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- Joe Kellogg |
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Today's Featured Article
December Dow Jones
- Dow Jones futures rallied as the dollar slid to a new low after the Group of 20 nations agreed to maintain economic stimulus efforts. The Dow Jones futures rallied to a new high and crossed over the ascending median line. This is a momentum indicator, suggesting the upward trend is still intact with a short-term target objective at 10275 and longer-term target objective of 10525. The next reversal swing date is due on November 19.
 If you cannot view the Dow Jones chart,
go here.
December Japanese Yen
- Short from 1.1020 - exit price @ 1.1125 - The original short position was closed @ 1.1125 for a loss after the Yen reversed course, following a rebound off the 20-day SMA. The low close on 11/4 formed a new bullish swing pattern on the 20-day SMA and provided a springboard from the newly formed bullish reaction swing. This pattern also signaled an end to the short-term downward correction and the resumption of the prevailing bullish trend. The new TR pattern portends an upward move to the 1.145 target objective on or before the next reversal swing date, due on 11/18.
 If you cannot view the Japanese Yen chart,
go here.
December British Pound
- Long from 1.6480 - last price @ 1.6755 - The British pound traded above the ascending median (center line) on the second test since October 23rd and one day prior to the reversal swing date...due on November 10. It is time to raise the profit stop as a precaution to a possible reversal. Hold the long position and raise the stop to 1.6605.
 If you cannot view the British Pound chart, go here.
December Eurocurrency
- The EU has formed a short-term reaction swing pattern inside the longer-term reaction swing. The market rallied off this pattern on Monday and closed sharply higher. However, this type of pattern is typically followed by several higher days, so there is still time to enter on a slight pullback. Buy the EU at 1.4945 or lower, with a stop loss at 1.4820.
 If you cannot view the Euro chart, go here.
In an active futures market, price patterns and signals are constantly changing. Because of this volatility, changes to recommended market positions can change intra-day.
Go here to learn more about intra-day changes.
December Copper
- Long from 299.75 - last price @ 297.65 - Codelco will increase the sale surcharge on copper for clients in Japan and South Korea by as much as 16 percent. This is the first increase since 2007 and is a result of renewed demand from China, who is currently the world's largest consumer. Copper continues to find support at the 20-day SMA, but has been moving sideways into the November 10 reversal swing date. Hold the long position and move the stop loss to 294.25.
 If you cannot view the Copper chart,
go here. |
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December Lean Hogs
- Long from 54.30 - exit price @ 56.67 - Lean Hogs traded above the prior high and fell just short of reaching the sloping reaction line target objective, but profit-taking reversed the market. Hogs reversed and traded below yesterday's low, forming an outside day with a negative close, signaling the rally is over. Therefore, I recommended exiting the long position at market. The position was closed at 56.67 for a nice gain. In the last two sessions, Lean hogs have lost over 290 points, but may be ready to find support at the 20-day SMA. This may mark the beginning of a rebound and test of the recent high. I need to see more price action before taking another position.
 If you cannot view the Lean Hogs chart,
go here.
March Sugar - Heavy selling pressure has pushed the market below the 20-day SMA, where Sugar did find support at the lower parallel line. The market is still in the consolidation phase and is showing a possible TR pattern...so I think you still want to keep Sugar on your trading radar. A rally above 23.95 will confirm the bullish pattern and trigger the next run.
 If you cannot view the Sugar chart,
go here.
December Crude Oil
- A new day and a new direction for the Crude oil and Friday's dismal jobs report pressured the market and closed the long position at 79.05 for a loss, but weekend weather reversed the trend for Monday. It is hard to find a direction, with the news changing daily and sometimes hourly. On the other hand, the chart is showing a potentially bullish reaction swing forming inside the wider reaction swing. If confirmed, this type pattern can be very powerful and trigger strong price action. Buy the Crude oil at 80.55 stop, with a stop loss under the pivot low.
 If you cannot view the Crude Oil chart,
go here.
December Heating Oil - The swing pattern failure has formed a bullish "setup" for the Heating oil. A trade above Monday's high will trigger a buy signal and portend a rally to test the prior high. Buy Heating oil at 2.0925 stop, with the stop loss below 2.0105.
 If you cannot view the Heating Oil chart,
go here.
December Corn
- Nov. 9 (Bloomberg) - China is estimating that its Corn production will be much less than previously forecast. The world's second largest producer estimates production has plunged by a more-than-estimated 13 percent to a four-year low because of droughts in the main growing regions. Traders will be watching Monday's afternoon's Crop Progress Report and Tuesday morning's Crop Production Report for information and clues as to the direction in Corn futures. Early estimates suggest traders are expecting to see 35% to 45% of harvest complete. Corn has formed an interesting pattern over the past few days that could trigger a move in either direction.
 If you cannot view the Corn chart,
go here. |
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REVERSAL DATES FOR THE WEEK of November 9-13, 2009
Monday -- Hogs, S&P, Dow Jones
Tuesday -- Soybeans, Copper, T-Bonds, British Pound, Swiss Franc
Wednesday -- Corn, Japanese Yen
Thursday -- Sugar
Friday -- Crude Oil, RBOB Gas, Heating Oil, Gold, Swiss Franc
If you have questions about swing trade recommendations, sign up for "The Scientific Trader," a 15-page electronic booklet about the Swing Trading Phenomenon. *Due to the volatility of the markets, all trade recommendations are subject to change without notice.
Swing trading and Reversal dates
Every good trading signal needs three key elements to be considered a successful signal. Time, Price and Pattern. When these three come together, great things can happen. If you can improve your timing or price entry, it can enhance any trading method. That is what the Reversal Dates can do for you. They will identify when the market should react, and at what price level the market needs to be for this to happen. They will even tell you what the market has to do to confirm the trade. The first thing I do is, identify Time.
TIME
The Reversal Date Indicator consists of three parts. The first is Time. This is identified by the projected Reversal date and will indicate which markets are ready to react and when the reaction should occur. The most common misconception about the Reversal dates is the idea that the market must reverse on every signal date, which is not true. Instead, The Reversal Date itself helps to identify the market's reaction. A high percentage of the time, the market will reverse the current trend, but not always. A smaller percentage of the time, the market will form a "continuation pattern," indicating the market will likely continue in the same direction as the prevailing trend. Often this
will occur during a consolidation or after a very small correction.
PRICE
Once the Reversal date has been identified, the next thing to do is monitor the price. If the market is making a new high/low, or if it is trading inside a buy/sell window, then the second component of a trade signal is in place. You now have Time and Price working together. For most traders, that will be enough, but the Reversal Date Indicator takes it one step further.
PATTERN
After extensive research into price patterns, I have identified specific price patterns, which occur during reversal timing. These patterns can be used to confirm the market reversals or market continuations. When, and only when, these three components are all working together, will there be a trade signal generated.
Traders Market Views is a product of Traders Network and all statements herein reflect Traders Network's market research. Traders Network and/or its principals, brokers and employees may or may not have established positions in part or all of the markets herein mentioned. It is possible that some of those positions, if any, are in direct conflict with the market commentary herewith.
THE RISK OF LOSS IN TRADING COMMODITY CONTRACTS CAN BE SUBSTANTIAL. YOU SHOULD, THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER OR OVER-COMPENSATED FOR THE IMPACT IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT
ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES.
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About the Author
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Joseph Kellogg started in the commodity business as a commercial grain merchandiser and basis trader. He was one of the architects of the Farm Marketing Program (FMP). This marketing plan was designed for agricultural businesses to use with grain options in strategies that could not only hedge their cash crops, but also aid in their marketing. He hosted "Futures Talk," a commodity talk radio program that aired bi-weekly on a Los Angeles radio station. Joseph has also developed many option writing strategies, which can be used with the reversal point method. |
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Special Message from Our Author
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