 | | 5 Picks by Tom Zabroske, Walsh Trading |
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Tom Zabroske has been in the futures markets since 1978. Tom has lectured nationally and internationally on market cycles as well as other subjects, and has been a featured speaker at many futures conferences over the years. He writes a market commentary Monday thru Thursday concerning market cycles titled "Circuli Dominare," which is available through Walsh Publications Inc. Tom is currently the Senior Trader/Analyst as well as Director of Research for Walsh Trading Inc.
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| In the week ahead, the HGZ market, after today's dramatic drop should test the 350.0 level. At this point, when looking at the long-term monthly chart a purchase of the April 2009 Copper 250 puts at 4.00 would be an attractive trade. The monthly continuation chart of the nearby contract in the copper market made a monthly key reversal in May so trading the copper market from the short side is the way to go. While the copper market can be expensive and volatile for many traders, this deferred put is suitable for almost all traders.
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In the week ahead, the ESU market's sell off should be complete. Support on the daily time frame in the ESU is at 1235-1240 and a long position should be taken with a test of this support. Conversely, a close above resistance on the daily time frame at 1285 would signal the correction has been completed and a long position should be taken.
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In the week ahead, with the dramatic sell off in the CTZ, a close on the day in the CTZ below 7100 should be used to establish a short position. The monthly reversal on the monthly continuation chart of the nearby contract in March 2008 has kept the market in a clear position of trading from the short side. With the expected low based on the monthly time frame not due until December 2008, CTZ 6500 puts are quite attractive as is the 6500-5700 put spread with the expectation of seeing the market test its breakout level of 6000 in 2007.
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In the week ahead, with the weekly and monthly cycles in their respective down phases in the WZ, a close on the day in the WZ below support at 800 should be used to establish a short position. Over the long term a move in the nearby contract of wheat to 550-600 cannot be ruled out.
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A test of the previous low in the ECU at 152.43 is likely over the next number of weeks. A 152.00 put in the ECZ is attractive and if so inclined a sale of the 145.00 put to finance the position is attractive if an outright long put position is not your cup of tea.
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| | 5 Picks by Steven Petillo, Arc Capital Management |
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 Steven Petillo has been in the futures and forex industry since the early 90’s when he worked on the floor of the Chicago Board of Trade. Since then he has been the senior analyst and research director for FCMs and investment firms as well as a regular contributor to Futures Truth
. Mr. Petillo is now the president of Arc Capital Management, an investment firm dealing in futures, the foreign exchange markets and OTC energies with offices in Chicago, Dallas and throughout Texas. |
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| Beef has the fundamentals on its side this week. Stable feed prices and lower supply coupled with stronger demand than expected should keep the cash market strong this week. The October contract has a been of technical resistance at a gap closer in the 108.50 area so buyers are expected on pull backs for the next few days from these price levels. October Live Cattle technical support comes in around 106.00 and near 104.00.
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Expected crop production numbers could topple previous records. Earlier Iowa threat shouldn't be enough to overcome stellar crops in Illinois, Indiana & Wisconsin. The current weather conditions are favorable and more downside is expected. Traders also still following next years crop inverted spreads. September '09 corn is still trading at a discount to December '09. Technical zones for December '08 come in around 561; and 518' on the downside and 590' on the upside.
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Open interest growing and volatility increasing while long-term demand aspects continue to strengthen. High prices could be seen this week and buyers interested in any pull-backs. South America and ethanol are currently a primary focus. October support is seen around 13.25 and 12.60. Open interest in options has been increasing as well but volatility has caused many options to be overvalued.
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Although world demand has been stable, no short-term rise in construction in The States should keep pressure in copper futures. In December, no technical support seen until a challenge of the old lows around 3.4200. Look traders to jump in on corrective rallies and keep a close eye on spreading activity. Many months trading very tight or fully inverted.
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This week we expect the recent lows to hold for now but we'll have a watchful eye on the inventory levels as usual. Volume could be lighter than normal and speculators very interested in RBOB over Crude spreads. October lows currently holding support just under 121.00 and 2.9000 in RBOB. Short term widening of RBOB demand expected over Crude.
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