In This Issue
Crude Oil on Verge of Bullish Upside Breakout
8 Steps to Successful Futures Day Trading
Economic Calendar
by Jim Wyckoff
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Crude oil futures for December delivery on the New York Mercantile Exchange on Wednesday hit a fresh four-week high of $85.04 a barrel. Prices are now poised to produce a bullish upside "breakout" from a four-week-old, sideways trading range on the daily bar chart. That trading range is marked by strong overhead technical support at the October high of $85.08 and by solid chart support at the October low of $79.90. Price action this week in December crude oil futures has provided the bulls with fresh near-term technical momentum. The direction in which December crude oil "breaks out" of the aforementioned trading range is likely to be the direction of the next significant near-term price trend in the market. At present, technical odds are favoring an upside breakout has prices hover near the top of the sideways trading range. Near-term technical support for December crude oil is found at Wednesday's low of $84.04, at $83.50 and then at $83.00. Near-term technical resistance is located at the October high of $85.08, at $85.50 and then at $86.00. Importantly, the crude oil market will continue to be impacted by the value of the U.S. dollar compared to the other major world currencies. If the U.S. dollar index, which is a basket of six major currencies weighted against the greenback, embarks on a fresh leg down on the daily chart, that would be a fresh underlying bullish factor for crude oil that would likely push prices to or above $90.00 a barrel. If the dollar index puts in a market bottom in the near term and then begins to trend higher on the daily chart, that would be a bearish underlying factor for crude oil futures that would at least temporarily dent bullish enthusiasm in crude. Stay tuned!
Download and read our guide which outlines some important futures day trading concepts. It may be beneficial to read this guide before trading commodities on the futures market.
My name is Ilan Levy-Mayer and I am the Vice President and Senior Futures Broker at Cannon Trading. I came up with the following personal observations after serving online traders worldwide for more than 11 years.
The following steps are guides to progress, and are not necessarily in sequential order. Some of them are always required, but each futures trader is different and will relate to these stages in their own ways. While attempting to learn and progress, one must keep in mind that futures trading is risky and can involve significant losses.
1. Education
Hopefully if you are already trading you have completed your initial education: contract specs, trading hours, futures brokers, platforms, the opportunities as well as the risk and need to use risk capital in futures, and so on. Understanding this information is essential to futures trading. The second type of education is ongoing: learning about trading techniques, the evolution of futures markets, different trading tools, and more.
2. Find a System
I am definitely not advising you to go on the web and subscribe to a "black box" system (using buy/sell triggers if don't know why they are being generated). What I am advising is developing a trading technique: a general set of rules and a trading concept. As you progress, you may want to put the different rules and indicators into a computerized system, but the most important factor is to have a focus and a plan. Don't just wake up in the morning and trade "blank."
3. Survival
This is the key! Do what you need to do in order to survive this brutal business and give yourself the chance of being here down the road with more experience and a better chance of success. Survival is probably the biggest key for beginning traders. There is a saying in this business: "live to trade another day." It is so true!
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There is a substantial risk of loss in trading commodity futures, options and off-exchange foreign currency products. Past performance is not indicative of future results.
Source: Moore Research Center, Inc.
| Date | Reports | Expiration & Notice Dates |
| 11/03 Wed |
6:00 AM CDT - MBA Mortgage Applications 6:30 AM CDT - Challenger Job Cuts(y/y)(Oct) 7:15 AM CDT - ADP Employment Change(Oct) 9:00 AM CDT - Factory Orders(Sep) 9:00 AM CDT - ISM Services(Oct) 9:30 AM CDT - API & DOE Energy Stats 1:00 PM CDT - Auto & Truck Sales 1:15 PM CDT - FOMC Rate Decision |
|
| 11/04 Thu |
7:30 AM CDT - Productivity-Prel(Q3) 7:30 AM CDT - Initial Claims-Weekly 7:30 AM CDT - Unit Labor Costs(Q3) 7:30 AM CDT - USDA Weekly Export Sales 9:30 AM CDT - EIA Gas Storage 3:30 PM CDT - Money Supply |
LT: Oct Milk(CME) Oct Milk Options(CME) |
| 11/05 Fri |
7:30 AM CDT - Dairy Products Prices 7:30 AM CDT - Ave Workweek & Hourly Earnings(Oct) 7:30 AM CDT - Nonfarm Payrolls(Oct) 7:30 AM CDT - Unemployment Rate(Oct) 9:00 AM CDT - Pending Home Sales(Sep) 2:00 PM CDT - Consumer Credit(Sep) |
LT: Nov Canadian Dollar Options(CME) Nov Currencies Options(CME) Nov US Dollar Index Options(ICE) Nov Live Cattle Options(CME) Dec Cocoa Options(ICE) |
| 11/08 Mon |
||
| 11/09 Tue |
7:30 AM CST - WASDE Report & Crop Production 9:00 AM CST - Wholesale Inventories(Sep) |
LT: Nov Orange Juice(ICE) |
| 11/10 Wed |
6:00 AM CST - MBA Mortgage Applications 7:30 AM CST - Export & Import Prices(Oct) 7:30 AM CST - Trade Balance(Sep) 9:30 AM CST - API & DOE Energy Stats 1:00 PM CST - Treasury Budget |
|
| 11/11 Thu |
VETERAN'S DAY 7:30 AM CST - Initial Claims-Weekly 7:30 AM CST - USDA Weekly Export Sales 9:30 AM CST - EIA Gas Storage 3:30 PM CST - Money Supply |
|
| 11/12 Fri |
7:30 AM CST - Dairy Products Prices 8:55 AM CST - Mich Sentiment(Nov) |
LT: Nov Rough Rice(CBT) Nov Soybeans(CBT) Nov Eurodollar Options(CME) Dec Cotton Options(NYM) Dec Coffee Options(ICE) |
| 11/15 Mon |
7:30 AM CST - NOPA Crush 7:30 AM CST - Retail Sales(Oct) 7:30 AM CDT - Empire Manufacturing Index(Nov) 9:00 AM CST - Business Inventories(Sep) |
LT: Nov Lumber(CME) Dec Sugar 11 Options(NYM) |
| 11/16 Tue |
7:30 AM CST - Core PPI & PPI(Oct) 8:00 AM CST - Net Long-Term TIC Flows(Aug) 8:15 AM CST - Capacity Util & Industrial Prod(Aug) 9:00 AM CST - NAHB Market Housing Index(Nov) |
FN: Nov Lumber(CME) Dec Cocoa(ICE) LT: Dec Crude Lt 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!