 08:52 PM
Massive server/puter/data feed issues. Was supposed to be fixed today, now the word is tomorrow. Totally and completely fubar.
Site has not been updated. Typing this on an old jerry-rigged MAC I pulled out of the closet.
If you are playing along at home... Move stops down on the Euro short to a trailing 100 point stop. the Swiss Franc to break even and then trail it by 100...
Gold stop to breakeven
Gold options stop to 430 ($10)
Silver stop to 7.10
Oil and Hogs are fine.
Looking like it's getting to close to time to jump back into beans and cotton on the long side. Charts tomorrow.
Posted 23 March 2005 - 11:54 PM
And we're finally back.
Russell 2000 e-mini. Nice down day, relative weakness compared to the other indicies. Not surprisingly, price stopped right at the 150 day moving average. Have to see if that's real support or just a mirage.
Weekly chart suggests that if we don't get a bounce from here, 593 and then 560 are the next targets before a bounce.
US Dollar. Strong up move. Looks like the interventionistas are starting early tonight. Still a ways away from overbought. 86 wouldn't be a surprise, nor would 89. Should see a pull back here soon (next week?) and that will tell us a lot about this up move. Basically, the Dollar had no choice but to rally. Any further decline and the exodus of foreign investors from the stock and bond markets would have turned from an orderly exit to a stampede. The Dollar will revisit and eventually take out the recent lows, but probably not before a pretty sizable rally and most likely not until next year sometime. But if we're wrong and this rally fizzles, we'll be the first in line to start scooping up Gold and Silver.
Gold. Price stopped right where one would expect. If this is just a correction of the recent rally, then we would expect to go up from here. But if this a bigger down move, 425 won't hold for long.
Weekly chart. Full on sell signal, suggesting more down. Possible targets, 419, 400 and if the US Dollar index get back close to 90, Gold could see 370 or so.
The site is back up and updated.
p.s. Bonds look due for a bounce...
Posted 27 March 2005 - 11:09 PM
Hope everyone had a nice break.
Russell 2000 e-mini. Price bounced off the 150 dema and then ran up to tag short term resistance. Indicators suggest a short term bounce is possible...
But the weekly close below the 21 ema suggests more down is on the way. Expect a spirited defense of the big round number and some moving average support around 600.
US Dollar. Getting a little extended. Right at some longer term resistance. Pull back likely. Flash forward a few hours from when I wrote that... as of 8:30 pm est, dollar pushing above resistance. They're not wasting any time tonight.
Weekly chart. This makes it look like the rally has more to run. 86 on the index would not be surprising, but not without some backing and filling around the 21 ema (83.65) first. As long as price holds above 83.20 or so, the trend is still up. Right now (on Sunday evening) bumping against som important weekly resistance.
Soybeans. So far, the 21 ema has held. Longer term, they're still in an uptrend. There should be one more leg up. Buy May futures (6 contracts, 10 cent stop from where you get in) only if price is at or above 638.
There's more new stuff and some possible hedge trades as well here...
Posted 29 March 2005 - 12:55 AM
Russell 2000 e-mini. Very weak day. Indicators turning up slightly but the inability of price to get above the short term moving average suggests more down.
US Dollar. Getting smacked around pretty good on Monday night, giving up almost all of Monday's gains. We said yesterday is was looking a little extended, so it's not surprising it's coming in some. That's also why we've recommened the Euro call option hedge trade. We think there's more up here so we're going to try and ride out the correction. A trip back to 83 before the next (anticipated) leg up wouldn't be out of the ordinary. It could also just sort of hang around 84 for a while until the moving averages catch up.
And yes, it could collapse... that's what the hedge is for...
Cotton. Nice up move. Moved stop to break even. It looks like this up could be for real, fundamental demand is picking up. If that holds up, prices above 60.00 are probable.
Live Cattle looking like more up.
Posted 30 March 2005 - 01:53 AM
Russell 2000 e-mini. Nice down day. Possible double bottom with the January lows. Also the 200 day ema. 3 possibilities. 1 - sharp bounce back to the 21 ema. 2 - consolidation as it bounces between the long term moving averages while price decides what to do or 3 - price crashes through 600 (some medium term weekly support at 590) and there's nothing but air until 560. Based on the daily, door number 2 seems the most likely...
But based on the weekly door number 3 seems the better choice. Nothing says cover. Nothing. It looks like the down is just getting started.
Silver. So far just a bounce back to tag the short term moving average. Indicators on the daily are turning up, but the weekly trend is still down. Usually that means the up won't get far.
Silver weekly. Down has some room. All going to depend on the US Dollar.
US Dollar. Still above most of the moving averages. Indicators turning down but no sell signal yet. A correction here would be expected. A trip back to 83 or so would not violate the uptrend.
Cotton. Expected pull back after two strong up days. The talk of the Chinese buying large quantities turned down a notch. Supposedly, one large Commercial is done covering shorts. The stop is at break even if this rally was just a head fake.
Posted 31 March 2005 - 12:34 AM
Russell 2000 E-mini. Well not quite door number 1, much more like door number 2, although it was a pretty spirited rally. Facing some pretty stiff resistance here so we'll have to give a bit to see what happens. If it's going further, more than likely it will be a bounce back to the 21 ema, if that.
Silver. Pretty good bounce back to the intermediate term moving average. Normally, we'd be looking to buy this above 7.20. But...
...Silver weekly. Right back to the short term moving average. Still on a sell signal.
And the US Dollar still looks like up. So far, all it did was come back and tag the short term moving average and then bounce. The trend is still up. So unless Silver has decoupled from the Dollar up/Silver down relationship (and we'll be the first to admit it's possible), the rally in Silver the last two days could be a trap. We'll know by Thursday.
Looking to add some Soybean Meal.
And some Coffee if it hit's the target.
Details here and more...
Posted 01 April 2005 - 02:07 AM
Soybeans (and Meal). Panic selling in the last 15 minutes in the pits took Soybeans down close to 25 points. The range on Thursday was nearly 40 points. Wild, volatile day. Both trades were working great up until the last 15 minutes and then we got smoked. It may have been end of quarter book squaring or it may mean this latest rally was nothing more than the funds driving price past fundmantal reality. We're think it's the second choice. Unless you're daytrading off a tick chart or in the pit, these kinds of moves are always going to kill you. Here's the 15 minute chart.
So we're going to flip-flop and sell some if price trades below 625.
Russell 2000 E-mini. Relatively flat day so all the small cap funds could get a decent quarter end print. Friday/Monday will reveal the direction price really wants to go in. We're still thinking down.
This will finally resolve one way or another on Friday. Still think up, but ready to buy a boat load of Euro calls if need be.
Unleaded Gas. Should be more up. Looks like it's about to parabolic.
More here and the possible hedges...
Posted 04 April 2005 - 12:25 AM
Russell 2000 e-mini. Looks weak. Ran up to tag the 21 ema and failed.
E-mini weekly. Still lots of room to fall.
A side note. The Insurance Index. We've always thought that this index is the carnary in the coal mine for the broader indicies. It tends to lead up and down. The stocks in this index are probably the most sensitive to future economic conditions. Of course, AIG isn't helping. But it looks like the canary died even before the AIG mess really got some traction. This is one ugly chart. Nothing but down since February. This portends more down for the broader market.
Euro. Targets are 1.27, 1.26 and 1.24. The spike on the Friday jobs number tagged the hedge trade trigger and then of course, price turned and went the other way. It cost a few bucks (about 5,000), but if it hadn't been for the hedge, we'd be out of the trade completely. And for now, short looks like the way to be.
Gold. If the count shown below is correct, price is about to start a third wave (of C) down. If so, the decline could be breathtaking.
Gold weekly. Targets here are slightly lower. 420, 401 and 370. The lower targets would give the Dollar a chance to finish its rally. Eventually, the Dollar will decline and Gold and Silver will rally. Just doesn't look like yet.
Crude Oil. The price advance stopped right at the previous contract high. It could be a double top or it could be getting ready to bust towards 60 (or higher). Indicators suggest more up is in store, although a pull back here wouldn't be surprising. That is a fresh buy signal and a strong one to boot. Up a few cents in the access market.
Soybeans. Down day as expected. Looks like more down.
Posted 05 April 2005 - 12:33 AM
Russell 2000 e-mini. Added 4 more contracts to the short position and price promptly rallied. After Friday's failure, Monday should have been down. But it wasn't. Stop is now at 622 for all 8 which is break even. Any rally shouldn't get far, probably just past our stop.
Silver. Interesting that Silver was able to finish positive despite the Dollar being up. So far, it's just a run back to the short term moving average. Have to see what happens if it gets back to the moving average cluster around 7.16
Unleaded Gas. Probably not going to go far until the inventory report on Wednesday. How price reacts on Tuesday will determine if we want to hold this position throught that or not. Same for Crude.
Coffee. Short futures trade was triggered, now slightly underwater. May just take a couple of tries to get below the 55 ema.
Posted 05 April 2005 - 10:39 PM
Russell 2000 e-mini. Relative weakness today but very close to a buy signal on the daily.
But on the weekly, still a solid sell signal and below the short and intermediate term moving averages. There shouldn't be much more up.
Silver. Also close to a buy signal...
US Dollar. Despite Tuesday's sell-off, everything still pointed flat to up. The failure at 85 is a little worrisome (for our positions) but in the overnight session, it looks like it's making another run for it. (flash forward an hour and it's now flat) We've tightened up the stops on Gold, Silver and the currency trades.
Unleaded Gas. Looks like another exhaustion spike. Now down a good chunk in the overnight market. It may just want to go back and tag the short term moving average. If it wants to go further, it will go without us.
Someday I'll get this trade right...
Posted 07 April 2005 - 12:20 AM
Been a rough couple of weeks, a lot of trades going the wrong way. But it looks like that's turning around.
US Dollar. Basically do or die time. Any significant decline here and new lows are on the way.
Crude Oil. If it can't get back above 57 by Thursday and trades below 55.65, we're in for a pretty good correction. That's a sell signal with a negative divergance.
Live Cattle. Breaking the 55 ema should give us some faster down.
Looks like the Soybean correction is over.
And the Russell could go either way. Kinda looks like up.
Posted 11 April 2005 - 01:57 AM
For Monday 4/11
US Dollar. Looks like a correction is coming. Our stops on the Euro and Swiss Franc will most likely get hit on Monday. The important thing to see is if it's the end of the Dollar rally or just a pause. Back below 84 is trouble for the Dollar, under 83.50 probably means new lows.
Crude Oil. Hit a logical bounce point on Friday. But it looks like the correction is going to continue for a while. Moved stop to break even.
Russell 2000 E-mini. Down from the get-go on Friday. Hedge trade was triggered. Stops are in place. If the trend has resumed down, 600 won't hold.
Silver. Now short March and long July. It's all about the Dollar and which stop get hit first. This chart is suggesting the Dollar rally is over for a while. Above 7.20 would pretty much seal it. That would get you 732-5 in a heartbeat and then 7.45-50 soon after. It's all about the Dollar.
Looks like it's time to short some beans...
and some T-bones...
Posted 12 April 2005 - 01:02 AM
For Tuesday 4/12/05
Silver. Nice break above the 50 ema. Need the dollar to break down here for this to continue. Ready to hedge if need be.
US Dollar. Teetering on the edge. The trade deficit release on Tuesday will tell the tale for the near term. A sell signal and only 25 ticks away from the 21 ema. Not a good combination. Everybody is waitng on the trade deficit numbers.
Russell 2000 E-mini. Broke below last week's low, which is also the January low and then bounced a bit. Couldn't get past the 150 day moving average. Should be more down.
Cotton. Above all resistance, should be more up.
Posted 13 April 2005 - 02:44 AM
Crude Oil. Down another half a buck in the access market. Should get a pause/bounce around 52.80. If that doesn't hold, 50 dollars is on tap.
US Dollar. Looking like Tuesday was all about news noise reaction. If so, then it shouldn't be long until price heads back towards the 21 ema. If price was going up, it should have closed near the highs. It didn't, in fact it closed below the short term moving average. Intervention is a funny thing. We'll have to see what the interventionistas have in store for Wednesday. It looks like down.
Russell 2000 e-mini. Who would have thought the FOMC minutes could ignite such a short squeeze. Now, right back at short term resistance. Futures flat overnight. All going to depend if there's any follow through on Wednesday.
Ten Year Note. Not buying this bond rally. Could be wrong, but something just isn't right. Bonds rally big because the next FOMC rate hike is only going to be .25 instead of .50? Hello. We're still in a rising rate cycle. Yield curve is flattening. Or were Tuesday's minutes the super-secret handshake signal that liquidity will still abound and the punch bowl is still on the table. Or was it that some big hedge funds got caught leaning the wrong way. If that's the case, this rocket will fizzle quicky. We'll see.
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