In This Issue
Find Your Futures Trading Blood Type
Economic Reports and Expiration Notices
The Fed is meeting today (Wednesday June 27th) and tomorrow Thursday June 28th for what is widely known as the FOMC.
Many traders know that FOMC announcements (due tomorrow at 2:15 PM eastern) affect many markets and traders will analyze the statement for clues regarding future outlook of interest rates.
No change in the fed funds rate target is likely, along with little if any change in the statement. There is little doubt that Fed policy will be on hold for a while. The real question now is just how far the market will slide before it finds some solid support.
by Ilan Levy-Mayer, Vice President, Cannon Trading - originally published in SFO Magazine, July 2004
Perhaps the greatest luxury I have in this business is the ability to observe the experiences of many traders with different personalities, life schedules and risk capital, each trading in a variety of markets? What most astute brokers realize is that, over time, as some individuals prematurely exit winners while others desperately cling to losers, it becomes quite possible to match different "blood types" of those traders with their correct "trading diets." Clearly, we're not talking the medical blood type here, but in the figurative sense it makes the right point. With practice, it's not too hard to determine blood types (type of trading best suited to the individual) based on the personality of the trader, and then prescribe a diet based on that individual trader's capital, experience, risk profile and schedule.
Discovering Your Blood Type and Trading Diet
Just like a diet, where there is no right plan for everyone, in trading there is no single plan for all traders. Before deciding whether to "cut out the carbs," "add more fiber," or simply avoid certain markets, do some self-assessment, starting with personality. For example, are you hesitant or impulsive? Patient or short-tempered? Identify strengths and weaknesses, and then let someone close to you help pinpoint those personality pros and cons. Have a tough skin; it's for your own good.
To further understand your personality, keep a trading journal to help zone in on specific traits and how they affect your trading. Remember, understanding your personality is one thing; understanding it when you're trading is another. While patience with children is good, patience with a losing trade is not. A journal enables traders to review winning and losing trades and identify factors that aided in success or contributed to failure. After reviewing inner traits, don't forget to review the outer onesÑyour schedule and risk capital. Think long and hard about how much you have available in terms of time and risk capital when it comes to trading, and don't delude yourself. In addition, look at how you are using your time and risk capital. Go over the market(s) you are trading, the style of trading and time frames you are using. Is this market, this style and this time frame suitable to your risk capital and personal schedule? Are they suitable to your personality?
Doing some self-assessment is absolutely essential to determining what type of trading diet you should be on, as the examples later will make clear. But first let's define the trading blood types and their respective diets.
Blood Types and Trading Diets:
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Source: Moore Research Center, Inc.
| Date | Reports | Expiration & Notice Dates |
|---|---|---|
| 06/28 Thu |
7:30 AM CDT - GDP-Final(Q1) 7:30 AM CDT - Chain Deflator-Final(Q1) 7:30 AM CDT - USDA Weekly Export Sales 7:30 AM CDT - Initial Claims-Weekly 9:00 AM CDT - Help-Wanted Index(May) 9:30 AM CDT - EIA Gas Storage 1:15 PM CDT - FOMC Policy Statement 3:30 PM CDT - Money Supply |
FN: Jul Natural Gas(NYM)
|
| 06/29 Fri |
7:30 AM CDT - Grain Stocks & Plantings 7:30 AM CDT - Personal Income & Spending(May) 7:30 AM CDT - Core PCE Inflation(May) 8:45 AM CDT - Chicago PMI(Jun) 9:00 AM CDT - Construction Spending(May) 9:00 AM CDT - Michigan Sentiment-Rev(Jun) 2:00 PM CDT - Quarterly Hogs & Pigs 2:00 PM CDT - Dairy Products Prices |
FN: Jul Wheat(CBT)
Jul Oats(CBT) Jul Soybeans(CBT) Jul Soybean Oil & Meal(CBT) Jul Corn(CBT) Jul Rough Rice(CBT) Jul Gold(CMX) Jul Silver(CMX) Jul Copper(CMX) Jul Platinum(NYM) Jul Palladium(NYM) LT: Jun Fed Funds(CBT) Jun Live Cattle(CME) Jun US 2 Yr Notes(CBT) Jun US 5 Yr Notes(CBT) Jul Sugar(NYBOT) Jul Heating Oil(NYM) Jul Unleaded Gas(NYM) Jul Lumber Options(CME) |
| 07/02 Mon |
9:00 AM CDT - ISM Index(Jun)
|
FN: Jul Orange Juice(NYBOT)
Jul Sugar(NYBOT) |
| 07/03 Tue |
9:00 AM CDT - Factory Orders(May)
9:00 AM CDT - Pending Home Sales(May) 4:00 PN CDT - Auto & Truck Sales |
FN: Jul Heating Oil(NYM)
Jul Gasoline(RB)(NYM) |
| 07/04 Wed |
4th of July Holiday
|
|
| 07/05 Thu |
7:30 AM CDT - USDA Weekly Export Sales
7:30 AM CDT - Initial Claims-Weekly 9:00 AM CDT - ISM Services(Jun) 9:30 AM CDT - API & DOE Energy Stats 3:30 PM CDT - Money Supply |
|
* Please note that the information contained in this letter is intended for clients, prospective clients, and audiences who have a basic understanding, familiarity, and interest in the futures markets.
** The material contained in this letter is of opinion only and does not guarantee any profits. These are risky markets and only risk capital should be used. Past performances are not necessarily indicative of future results.
*** This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts herein contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgment in trading!