Having a Trading Plan

Stochastics are putting in a rounding bottom and though we’ve not recommitted capital in futures with clients we still recommend accumulating call spreads in May as oil should be turning higher very soon. Looking at the chart formation we could be forming a “W” which predicts a trade back above $80 in the next 90 days. Just my opinion others may see it differently. Natural gas traded below $5.10 in March and was rejected but we would suggest further evidence before trying to catch this falling knife.
In Monday’s commentary we will post a few long trade suggestions. We will see on the close but at the moment if we were to close at these levels I see a bearish engulfing candle on the daily chart in Indices. Some or our clients started shorting the ES today; we suspect a bit premature thinking a trade to 1125 is feasible. At that level we suggest short exposure. OJ prices were lower by almost 2% today; clients remain long and still need higher pricing to reach their profit objective. Sugar was higher by 2.25% though we are still anticipating a breach of the 20 day moving average and more downside before re-establishing longs for clients. I was impressed with the action in metals today; gold closed $14 off its lows back above the 50 day moving average and silver was unable to break $16/ounce paring its losses but still closing below the 100 day moving average. Because the mixed signals we maintain only having light long exposure.
Love the action in corn today as the 61.8% Fibonacci level held and a base looks to be forming. Clients are buying May and July calls and December futures. Expect to see some bullish recommendations in soy meal and soybeans in Monday’s commentary as well. Would’ve liked to see some follow through in the Euro-dollar today. Continue to scale into shorts at these levels. If the 20 day moving average holds into the weekend in lean hogs we most likely will suggest bullish exposure in April…stay tuned. As for live cattle clients are long June futures with put option protection. We’ve yet to make any plays for clients in August but you will know when we do. Continue to sell rallies in the Pound; some clients scalped 85 ticks today! On a challenge of 88 cents tomorrow in the March Aussie we suggest taking off your puts. The US dollar has gained 7 out of the last 10 sessions and we do NOT think it is sustainable. We are not suggesting shorts but if prices rollover the Ag’s, energies and metals could appreciate swiftly…trade accordingly.
Risk Disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.


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