In This Issue
1. Market in Review: Chicago Wheat
2. Mental Risk Management
3. Economic Calendar
from the Levex Options Newsletter by Levex Capital Management Inc.
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Wheat prices have been battered for the past three months, trading down nearly 90 cents a bushel, on reports of abundant supplies and moderate weather. A government report released Monday also predicted that most of the winter wheat crop is in good to excellent shape.
The good news for wheat came Tuesday after Iraq purchased about 18.3 million bushels of the grain globally, including some from the United States. That boosted hopes of some traders that demand was growing stronger.
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Cannon Trading respects your privacy and will never give this information to a 3rd party.THE RISK OF LOSS IN TRADING COMMODITIES CAN BE SUBSTANTIAL. YOU SHOULD, THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. IN CONSIDERING WHETHER TO TRADE OR TO AUTHORIZE SOMEONE ELSE TO TRADE FOR YOU, YOU SHOULD BE AWARE OF THE FOLLOWING: IF YOU PURCHASE A COMMODITY OPTION, YOU MAY SUSTAIN A TOTAL LOSS OF THE PREMIUM AND OF ALL TRANSACTION COSTS. IF YOU PURCHASE OR SELL A COMMODITY FUTURE OR SELL A COMMODITY OPTION, YOU MAY SUSTAIN A TOTAL LOSS OF THE INITIAL MARGIN FUNDS AS WELL AS FUNDS IN EXCESS OF YOUR ORIGINAL DEPOSIT.. IF THE MARKET MOVES AGAINST YOUR POSITION, YOU MAY BE CALLED UPON BY YOUR BROKER TO DEPOSIT A SUBSTANTIAL AMOUNT OF ADDITIONAL MARGIN FUNDS, ON SHORT NOTICE, IN ORDER TO MAINTAIN YOUR POSITION. IF YOU DO NOT PROVIDE THE REQUESTED FUNDS WITHIN THE PRESCRIBED TIME, YOUR POSITION MAY BE LIQUIDATED AT A LOSS, AND YOU WILL BE LIABLE FOR ANY RESULTING DEFICIT IN YOUR ACCOUNT. UNDER CERTAIN MARKET CONDITIONS, YOU MAY FIND IT DIFFICULT OR IMPOSSIBLE TO LIQUIDATE A POSITION. THIS CAN OCCUR, FOR EXAMPLE, WHEN THE MARKET MAKES A "LIMIT MOVE." THE PLACEMENT OF CONTINGENT ORDERS BY YOU OR YOUR BROKER, SUCH AS A "STOP-LOSS" OR "STOP-LIMIT" ORDER, WILL NOT NECESSARILY LIMIT YOUR LOSSES TO THE INTENDED AMOUNTS, SINCE MARKET CONDITIONS MAY MAKE IT IMPOSSIBLE TO EXECUTE SUCH ORDERS. A "SPREAD" POSITION MAY NOT BE LESS RISKY THAN A SIMPLE "LONG" OR "SHORT" POSITION. THE HIGH DEGREE OF LEVERAGE THAT IS OFTEN OBTAINABLE IN COMMODITY TRADING CAN WORK AGAINST YOU AS WELL AS FOR YOU. THE USE OF LEVERAGE CAN LEAD TO LARGE LOSSES AS WELL AS GAINS. THIS BRIEF STATEMENT CANNOT DISCLOSE ALL THE RISKS AND OTHER SIGNIFICANT ASPECTS OF THE COMMODITY MARKETS. YOU SHOULD THEREFORE CAREFULLY CONSIDER IF COMMODITY TRADING IS SUITABLE FOR YOU BEFORE YOU TRADE.
by Marc from TradingEmini.com
"When you learn what not to do in order not to loose, only then can you begin to learn what to do in order to win"— Edwin Lefevre, Reminiscences of a Stock Operator
1. Managing Position Size
Size envy can make traders take larger positions than they should. Most people can't walk straight into a gym and bench press 300lbs. Traders must build up financial capacity, technical skills and emotional development, judging progress against their own levels not others.
2. Dreaming of a Big Win
This is the earmark of a beginner. The key to success is consistency, steadily achieving profits with a simple sound process and using runners to catch the larger moves or position trade with a separate broker account. A successful athlete focuses on the steps to achieve results not the results.
3. Vengeance Trading
Vengeance trading is when a trader takes a hit and wants to get even with the market risking financial, emotional capital. The angry trader wants revenge, to prove they were right, so they stubbornly enter in the same direction as the loosing trade, focusing on where the trade did not go, rather than where another trade could go in a market which is always impersonal and never wrong.
4. Boredom
The mind will go to great lengths to avoid boredom. A Gamblers Anonymous maxim holds that gambling, or overtrading, is a sign of boredom, so recognize when you are becoming bored and dismiss it as a false emotional trigger.
5. The Averaging Down Sin
Averaging down is adding to a looser, with the hope that it will turn around, without regard for the reality of what your charts are telling you. Never average down, you are stubbornly refusing to admit you are wrong.
6. Are you Trading Intelligently or Gambling
Successful traders trigger when the odds are favourable. Gamblers trigger on hope. A gambler can't explain why they won other than they had a "gut feeling". They trade for excitement, with no plan or discipline, unwilling to accept reality, believing they can have good things without effort.
The Gamblers Anonymous 12-steps can help control loses. For example, "Make a searching and fearless moral and financial inventory of ourselves." Know why you want to be a trader, what you expect to get out of it and whether you really have the right support and financial basis to trade.
"Admit to ourselves and to another human being the exact nature of our wrongs." Keep an honest trading journal and have an accountability group, be it other traders, friends or family.
"Continue to take a personal inventory, and when we are wrong, promptly admit it." When in a bad trade admit it and get out. You must take personal responsibility for your actions and not blame others or "The market".
Trading can be enjoyable and social, gambling is lonely and heartbreaking, The Recovery Book sums it up in one sentence: "To gamble risking progressive deterioration OR Not to gamble and develop a better way of life."
On 14 April, Marc from TradingEmini.com will be doing one of his three annual FREE Advanced Trading Webinars. Click here to register and for the free webinar with this 15 year trading veteran.
Source: Moore Research Center, Inc.
| Date | Reports | Expiration & Notice Dates |
| 04/08 Thu |
7:30 AM CDT - USDA Weekly Export Sales
7:30 AM CDT - Initial Claims-Weekly 9:30 AM CDT - EIA Gas Storage 3:30 PM CDT - Money Supply |
|
| 04/09 Fri |
7:30 AM CDT - Dairy Products Prices
7:30 AM CDT - WASDE Report & Crop Production 7:30 AM CDT - Supply & Demand 9:00 AM CDT - Wholesale Inventories(Feb) |
LT: Apr Canadian Dollar Options(CME)
Apr Currencies Options(CME) Apr US Dollar Index Options(ICE) May Coffee Options(ICE) |
| 04/12 Mon |
1:00 PM CDT - Treasury Budget(Mar) | |
| 04/13 Tue |
7:30 AM CDT - Export & Import Prices(Mar)
7:30 AM CDT - Trade Balance(Feb) |
|
| 04/14 Wed |
7:30 AM CDT - NOPA Crush
7:30 AM CDT - Core CPI & CPI(Mar) 7:30 AM CDT - Retail Sales(Mar) 9:00 AM CDT - Business Inventories(Feb) 9:30 AM CDT - API & DOE Energy Stats 1:00 PM CDT - Fed's Beige Book(Apr) |
|
| 04/15 Thu |
7:30 AM CST - USDA Weekly Export Sales
7:30 AM CST - Initial Claims-Weekly 8:00 AM CDT - Net Long-Term TIC Flows(Jan) 8:15 AM CDT - Capacity Util & Industrial Prod(Mar) 9:00 AM CDT - Philadelphia Fed(Apr) 9:30 AM CST - EIA Gas Storage 3:30 PM CST - Money Supply |
LT: Apr Lean Hogs(CME)
Apr Lean Hogs Options(CME) May Crude Lt Options(NYM) May Sugar 11 Options(NYM) |
* 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!