In This Issue
1. Wheat Bulls Exhausted, But May Make Another Less-Powerful Run Soon
2. Free Guide: 'Surival Day-Trading' by Ilan Levy
3. Futures Market: Economic Calendar
by Jim Wyckoff
December soft red winter wheat futures at the Chicago Board of Trade late last week scored a fresh 22-month high of $8.68 a bushel. Prices have since backed off sharply to suggest the bulls have become exhausted and that a near-term market top is in place. Last Friday's market action, in which wheat futures prices were sharply higher in the overnight trade and sharply lower in the day trading session--to produce a whopping $1.13-a-bushel daily trading range in December wheat--did produce a technically bearish buying exhaustion tail, whereby buying interest dried up at the higher price levels and prices then backed way off, to produce a tail on the daily chart. Recent price action in December Chicago wheat futures may also be producing a bearish V-top reversal pattern on the daily chart, whereby prices spike higher and then quickly retreat. The wheat market bulls can correctly argue they still possess the overall near-term technical advantage, as December futures are still in a two-month-old uptrend on the daily bar chart. There is psychological support for December wheat futures at the $7.00 level. A close below $7.00 would produce more serious near-term chart damage to help confirm that a major market top is in place. Overhead technical resistance for December Chicago wheat is located at Wednesday's overnight high of $7.40 3/4 and then at $7.50. Above that lies chart resistance at this week's high of $7.68 1/2. Major psychological resistance is located at $8.00 a bushel. Historical charts for the grain futures markets do show that major market tops many times are defined by a steep surge higher in prices followed by a sharp retreat, to form spike tops or V-top reversals. However, longer-term chart history for the grains also shows that soon after major market tops are scored in the grains, secondary price rallies can occur to provide the bulls a brief boost of confidence to think new highs are in the offing. Typically, however, those secondary rallies fall shy of the initial spike price tops. Such could be the case in the wheat futures market in the coming days or weeks. --Stay tuned! Jim Wyckoff
Past results are not necessarily indicative of future results. The risk of loss in trading can be substantial, carefully consider the inherent risks of such an investment in light of your financial condition.
Register to download the guide: 'Surival Day-Trading' by Ilan Levy-Mayer.
Here's a sample from the PDF:
"I started as a commodity broker back in 1998, when commissions of $25 per round turn for the E-minis were considered a deep discount. I had the luxury of observing many types of day traders and saw things from the sidelines that most traders couldn't see during the heat of battle, one of which is the importance of solid money management for the long-term survival of day trade."
This 3 page article (published in SFO magazine Sept. 2007) offers some practical tips for both newcomers and experienced commodity traders. Please fill out the short form below to start reading immediately:
Source: Moore Research Center, Inc.
| Date | Reports | Expiration & Notice Dates |
|---|---|---|
| 08/11 Wed |
7:30 AM CDT - Trade Balance(Jun)
9:30 AM CDT - API & DOE Energy Stats 1:00 PM CDT - Treasury Budget(Jul) |
|
| 08/12 Thu |
7:30 AM CDT - WASDE Report & Crop Production
7:30 AM CDT - Supply & Demand 7:30 AM CDT - USDA Weekly Export Sales 7:30 AM CDT - Initial Claims-Weekly 7:30 AM CDT - Export & Import Prices(Jul) 9:30 AM CDT - EIA Gas Storage 3:30 PM CDT - Money Supply |
|
| 08/13 Fri |
7:30 AM CDT - Dairy Product Prices
7:30 AM CDT - Core CPI & CPI(Jul) 7:30 AM CDT - Retail Sales(Jul) 8:55 AM CDT - Mich Sentiment(Aug) 9:00 AM CDT - Business Inventories(Jun) |
LT: Aug Lean Hogs(CME)
Aug Soybeans(CBT) Aug Soymeal(CBT) Aug Soyoil(CBT) Aug Lean Hogs Options(CME) Aug Eurodollar Options(CME) Sep Coffee(ICE) |
| 08/16 Mon |
7:30 AM CDT - NOPA Crush
8:00 AM CDT - Net Long-Term TIC Flows(May) |
LT: Sep Sugar 11 Options(NYM)
|
| 08/17 Tue |
7:30 AM CDT - Building Permits & Housing Starts(Jul)
7:30 AM CDT - Core PPI & PPI(Jul) 8:15 AM CDT - Capacity Util & Industrial Prod(Jun) |
LT: Sep Crude Lt Options(NYM)
|
| 08/18 Wed |
9:30 AM CDT - API & DOE Stats
2:00 PM CDT - Milk Production |
FN: Sep Cocoa(Sep)
LT: Sep Platinum(CMX) |
| 08/19 Thu |
7:30 AM CDT - USDA Weekly Export Sales
7:30 AM CDT - Inital Claims-Weekly 9:00 AM CDT - Leading Indicators(Jul) 9:00 AM CDT - Philadelphia Fed(Aug) 9:30 AM CDT - EIA Gas Storage 3:30 AM CDT - Money Supply |
|
| 08/20 Fri |
7:30 AM CDT - Dairy Products Prices
2:00 PM CDT - Cattle On Feed 2:00 PM CDT - Cold Storage |
LT: Sep Crude Lt(NYM)
Aug Nikkei Options(CME) Aug DJIA Options(CME) Aug S&P 500 Options(CME) Aug E-Mini S&P 500 Options(CME) Aug NASDAQ Options(CME) Aug Russell Options(CME) Aug Value Line Options(CME) Sep Cotton Options(NYM) Sep Orange Juice Options(ICE) |
| 08/23 Mon |
|
FN: Sep Coffee(ICE)
|
| 08/24 Tue |
9:00 AM CDT - Existing Home Sales(Jul)
9:00 AM CDT - New Home Sales(Jul) |
FN: Sep Crude Lt(NYM)
|
| FN=First Notice, OE=Option Expiration, LT=Last Trade | ||
* 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!