THE JOSS REPORT 10/08/2006
Available Exclusively Through ClearTrade Commodities
ClearTrade®
Subscribe to The Joss Report:
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- TECH TALK
1) COCOA
2) SWISS FRANC
3) BRITISH POUND
4) COFFEE
5) SOYBEANS
6) GOLD
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- CHART WATCH
7) LIVE CATTLE
8) SUGAR
9) CRUDE OIL
10) TEN YEAR NOTE
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- CURRENT 'MONTHLY' RECOMMENDATION
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- FUTURES WATCH
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WELCOME TO THE JOSS REPORT - WEEKLY TRADE ADVISOR
The Joss Report trading recommendations and weekly trade advisor was first published in October 1998. Since that time, the Joss Report research has continued to evolve into an important source of technical insight for many traders. Our goal is to provide traders with a 'trading plan' to prepare for the trading day and week ahead.
ClearTrade's own technical analyst, Scott Joss*, is a veteran futures trader with twenty-eight years experience on and off the trading floor - as a technical analyst, pit trader, account executive handling arbitrage for Smith Barney, former member of the CBOT, non-member CTA and presently an IB. Scott prepares technical analysis in selected market groups when an opportunity presents itself and not only develops 'trading modules' on selected trading opportunities but 'feeds-forward', advising traders what to expect and how to react.
ClearTrade® Contact Phone Numbers
800-493-4444
773-561-9777
http://www.cleartrade.com
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The Joss Report Archived Weekly Trade Advisor 2006
http://www.cleartrade.com/?pageid=41737
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- TECH TALK BY Scott R. Joss (Non member C.T.A)*
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DECEMBER COCOA (CCZ6)
Last week I added December Cocoa to ‘Chart Watch’ due to a trade signal for last week.
On 9/18/06, December Cocoa posted an unconfirmed yearly sell signal at 1437.
On 9/21/06, December Cocoa posted a buy signal at 1505.
On 9/25/06, December Cocoa posted a sell signal at 1484.
On 10/03/06, December Cocoa posted a sell signal at 1448.
December Cocoa has two unfilled price gaps above the current market price. The most recent unfilled price gap is between 1562 and 1572 (8/18/06).
The long-term weekly and monthly chart has developed a three-year bearish descending right triangle. Recently, Cocoa had a price advance pushing through the descending trendline.
However, in recent weeks Cocoa had a price decline challenging its upside breakout.
On the daily chart December Cocoa has developed a bearish ‘descending’ right triangle.
The ‘descending’ trendline began from highs of 1767 (7/11/06) through 1534 (9/22/06) and 1491 (10/05/06).
Technically, December Cocoa would need to have multiple closes below October Cocoa’s low of 1410 to see an accelerated price decline.
This product is not for the faint of heart because of the higher or lower openings each day - which can be dramatic.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week increased by 6,132, posting a total open interest of 146,930 contracts.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk will be $1,220.
Traders are advised to begin consulting with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
The trading modules listed below are for very aggressive traders. Less aggressive traders are advised to wait for several trade signals before establishing a position.
# 1) If December Cocoa posts 1511, and multiple closes above 1535****:
Very aggressive traders are advised to establish a long position, placing all stops at 1448 and refer to trading module # 5*.
# 2) If December Cocoa posts multiple closes above 1550****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 1510*.
Our objective will be 1572.
# 3) If December Cocoa posts multiple closes above 1600****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 1535*.
# 4) If December Cocoa posts multiple closes above 1615****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 1562*.
Our objective will be 1729.
# 5) If December Cocoa posts 1434 and multiple closes below 1410****:
Very aggressive traders are advised to establish a short position, placing stops at 1511 and refer to ‘trading module’ # 1*.
# 6) If December Cocoa posts multiple closes below 1390****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 1449*.
# 7) If December Cocoa posts multiple closes below 1315****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 1415*.
Our objective will be 1316.
# 8) If December Cocoa posts multiple closes below 1299****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 1415*.
Our objective will be 1299.
# 9) If December Cocoa does not post lows of 1414 or highs of 1536 in October:
Aggressive traders will be advised of a new set of ‘trading modules’ in the November 4th issue of The Joss Report.
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DECEMBER SWISS FRANC (SFZ6)
In the Joss Report dated 9/10/06, I began discussing the December Swiss Franc because of several trade signals.
Last week I explained that due to these trade signals, the December Swiss Franc became a ‘top trade.’
I also explained in that issue that the December U.S. Dollar had a trade signal. Traders were reminded that the Dollar moves opposite the Swiss Franc.
On 9/06/06, the December Swiss Franc posted a sell signal at .8159.
On 9/07/06, the December Swiss Franc posted an unconfirmed sell signal at .8140.
On 9/07/06, the December U.S. Dollar posted a buy signal at .8497.
On 9/15/06, The December Swiss Franc posted a low of .7995; traders were advised to exit their short positions.
On 9/29/06, the December Swiss Franc posted a confirmed sell signal at .8140.
On 10/04/06, the December Swiss Franc posted a sell signal at .8080.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week increased by 2,710, posting a total open interest of 72,687 contracts.
This product is for aggressive traders only.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk is $1,925.
If you do not fit this risk profile, traders are advised to consult with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
Aggressive traders who established a short position at .8080 are advised to move their stops above .8140*.
# 1) If the December Swiss posts multiple closes below .7995****:
Aggressive traders are advised to establish a short position, placing stops above .8080.
# 2) If the December Swiss posts multiple closes below .7885:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above .7995*.
# 3) If the December Swiss posts multiple closes below .7851:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above .7995*.
# 4) If the December Swiss posts multiple closes below .7823:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above .7967*.
Our objective will be .7777.
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DECEMBER BRITISH POUND (BPZ6)
This week I’m adding the December British Pound to ‘Tech Talk’ due to a trade signal for next week - and possibly next month.
On 9/28/06, the December Pound posted an unconfirmed sell signal at 1.8755.
The December Pound has been in a five-week consolidation between 1.9116 (8/31/06) highs and 1.8627 lows (9/11/06).
This product is not for the faint of heart because of the nature of its trading personality - which can be dramatic.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week decreased by -17,457, posting a total open interest of 104,665 contracts.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk next week will be $1,425.
Traders are advised to begin consulting with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
The trading modules listed below are for very aggressive traders. Less aggressive traders are advised to wait for several trade signals before establishing a position.
# 1) If the December Pound posts 1.8914 and multiple closes above 1.8930****:
Very aggressive traders are advised to establish a long position, placing all stops at 1.8686 and refer to trading module #5*.
# 2) If the December Pound posts multiple closes above 1.8975****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing stops at 1.8686*.
# 3) If the December Pound posts multiple closes above 1.9044****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 1.8913*.
# 4) If the December Pound posts 1.9090 and multiple closes above 1.9103****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 1.8942*.
Our objective will be 1.9142.
# 5) If the December Pound posts 1.8686 and multiple closes below 1.8627****:
Very aggressive traders are advised to establish a short position, placing stops at 1.8914 and refer to ‘trading module’ # 1*.
# 6) If the December Pound posts multiple closes below 1.8585****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing stops above 1.8914*.
Our objective will be 1.8458.
# 7) If the December Pound posts multiple closes below 1.8447****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 1.8686*.
# 8) If the December Pound posts multiple closes below 1.8300****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 1.8447*.
# 9) If the December Pound posts multiple closes below 1.8248****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 1.8447*.
Our objective will be 1.8168.
# 10) If the December Pound does not post lows of 1.8626 or highs of 1.9104 in October:
Aggressive traders will be advised of a new set of ‘trading modules’ in the November 4th issue of The Joss Report.
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DECEMBER COFFEE (KCZ6)
This week I am adding December Coffee to ‘Tech Talk’ due to a trade signal for next week and possibly next month.
On 9/08/06, December Coffee posted a sell signal at 105.35.
On 7/28/06 and 9/18/06, December Coffee posted a potential ‘double’ bottom (divergence) at 101.40 and 101.00 respectively.
This product is not for the faint of heart because of the nature of its trading personality, which can be very dramatic.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week increased by 5,067, posting a total open interest of 110,868 contracts.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk next week will be $2,062.50.
Traders are advised to begin consulting with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
The trading modules listed below are for very aggressive traders. Less aggressive traders are advised to wait for several trade signals before establishing a position.
# 1) If December Coffee post 107.95 and multiple closes above 108.60****:
Very aggressive traders are advised to establish a long position, placing all stops at 102.45 and refer to trading module # 4*.
# 2) If December Coffee posts multiple closes above 110.20****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing stops below 106.25*.
# 3) If December Coffee posts multiple closes above 111.20****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 107.95*.
Our objective will be 113.45.
# 4) If December Coffee posts 102.45 and multiple closes below 102.00****:
Very aggressive traders are advised to establish a short position, placing stops at 107.95 and refer to ‘trading module’ # 1*.
# 5) If December Coffee posts multiple closes below 101.00****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing stops above 1.8914*.
# 6) If December Coffee posts multiple closes below 100.50****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 102.45*.
# 7) If December Coffee posts multiple closes below 99.75****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 102.45*.
# 8) If December Coffee posts multiple closes below 98.00****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 100.00*.
Our objective will be 96.95.
# 9) If December Coffee does not post lows of 100.95 or highs of 111.25 in October:
Aggressive traders will be advised of a new set of ‘trading modules’ in the November 4th issue of The Joss Report.
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JANUARY SOYBEANS (SF6)
This week I’m adding January Soybeans to ‘Chart Watch’ due to a potential breakout trade signal last week at 577.00.
Long-term readers know that Soybeans posted a sell signal on 7/14/06 at 628.25 and haven’t looked back since. However, due to a possible breakout trade signal last week, I feel an obligation to bring the following information to traders’ attention.
January Soybeans have been in a five-week consolidation between lows of 550.00 (9/13/06) and highs of 577.00 (8/25/06 and 10/04/06).
This product is not for the faint of heart because of the higher or lower openings each day - which can be dramatic.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week increased by 12,458, posting a total open interest of 379,185 contracts.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk will be $1,375.
Traders are advised to begin consulting with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
The trading modules listed below are for very aggressive traders. Less aggressive traders are advised to wait for several trade signals before establishing a position.
# 1) If January Soybeans post a price pullback to 563.50:
Very aggressive traders are advised to establish a long position, placing all stops at 549.75 and refer to trading module # 7*.
Option traders are advised to purchase January 580 calls, risking 70% of purchase price**.
# 2) If January Soybeans post multiple closes above 577.00****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops at 549.75 and refer to trading module # 7*.
Option traders are advised to purchase January 580 calls, risking 70% of purchase price**.
# 3) If January Soybeans post 582.00 and multiple closes above 585.25****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 563.50*.
Option traders are advised to purchase January 600 calls, risking 70% of purchase price**.
# 4) If January Soybeans post 591.00 and multiple closes above 596.00****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 577.00*.
Option traders are advised to purchase January 620 calls, risking 70% of purchase price**.
Our objective will be 606.00.
# 5) If January Soybeans post multiple closes above 614.00****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 591.00*.
Option traders are advised to purchase January 640 calls, risking 70% of purchased price**.
# 6) If January Soybeans post multiple closes above 619.50****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 596.00*.
Option traders are advised to purchase January 640 calls, risking 70% of purchased price **.
Our objective will be 626.00.
# 7) If January Soybeans post multiple closes below 549.75****:
Very aggressive traders are advised to establish a short position, placing stops at 577.25 and refer to ‘trading module’ # 1*.
Option traders are advised to sit on the sidelines and wait.
# 8) If January Soybeans post 540.50 and multiple closes below 539.50****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 563.50*.
Our objective will be 526.50.
# 9) If January Soybeans post multiple closes below 526.00****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 550.00*.
# 10) If January Soybeans post multiple closes below 512.50****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 539.50*.
Our objective will be 498.50.
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DECEMBER GOLD (GCZ6)
In the Joss Report dated 8/27/06, I began discussing December Gold because of a pending monthly trade signal.
Between 9/5/06 and 9/6/06, December Gold posted a bearish ‘Island reversal’ top.
Three weeks ago I advised traders that December Gold had developed a possible bearish descending right triangle.
I also advised that if formation came to fruition, our objective will be 547.00.
On 8/28/06, December Gold posted a sell signal at 627.40.
On 9/07/06, December Gold posted a sell signal at 640.90.
On 9/08/06, December Gold posted an unconfirmed sell signal at 615.40.
On 9/26/06, December Gold posted a buy signal at 598.10.
Between 9/28/06 and 10/02/06, December Gold posted a second bearish ‘Island Reversal’ top.
On 9/29/06, December Gold posted a confirmed sell signal at 615.40.
Last week I stated that ‘as long as December Gold remains below 615.40, downside pressure will continue.’
Major resistance is at 615.40.
Minor resistance is at 598.10.
December Gold has several unfilled price gaps below the current market price. The most recent is between lows of 563.00 and highs of 563.50 (3/13/06).
December Gold has three unfilled price gaps above the current market price. The most recent price gap is between 595.00 and 602.00.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week increased by 7,128, posting a total open interest of 330,065 contracts.
This product is for very aggressive traders only.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk for this week is $3,810.
If you do not fit this risk profile, traders were and are advised to consult with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
For September, December Gold posted a key sell signal at 615.40.
Aggressive traders who established a short position at 611.00 on 9/28/06 against the 613.50 gap are advised to move stops to 602.00*.
Option traders who purchased 580 puts are advised to risk 30% of market value**.
Aggressive traders who either added to their existing short position or established a short position on the ‘Island Reversal’ gap at 595.00 or below are advised to move stops for this position only above 598.10*.
Option traders who purchased 570 puts are advised to risk 30% of market value**.
# 1) If December Gold posts multiple closes below 576.00****:
Aggressive traders are advised to establish a short position, placing all stops above 598.10*.
Option traders are advised to purchase December 570 puts, risking 70% of purchase price**.
# 2) If December Gold posts a close below 565.10 and multiple closes below 563.50****:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 576.60*.
Option traders are advised to purchase December 560 puts, risking 70% of purchase price**.
# 3) If December Gold posts multiple closes below 555.60****:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 576.60*.
Option traders are advised to purchase December 550 puts, risking 70% of purchase price**.
Our objective will be 541.60.
* (Futures traders and their account executives are advised to discuss this suggested stop).
** (Option traders and their account executives are advised to discuss the suggested risk).
*** (Traders can exit or hedge a trade position once it moves in their direction but are advised to remove all resting stop orders).
**** (Very aggressive Traders can enter a trade position without multiple closes but are advised to use resting stop orders).
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CHART WATCH by Scott R. Joss (Non member C.T.A)*
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Chart Watch includes markets developing a 'trade signal' or a chart pattern that has not yet fully developed - or may never develop.
During the course of the week or month it is not uncommon to find an `intra-day, intra-week or intra-month' recommendation that was previously not revealed when this newsletter was written.
Products that currently fit into this 'watch' category are listed below and should be 'watched.'
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DECEMBER LIVE CATTLE (LCZ6)
Last week, I added December Live Cattle to ‘Chart Watch’ due to a trade signal.
In addition Long-term readers know that the meats are not my favorite product to technically track due to their unpredictability.
This product is not for the faint of heart because of the higher or lower openings each day, which can be dramatic.
December Live Cattle will remain on ‘Chart Watch’ this week because of a complex ‘broadening formation’ on the daily chart.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week increased by 3,830, posting a total open interest of 221,700 contracts.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk for next week will be $1,088.
Traders are advised to begin consulting with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
The trading modules listed below are for very aggressive traders. Less aggressive traders are advised to wait for several trade signals before establishing a position.
# 1) If December Live Cattle posts 90.55, and multiple closes above 91.20****:
Very aggressive traders are advised to establish a long position, placing all stops at 89.15 and refer to trading module # 4*.
# 2) If December Live Cattle posts multiple closes above 92.30****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 90.50*.
Our objective will be 93.10.
# 3) If December Live Cattle posts multiple closes above 94.00****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 91.10*.
Our objective will be 99.35.
# 4) If December Live Cattle posts 89.17 and multiple closes below 88.55****:
Very aggressive traders are advised to establish a short position, placing stops at 90.55 and refer to ‘trading module’ # 1*.
# 5) If December Live Cattle posts 87.85 and multiple closes below 87.65****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 88.55*.
# 6) If December Live Cattle posts multiple closes below 86.30****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 87.65*.
Our objective will be 83.15.
# 7) If December Live Cattle does not post lows of 88.55 or highs of 94.00 in October:
Aggressive traders will be advised of a new set of ‘trading modules’ in the November 4th issue of The Joss Report.
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MARCH SUGAR (SBH6)
For the last twenty-four weeks I have developed and written ‘trading modules’ based on Sugar’s weekly and monthly sell signals.
The first such monthly sell signal occurred last May based on the July 2006 contract at 16.57. This key monthly sell signal at 16.57 has had the power to drive current prices to lows of 10.66 verses the March 2007 contract.
This week I’m moving Sugar to ‘Chart Watch’ because of the decreasing open interest – and not because of a technical change in trend… yet.
Last week I asked if this downward momentum might continue.
I listed the two all important bullish ‘W’ formation breakouts from 2005.
The first key upside ‘W’ breakout was at 8.70.
The second key upside ‘W’ breakout occurred at 11.40.
March Sugar has an unfilled price gap below the current market price between lows of 9.55 and highs of 9.58 (8/30/05).
March Sugar has several unfilled price gaps above the current market price. The most recent price gap is between 11.29 and 11.30 (10/2/06).
Our first objective of 11.56 was met on 9/22/06.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week decreased by -40,494, posting a total open interest of 432,984 contracts.
This product is for aggressive traders only.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
Aggressive traders who established a short position below 12.15 and have not exited their positions are advised to place stops above 11.90 or exit their positions*.
Aggressive traders who either added to their existing short position or established a short position below 11.88 and have not exited their positions are advised to place stops above 11.90 or exit their positions*.
Aggressive traders who either added to their existing short position or established a short position below 11.47 and have not exited their positions are advised to place stops above 11.90 or exit their positions*.
Aggressive traders who either added to their existing short position or established a short position on a price advance towards 11.69 are advised to place stops above 11.90 or exit their positions*.
# 1) If March Sugar posts multiple closes below 10.66****:
Aggressive traders are advised to either add to their existing positions or re-establish a short position, placing all stops above 11.90*.
Option traders are advised to purchase March 1150 puts, risking 70% of purchase price**.
# 2) If March Sugar posts multiple closes below 10.40****:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing stops above 11.57*.
Option traders are advised to purchase March 1100 puts, risking 70% of purchase price**.
# 3) If March Sugar posts multiple closes below 10.15****:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing stops above 11.02*.
Option traders are advised to purchase March 1100 puts, risking 70% of purchase price**.
Our objective will be 9.70.
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NOVEMBER CRUDE OIL (CLX6)
In the Joss Report dated 9/17/06, I began developing ‘trading modules’ for November Crude Oil.
This week Crude will be posted in Chart Watch’ because of the fast approaching first notice day for November Crude Oil, open interest, and a key moving average at 58.54.
Between 8/07/06 and 8/09/06, November Crude Oil posted a bearish ‘island reversal’ top.
In addition, between 6/20/06 and 8/16/06, November Crude Oil developed a bearish ‘M’ formation.
The middle of the ‘M’ was at 74.50.
On 8/16/06, November Crude Oil posted a close below the all important ‘M’ formation.
On 8/17/06, November Crude Oil penetrated a seventeen-month trendline at 74.05.
On 9/6/06, November Crude Oil posted a close below last year’s high (for the November contract) of 68.95.
On 9/13/06, November Crude Oil penetrated a two-year trendline at 64.70.
This product is for very aggressive traders and not for the faint of heart.
Very aggressive traders were and continue to be advised not to exceed the rule of thumb - 10% of equity to risk ratio.
If you do not fit this risk profile, traders were and are advised to consult with their account executive for an option trading strategy.
Very aggressive traders looking to minimize risk continue to be advised to use the electronic miNY Crude Oil as their trading vehicle.
November Crude Oil has five unfilled price gaps above the current market price. The most recent unfilled price gap is between 70.20 and 70.25 (9/5/06).
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for Crude Oil futures last week increased by 24,792, posting a total open interest of 1,173,630 contracts.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for miNY Crude Oil futures last week increased by 9,005, posting a total open interest of 52,559 contracts.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
Very aggressive traders who established a short position at 62.80 or below are advised to move stops above 64.00 or exit their position*.
Very aggressive traders who established a short position at 61.00 or below are advised to move stops above 64.00 or exit their position*.
Very aggressive traders who established a short position on a price advance towards 63.50 are advised to move stops above 64.00 or exit their position*.
# 1) If November Crude posts multiple closes below 57.75****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 62.70*.
Our objective will be 57.02.
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DECEMBER 10-YEAR NOTE (TYZ6)
In the Joss Report dated 9/10/06, I added the December 10-Year Note to ‘Chart Watch.’
This week the December 10-year Note will again be moved from ‘Tech Talk’ to ‘Chart Watch’ because of last week’s reversal pattern, resistance at a key moving average of 108-200, and open interest.
On 8/16/06, the December 10-Year Note posted a buy signal at 106-200.
On 8/30/06, the December 10-Year Note posted a buy signal at 107-040.
On 9/14/06, the December 10-Year Note posted a buy signal at 107-150.
On 9/19/06, the December U.S. 30-Year Bond posted a buy signal at 111-05.
On 9/20/06, the December 10-Year Note posted a buy signal at 107-165.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for 10-Year Note futures last week increased by 43,744, posting a total open interest of 2,241,109 contracts.
This product is for very aggressive traders only.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
If you did not fit this risk profile, traders were and are advised to consult with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
Very aggressive traders who established a long position in the 10-Year Note at 106-200 or above are advised to leave stops below 107-160 or exit their position*.
Very aggressive traders who established a long position in the 10-Year Note at 107-040 or above are advised to leave stops below 107-160 or exit their position*.
Very aggressive traders who established a long position in the 10-Year Note at 107-150 or above are advised to leave stops below 107-160 or exit their position*.
Very aggressive traders who established a long position in the 10-Year Note at 107-165 or above are advised to leave stops below 107-160 or exit their position*.
Very aggressive traders who either added to their long position or established a long position at 107-290 or above are advised to leave stops below 107-160 or exit their position*.
* (Futures traders and their account executives are advised to discuss this suggested stop).
** (Option traders and their account executives are advised to discuss the suggested risk).
*** (Traders can exit or hedge a trade position once it moves in their direction but are advised to remove all resting stop orders).
**** (Very aggressive Traders can enter a trade position without multiple closes but are advised to use resting stop orders).
________________________________________
NOTE:
If you do not completely understand this information, you are advised to take NO action until speaking with your Account Executive.
ClearTrade®, Inc. may be reached at 800-493-4444
________________________________________
* The Joss Report trade recommendations and weekly trade advisor is prepared by Scott Joss, Non- Member C.T.A.
Scott Joss is a 'non member' CTA and is providing the Joss Report weekly trading advisor and trade recommendations to ClearTrade®, Inc. clients. Scott Joss 'is a principal' of ClearTrade, Inc. and 'is a registered IB member' with the NFA.
________________________________________
ClearTrade®, Inc.
5415 N. Sheridan Rd.
Suite 2104
Chicago, IL 60640
(800) 493-4444
(773) 561-9777 Voice
(773) 561-9775 Fax
Mailto:research@cleartrade.com
http://www.cleartrade.com/
________________________________________
DISCLAIMER:
Market recommendations are strictly the opinion of the writer and are intended solely for informative purposes and are not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Futures trading involve substantial risk. In no event should the content of a market letter be construed as a promise that you will profit or that losses can or will be limited in any manner whatsoever.
ClearTrade, Inc. does not necessarily promote or endorse the services or publications described herein. Unless otherwise indicated, ClearTrade Inc. has had no role in the production or review of these products or services and makes no warranty, either expressed or implied, as to their contents, accuracy or performance.
Past results are no indication of future performance. Information provided in this newsletter is intended solely for informative purposes and is obtained from sources believed to be reliable. Information is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted.
REPRODUCTION OR REBROADCAST OF ANY PORTION OF THIS INFORMATION IS STRICTLY PROHIBITED WITHOUT THE WRITTEN PERMISSION OF S.R. JOSS INC./CLEARTRADE®, INC.
The contents of this newsletter are copyright 1997-2005, Scott R. Joss/S.R. Joss Inc./ClearTrade ®,Inc. *TM. All Rights Reserved.
ClearTrade®
Subscribe to The Joss Report:
http://www.cleartrade.com/?pageid=30478
________________________________________
- TECH TALK
1) COCOA
2) SWISS FRANC
3) BRITISH POUND
4) COFFEE
5) SOYBEANS
6) GOLD
________________________________________
- CHART WATCH
7) LIVE CATTLE
8) SUGAR
9) CRUDE OIL
10) TEN YEAR NOTE
________________________________________
- CURRENT 'MONTHLY' RECOMMENDATION
________________________________________
- FUTURES WATCH
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WELCOME TO THE JOSS REPORT - WEEKLY TRADE ADVISOR
The Joss Report trading recommendations and weekly trade advisor was first published in October 1998. Since that time, the Joss Report research has continued to evolve into an important source of technical insight for many traders. Our goal is to provide traders with a 'trading plan' to prepare for the trading day and week ahead.
ClearTrade's own technical analyst, Scott Joss*, is a veteran futures trader with twenty-eight years experience on and off the trading floor - as a technical analyst, pit trader, account executive handling arbitrage for Smith Barney, former member of the CBOT, non-member CTA and presently an IB. Scott prepares technical analysis in selected market groups when an opportunity presents itself and not only develops 'trading modules' on selected trading opportunities but 'feeds-forward', advising traders what to expect and how to react.
ClearTrade® Contact Phone Numbers
800-493-4444
773-561-9777
http://www.cleartrade.com
________________________________________
The Joss Report Archived Weekly Trade Advisor 2006
http://www.cleartrade.com/?pageid=41737
________________________________________
- TECH TALK BY Scott R. Joss (Non member C.T.A)*
________________________________________
DECEMBER COCOA (CCZ6)
Last week I added December Cocoa to ‘Chart Watch’ due to a trade signal for last week.
On 9/18/06, December Cocoa posted an unconfirmed yearly sell signal at 1437.
On 9/21/06, December Cocoa posted a buy signal at 1505.
On 9/25/06, December Cocoa posted a sell signal at 1484.
On 10/03/06, December Cocoa posted a sell signal at 1448.
December Cocoa has two unfilled price gaps above the current market price. The most recent unfilled price gap is between 1562 and 1572 (8/18/06).
The long-term weekly and monthly chart has developed a three-year bearish descending right triangle. Recently, Cocoa had a price advance pushing through the descending trendline.
However, in recent weeks Cocoa had a price decline challenging its upside breakout.
On the daily chart December Cocoa has developed a bearish ‘descending’ right triangle.
The ‘descending’ trendline began from highs of 1767 (7/11/06) through 1534 (9/22/06) and 1491 (10/05/06).
Technically, December Cocoa would need to have multiple closes below October Cocoa’s low of 1410 to see an accelerated price decline.
This product is not for the faint of heart because of the higher or lower openings each day - which can be dramatic.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week increased by 6,132, posting a total open interest of 146,930 contracts.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk will be $1,220.
Traders are advised to begin consulting with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
The trading modules listed below are for very aggressive traders. Less aggressive traders are advised to wait for several trade signals before establishing a position.
# 1) If December Cocoa posts 1511, and multiple closes above 1535****:
Very aggressive traders are advised to establish a long position, placing all stops at 1448 and refer to trading module # 5*.
# 2) If December Cocoa posts multiple closes above 1550****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 1510*.
Our objective will be 1572.
# 3) If December Cocoa posts multiple closes above 1600****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 1535*.
# 4) If December Cocoa posts multiple closes above 1615****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 1562*.
Our objective will be 1729.
# 5) If December Cocoa posts 1434 and multiple closes below 1410****:
Very aggressive traders are advised to establish a short position, placing stops at 1511 and refer to ‘trading module’ # 1*.
# 6) If December Cocoa posts multiple closes below 1390****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 1449*.
# 7) If December Cocoa posts multiple closes below 1315****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 1415*.
Our objective will be 1316.
# 8) If December Cocoa posts multiple closes below 1299****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 1415*.
Our objective will be 1299.
# 9) If December Cocoa does not post lows of 1414 or highs of 1536 in October:
Aggressive traders will be advised of a new set of ‘trading modules’ in the November 4th issue of The Joss Report.
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DECEMBER SWISS FRANC (SFZ6)
In the Joss Report dated 9/10/06, I began discussing the December Swiss Franc because of several trade signals.
Last week I explained that due to these trade signals, the December Swiss Franc became a ‘top trade.’
I also explained in that issue that the December U.S. Dollar had a trade signal. Traders were reminded that the Dollar moves opposite the Swiss Franc.
On 9/06/06, the December Swiss Franc posted a sell signal at .8159.
On 9/07/06, the December Swiss Franc posted an unconfirmed sell signal at .8140.
On 9/07/06, the December U.S. Dollar posted a buy signal at .8497.
On 9/15/06, The December Swiss Franc posted a low of .7995; traders were advised to exit their short positions.
On 9/29/06, the December Swiss Franc posted a confirmed sell signal at .8140.
On 10/04/06, the December Swiss Franc posted a sell signal at .8080.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week increased by 2,710, posting a total open interest of 72,687 contracts.
This product is for aggressive traders only.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk is $1,925.
If you do not fit this risk profile, traders are advised to consult with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
Aggressive traders who established a short position at .8080 are advised to move their stops above .8140*.
# 1) If the December Swiss posts multiple closes below .7995****:
Aggressive traders are advised to establish a short position, placing stops above .8080.
# 2) If the December Swiss posts multiple closes below .7885:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above .7995*.
# 3) If the December Swiss posts multiple closes below .7851:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above .7995*.
# 4) If the December Swiss posts multiple closes below .7823:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above .7967*.
Our objective will be .7777.
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DECEMBER BRITISH POUND (BPZ6)
This week I’m adding the December British Pound to ‘Tech Talk’ due to a trade signal for next week - and possibly next month.
On 9/28/06, the December Pound posted an unconfirmed sell signal at 1.8755.
The December Pound has been in a five-week consolidation between 1.9116 (8/31/06) highs and 1.8627 lows (9/11/06).
This product is not for the faint of heart because of the nature of its trading personality - which can be dramatic.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week decreased by -17,457, posting a total open interest of 104,665 contracts.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk next week will be $1,425.
Traders are advised to begin consulting with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
The trading modules listed below are for very aggressive traders. Less aggressive traders are advised to wait for several trade signals before establishing a position.
# 1) If the December Pound posts 1.8914 and multiple closes above 1.8930****:
Very aggressive traders are advised to establish a long position, placing all stops at 1.8686 and refer to trading module #5*.
# 2) If the December Pound posts multiple closes above 1.8975****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing stops at 1.8686*.
# 3) If the December Pound posts multiple closes above 1.9044****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 1.8913*.
# 4) If the December Pound posts 1.9090 and multiple closes above 1.9103****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 1.8942*.
Our objective will be 1.9142.
# 5) If the December Pound posts 1.8686 and multiple closes below 1.8627****:
Very aggressive traders are advised to establish a short position, placing stops at 1.8914 and refer to ‘trading module’ # 1*.
# 6) If the December Pound posts multiple closes below 1.8585****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing stops above 1.8914*.
Our objective will be 1.8458.
# 7) If the December Pound posts multiple closes below 1.8447****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 1.8686*.
# 8) If the December Pound posts multiple closes below 1.8300****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 1.8447*.
# 9) If the December Pound posts multiple closes below 1.8248****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 1.8447*.
Our objective will be 1.8168.
# 10) If the December Pound does not post lows of 1.8626 or highs of 1.9104 in October:
Aggressive traders will be advised of a new set of ‘trading modules’ in the November 4th issue of The Joss Report.
________________________________________
DECEMBER COFFEE (KCZ6)
This week I am adding December Coffee to ‘Tech Talk’ due to a trade signal for next week and possibly next month.
On 9/08/06, December Coffee posted a sell signal at 105.35.
On 7/28/06 and 9/18/06, December Coffee posted a potential ‘double’ bottom (divergence) at 101.40 and 101.00 respectively.
This product is not for the faint of heart because of the nature of its trading personality, which can be very dramatic.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week increased by 5,067, posting a total open interest of 110,868 contracts.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk next week will be $2,062.50.
Traders are advised to begin consulting with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
The trading modules listed below are for very aggressive traders. Less aggressive traders are advised to wait for several trade signals before establishing a position.
# 1) If December Coffee post 107.95 and multiple closes above 108.60****:
Very aggressive traders are advised to establish a long position, placing all stops at 102.45 and refer to trading module # 4*.
# 2) If December Coffee posts multiple closes above 110.20****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing stops below 106.25*.
# 3) If December Coffee posts multiple closes above 111.20****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 107.95*.
Our objective will be 113.45.
# 4) If December Coffee posts 102.45 and multiple closes below 102.00****:
Very aggressive traders are advised to establish a short position, placing stops at 107.95 and refer to ‘trading module’ # 1*.
# 5) If December Coffee posts multiple closes below 101.00****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing stops above 1.8914*.
# 6) If December Coffee posts multiple closes below 100.50****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 102.45*.
# 7) If December Coffee posts multiple closes below 99.75****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 102.45*.
# 8) If December Coffee posts multiple closes below 98.00****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 100.00*.
Our objective will be 96.95.
# 9) If December Coffee does not post lows of 100.95 or highs of 111.25 in October:
Aggressive traders will be advised of a new set of ‘trading modules’ in the November 4th issue of The Joss Report.
________________________________________
JANUARY SOYBEANS (SF6)
This week I’m adding January Soybeans to ‘Chart Watch’ due to a potential breakout trade signal last week at 577.00.
Long-term readers know that Soybeans posted a sell signal on 7/14/06 at 628.25 and haven’t looked back since. However, due to a possible breakout trade signal last week, I feel an obligation to bring the following information to traders’ attention.
January Soybeans have been in a five-week consolidation between lows of 550.00 (9/13/06) and highs of 577.00 (8/25/06 and 10/04/06).
This product is not for the faint of heart because of the higher or lower openings each day - which can be dramatic.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week increased by 12,458, posting a total open interest of 379,185 contracts.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk will be $1,375.
Traders are advised to begin consulting with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
The trading modules listed below are for very aggressive traders. Less aggressive traders are advised to wait for several trade signals before establishing a position.
# 1) If January Soybeans post a price pullback to 563.50:
Very aggressive traders are advised to establish a long position, placing all stops at 549.75 and refer to trading module # 7*.
Option traders are advised to purchase January 580 calls, risking 70% of purchase price**.
# 2) If January Soybeans post multiple closes above 577.00****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops at 549.75 and refer to trading module # 7*.
Option traders are advised to purchase January 580 calls, risking 70% of purchase price**.
# 3) If January Soybeans post 582.00 and multiple closes above 585.25****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 563.50*.
Option traders are advised to purchase January 600 calls, risking 70% of purchase price**.
# 4) If January Soybeans post 591.00 and multiple closes above 596.00****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 577.00*.
Option traders are advised to purchase January 620 calls, risking 70% of purchase price**.
Our objective will be 606.00.
# 5) If January Soybeans post multiple closes above 614.00****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 591.00*.
Option traders are advised to purchase January 640 calls, risking 70% of purchased price**.
# 6) If January Soybeans post multiple closes above 619.50****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 596.00*.
Option traders are advised to purchase January 640 calls, risking 70% of purchased price **.
Our objective will be 626.00.
# 7) If January Soybeans post multiple closes below 549.75****:
Very aggressive traders are advised to establish a short position, placing stops at 577.25 and refer to ‘trading module’ # 1*.
Option traders are advised to sit on the sidelines and wait.
# 8) If January Soybeans post 540.50 and multiple closes below 539.50****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 563.50*.
Our objective will be 526.50.
# 9) If January Soybeans post multiple closes below 526.00****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 550.00*.
# 10) If January Soybeans post multiple closes below 512.50****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 539.50*.
Our objective will be 498.50.
________________________________________
DECEMBER GOLD (GCZ6)
In the Joss Report dated 8/27/06, I began discussing December Gold because of a pending monthly trade signal.
Between 9/5/06 and 9/6/06, December Gold posted a bearish ‘Island reversal’ top.
Three weeks ago I advised traders that December Gold had developed a possible bearish descending right triangle.
I also advised that if formation came to fruition, our objective will be 547.00.
On 8/28/06, December Gold posted a sell signal at 627.40.
On 9/07/06, December Gold posted a sell signal at 640.90.
On 9/08/06, December Gold posted an unconfirmed sell signal at 615.40.
On 9/26/06, December Gold posted a buy signal at 598.10.
Between 9/28/06 and 10/02/06, December Gold posted a second bearish ‘Island Reversal’ top.
On 9/29/06, December Gold posted a confirmed sell signal at 615.40.
Last week I stated that ‘as long as December Gold remains below 615.40, downside pressure will continue.’
Major resistance is at 615.40.
Minor resistance is at 598.10.
December Gold has several unfilled price gaps below the current market price. The most recent is between lows of 563.00 and highs of 563.50 (3/13/06).
December Gold has three unfilled price gaps above the current market price. The most recent price gap is between 595.00 and 602.00.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week increased by 7,128, posting a total open interest of 330,065 contracts.
This product is for very aggressive traders only.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk for this week is $3,810.
If you do not fit this risk profile, traders were and are advised to consult with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
For September, December Gold posted a key sell signal at 615.40.
Aggressive traders who established a short position at 611.00 on 9/28/06 against the 613.50 gap are advised to move stops to 602.00*.
Option traders who purchased 580 puts are advised to risk 30% of market value**.
Aggressive traders who either added to their existing short position or established a short position on the ‘Island Reversal’ gap at 595.00 or below are advised to move stops for this position only above 598.10*.
Option traders who purchased 570 puts are advised to risk 30% of market value**.
# 1) If December Gold posts multiple closes below 576.00****:
Aggressive traders are advised to establish a short position, placing all stops above 598.10*.
Option traders are advised to purchase December 570 puts, risking 70% of purchase price**.
# 2) If December Gold posts a close below 565.10 and multiple closes below 563.50****:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 576.60*.
Option traders are advised to purchase December 560 puts, risking 70% of purchase price**.
# 3) If December Gold posts multiple closes below 555.60****:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 576.60*.
Option traders are advised to purchase December 550 puts, risking 70% of purchase price**.
Our objective will be 541.60.
* (Futures traders and their account executives are advised to discuss this suggested stop).
** (Option traders and their account executives are advised to discuss the suggested risk).
*** (Traders can exit or hedge a trade position once it moves in their direction but are advised to remove all resting stop orders).
**** (Very aggressive Traders can enter a trade position without multiple closes but are advised to use resting stop orders).
________________________________________
CHART WATCH by Scott R. Joss (Non member C.T.A)*
________________________________________
Chart Watch includes markets developing a 'trade signal' or a chart pattern that has not yet fully developed - or may never develop.
During the course of the week or month it is not uncommon to find an `intra-day, intra-week or intra-month' recommendation that was previously not revealed when this newsletter was written.
Products that currently fit into this 'watch' category are listed below and should be 'watched.'
________________________________________
DECEMBER LIVE CATTLE (LCZ6)
Last week, I added December Live Cattle to ‘Chart Watch’ due to a trade signal.
In addition Long-term readers know that the meats are not my favorite product to technically track due to their unpredictability.
This product is not for the faint of heart because of the higher or lower openings each day, which can be dramatic.
December Live Cattle will remain on ‘Chart Watch’ this week because of a complex ‘broadening formation’ on the daily chart.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week increased by 3,830, posting a total open interest of 221,700 contracts.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk for next week will be $1,088.
Traders are advised to begin consulting with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
The trading modules listed below are for very aggressive traders. Less aggressive traders are advised to wait for several trade signals before establishing a position.
# 1) If December Live Cattle posts 90.55, and multiple closes above 91.20****:
Very aggressive traders are advised to establish a long position, placing all stops at 89.15 and refer to trading module # 4*.
# 2) If December Live Cattle posts multiple closes above 92.30****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 90.50*.
Our objective will be 93.10.
# 3) If December Live Cattle posts multiple closes above 94.00****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 91.10*.
Our objective will be 99.35.
# 4) If December Live Cattle posts 89.17 and multiple closes below 88.55****:
Very aggressive traders are advised to establish a short position, placing stops at 90.55 and refer to ‘trading module’ # 1*.
# 5) If December Live Cattle posts 87.85 and multiple closes below 87.65****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 88.55*.
# 6) If December Live Cattle posts multiple closes below 86.30****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 87.65*.
Our objective will be 83.15.
# 7) If December Live Cattle does not post lows of 88.55 or highs of 94.00 in October:
Aggressive traders will be advised of a new set of ‘trading modules’ in the November 4th issue of The Joss Report.
________________________________________
MARCH SUGAR (SBH6)
For the last twenty-four weeks I have developed and written ‘trading modules’ based on Sugar’s weekly and monthly sell signals.
The first such monthly sell signal occurred last May based on the July 2006 contract at 16.57. This key monthly sell signal at 16.57 has had the power to drive current prices to lows of 10.66 verses the March 2007 contract.
This week I’m moving Sugar to ‘Chart Watch’ because of the decreasing open interest – and not because of a technical change in trend… yet.
Last week I asked if this downward momentum might continue.
I listed the two all important bullish ‘W’ formation breakouts from 2005.
The first key upside ‘W’ breakout was at 8.70.
The second key upside ‘W’ breakout occurred at 11.40.
March Sugar has an unfilled price gap below the current market price between lows of 9.55 and highs of 9.58 (8/30/05).
March Sugar has several unfilled price gaps above the current market price. The most recent price gap is between 11.29 and 11.30 (10/2/06).
Our first objective of 11.56 was met on 9/22/06.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for futures last week decreased by -40,494, posting a total open interest of 432,984 contracts.
This product is for aggressive traders only.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
Aggressive traders who established a short position below 12.15 and have not exited their positions are advised to place stops above 11.90 or exit their positions*.
Aggressive traders who either added to their existing short position or established a short position below 11.88 and have not exited their positions are advised to place stops above 11.90 or exit their positions*.
Aggressive traders who either added to their existing short position or established a short position below 11.47 and have not exited their positions are advised to place stops above 11.90 or exit their positions*.
Aggressive traders who either added to their existing short position or established a short position on a price advance towards 11.69 are advised to place stops above 11.90 or exit their positions*.
# 1) If March Sugar posts multiple closes below 10.66****:
Aggressive traders are advised to either add to their existing positions or re-establish a short position, placing all stops above 11.90*.
Option traders are advised to purchase March 1150 puts, risking 70% of purchase price**.
# 2) If March Sugar posts multiple closes below 10.40****:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing stops above 11.57*.
Option traders are advised to purchase March 1100 puts, risking 70% of purchase price**.
# 3) If March Sugar posts multiple closes below 10.15****:
Aggressive traders are advised to either add to their existing short positions or establish a short position, placing stops above 11.02*.
Option traders are advised to purchase March 1100 puts, risking 70% of purchase price**.
Our objective will be 9.70.
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NOVEMBER CRUDE OIL (CLX6)
In the Joss Report dated 9/17/06, I began developing ‘trading modules’ for November Crude Oil.
This week Crude will be posted in Chart Watch’ because of the fast approaching first notice day for November Crude Oil, open interest, and a key moving average at 58.54.
Between 8/07/06 and 8/09/06, November Crude Oil posted a bearish ‘island reversal’ top.
In addition, between 6/20/06 and 8/16/06, November Crude Oil developed a bearish ‘M’ formation.
The middle of the ‘M’ was at 74.50.
On 8/16/06, November Crude Oil posted a close below the all important ‘M’ formation.
On 8/17/06, November Crude Oil penetrated a seventeen-month trendline at 74.05.
On 9/6/06, November Crude Oil posted a close below last year’s high (for the November contract) of 68.95.
On 9/13/06, November Crude Oil penetrated a two-year trendline at 64.70.
This product is for very aggressive traders and not for the faint of heart.
Very aggressive traders were and continue to be advised not to exceed the rule of thumb - 10% of equity to risk ratio.
If you do not fit this risk profile, traders were and are advised to consult with their account executive for an option trading strategy.
Very aggressive traders looking to minimize risk continue to be advised to use the electronic miNY Crude Oil as their trading vehicle.
November Crude Oil has five unfilled price gaps above the current market price. The most recent unfilled price gap is between 70.20 and 70.25 (9/5/06).
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for Crude Oil futures last week increased by 24,792, posting a total open interest of 1,173,630 contracts.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for miNY Crude Oil futures last week increased by 9,005, posting a total open interest of 52,559 contracts.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
Very aggressive traders who established a short position at 62.80 or below are advised to move stops above 64.00 or exit their position*.
Very aggressive traders who established a short position at 61.00 or below are advised to move stops above 64.00 or exit their position*.
Very aggressive traders who established a short position on a price advance towards 63.50 are advised to move stops above 64.00 or exit their position*.
# 1) If November Crude posts multiple closes below 57.75****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 62.70*.
Our objective will be 57.02.
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DECEMBER 10-YEAR NOTE (TYZ6)
In the Joss Report dated 9/10/06, I added the December 10-Year Note to ‘Chart Watch.’
This week the December 10-year Note will again be moved from ‘Tech Talk’ to ‘Chart Watch’ because of last week’s reversal pattern, resistance at a key moving average of 108-200, and open interest.
On 8/16/06, the December 10-Year Note posted a buy signal at 106-200.
On 8/30/06, the December 10-Year Note posted a buy signal at 107-040.
On 9/14/06, the December 10-Year Note posted a buy signal at 107-150.
On 9/19/06, the December U.S. 30-Year Bond posted a buy signal at 111-05.
On 9/20/06, the December 10-Year Note posted a buy signal at 107-165.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated the net change in open interest for 10-Year Note futures last week increased by 43,744, posting a total open interest of 2,241,109 contracts.
This product is for very aggressive traders only.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
If you did not fit this risk profile, traders were and are advised to consult with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
Very aggressive traders who established a long position in the 10-Year Note at 106-200 or above are advised to leave stops below 107-160 or exit their position*.
Very aggressive traders who established a long position in the 10-Year Note at 107-040 or above are advised to leave stops below 107-160 or exit their position*.
Very aggressive traders who established a long position in the 10-Year Note at 107-150 or above are advised to leave stops below 107-160 or exit their position*.
Very aggressive traders who established a long position in the 10-Year Note at 107-165 or above are advised to leave stops below 107-160 or exit their position*.
Very aggressive traders who either added to their long position or established a long position at 107-290 or above are advised to leave stops below 107-160 or exit their position*.
* (Futures traders and their account executives are advised to discuss this suggested stop).
** (Option traders and their account executives are advised to discuss the suggested risk).
*** (Traders can exit or hedge a trade position once it moves in their direction but are advised to remove all resting stop orders).
**** (Very aggressive Traders can enter a trade position without multiple closes but are advised to use resting stop orders).
________________________________________
NOTE:
If you do not completely understand this information, you are advised to take NO action until speaking with your Account Executive.
ClearTrade®, Inc. may be reached at 800-493-4444
________________________________________
* The Joss Report trade recommendations and weekly trade advisor is prepared by Scott Joss, Non- Member C.T.A.
Scott Joss is a 'non member' CTA and is providing the Joss Report weekly trading advisor and trade recommendations to ClearTrade®, Inc. clients. Scott Joss 'is a principal' of ClearTrade, Inc. and 'is a registered IB member' with the NFA.
________________________________________
ClearTrade®, Inc.
5415 N. Sheridan Rd.
Suite 2104
Chicago, IL 60640
(800) 493-4444
(773) 561-9777 Voice
(773) 561-9775 Fax
Mailto:research@cleartrade.com
http://www.cleartrade.com/
________________________________________
DISCLAIMER:
Market recommendations are strictly the opinion of the writer and are intended solely for informative purposes and are not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Futures trading involve substantial risk. In no event should the content of a market letter be construed as a promise that you will profit or that losses can or will be limited in any manner whatsoever.
ClearTrade, Inc. does not necessarily promote or endorse the services or publications described herein. Unless otherwise indicated, ClearTrade Inc. has had no role in the production or review of these products or services and makes no warranty, either expressed or implied, as to their contents, accuracy or performance.
Past results are no indication of future performance. Information provided in this newsletter is intended solely for informative purposes and is obtained from sources believed to be reliable. Information is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted.
REPRODUCTION OR REBROADCAST OF ANY PORTION OF THIS INFORMATION IS STRICTLY PROHIBITED WITHOUT THE WRITTEN PERMISSION OF S.R. JOSS INC./CLEARTRADE®, INC.
The contents of this newsletter are copyright 1997-2005, Scott R. Joss/S.R. Joss Inc./ClearTrade ®,Inc. *TM. All Rights Reserved.
posted by trader1s | 1:22 PM
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