In This Issue
1. How Should We As Traders Confront Risk?
2. Bearish Breakout in Cotton?
3. Economic Calendar
Risk, it is a four letter word. As traders it is something that we thrive on and dread. We chase and fear. We look for and look to avoid. It is RISK. Without it, there is no opportunity for profit. Without it trading lacks potential. With it, failure and heartache are the consequences when it is abused.
Risk itself is not a bad thing. When it is misused by traders, it becomes a problem. Controlled risk presents traders with exciting and profitable opportunities. Uncontrolled, it brings the end to the dreams and careers of many traders.
How should we as traders confront risk?....
The first step is to respect it. Realize the damage it can do to our account equities when it is abused. The two most important tools that we have to control risk are stops and position size. Oh, I know, you hate stops. We all do. We have all been stopped out at the high or low only to see the market immediately move in the direction that we thought it would. But without using stops on every trade that we enter, disaster will eventually prevail. I have a love/hate relationship with my stop orders. I hate to place them, but love how they save me from large, unacceptable account crushing losses. It is the same for all successful traders. Those foolish enough to trade without stop protection are risking disaster on every trade. Unless you as a trader have developed perfect discipline to exit a losing trade quickly, and according to your pre-entry criteria, stops are mandatory. And admit it, at least to yourself.....do you have perfect discipline? I think not.
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Big and Bearish Downside "Breakout" in Cotton Futures
From our friend Jim Wyckoff
Jim has an excellent daily newsletter where he reviews different markets, alerts you for potential trades and much more. Included is his great bi-weekly newsletter with charts and a little longer term outlook. We recommend checking out his website, educational CDROM, and services at www.jimwyckoff.com click on image below to enlarge
See on the daily bar chart for December ICE cotton futures that prices this week have seen a big and bearish downside "breakout" from the choppy and sideways trading range at lower price levels. Prices Thursday scored a fresh contract low. The cotton bears are in full near-term technical control and looking for more on the downside in the near term.
Source: Moore Research Center, Inc.
| Date | Reports | Expiration & Notice Dates |
| 06/30 Mon |
8:45 AM CDT - Chicago PMI(Jun) 9:00 AM CDT - Pending Home Sales(May) 11:00 AM CDT - Grain Stocks 11:00 AM CDT - Planted Acreage |
FN: Jul Wheat(CBT) Jul Corn(CBT) Jul Oats(CBT) Jul Rough Rice(CBT) Jul Soybeans,Soymeal,Soyoil(CBT) Jul Copper(CMX) Jul Silver,Gold(CMX) Jul Platinum,Palladium(NYM) LT: Jun 2,5 Year Notes(CBT) Jun Fed Funds(CME) Jun Live Cattle(CME) Jul RBOB & ULSD(NYM) Jul Sugar-11(ICE) Jun Fed Funds Options(CME) Jul Lumber Options(CME) |
| 07/01 Tues |
9:00 AM CDT - Construction Spending(May) 9:00 AM CDT - ISM Index(Jun) 1:00 PM CDT - Auto & Truck Sales(Jun) |
FN: Jul Orange Juice(ICE) Jul Sugar-11(ICE) LT: Jun Butter(CME) Jun Milk(CME) Jun Butter Options(CME) Jun Milk Options(CME) |
| 07/02 Wed |
6:00 AM CDT - MBA Mortgage Price Index 6:30 AM CDT - Challenger Job Cuts(Jun) 7:15 AM CDT - ADP Employment Change(Jun) 9:00 AM CDT - Factory Orders(May) 9:30 AM CDT - API & DOE Energy Stats 3:00 PM CDT - Dairy Products Sales |
FN: Jul RBOB & ULSD(NYM) |
| 07/03 Thurs |
7:30 AM CDT - USDA Weekly Export Sales 7:30 AM CDT - Initial Claims-Weekly 7:30 AM CDT - Nonfarm Payrolls(Jun) 7:30 AM CDT - Unemployment Rate(Jun) 7:30 AM CDT - Ave Workweek & Hourly Earnings(Jun) 7:30 AM CDT - Trade Balance(May) 9:00 AM CDT - ISM Services(Jun) 9:30 AM CDT - EIA Gas Storage 3:30 PM CDT - Money Supply |
LT: Jul Canadian Dollar Options(CME) Jul Currencies Options(CME) Jul Live Cattle Options(CME) Jul US Dollar Index Options(ICE) Aug Cocoa Options(ICE) |
| 07/04 Fri |
INDEPENDENCE DAY |
|
| 07/07 Mon |
* 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!