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THE JOSS REPORT NOVEMBER 12, 2006 |
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TECH TALK BY Scott R. Joss (Non member C.T.A)*
JANUARY SOYBEANS (SF7)
In the Joss Report dated October 15th, I moved January Soybeans to ‘Tech Talk’ due to the explosive breakout from 577.00 and subsequent upside price advance.
This product is not for the faint of heart because of the higher or lower openings each day - which can be dramatic.
On 10/25/06, January Soybeans posted an unconfirmed yearly buy signal at 643.00.
As long as January Soybeans continue to post monthly closes at or above 643.00, funds will hold on to their long positions.
For several weeks I’ve been writing about the narrowing of the Soybean versus Corn price ratio spread - typically at 2.3 to 2.5.
Currently, the ratio price spread has narrowed to 1.84 - 1.88 versus the previous week of 1.88 - 1.92.
This narrowing of the Soybean/Corn ratio spread will influence the farmer to plant more Corn instead of Soybeans this spring.
The ‘Commitment of Traders’ report - published each Friday by the CFTC – was not published this week due to Veterans Day.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk next week will be $2,400.
If you do not fit this risk profile, traders are advised to consult with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
Aggressive traders who established a long position at 577.00 or above are advised to move their stops below 615.00 or exit their positions*.
Option traders who purchased January 580 calls are advised to risk 50% of current market price or exit their option positions**.
Aggressive traders who either added to their long position or established a long position on a price pullback to 573.00 are advised to move their stops below 615.00 or exit their positions*.
Option traders who purchased January 600 calls are advised to risk 50% of current market value or exit their option positions**.
Aggressive traders who either added to their long position or established a long position at 582.00 or above are advised to place their stops below 615.00 or exit their positions*.
Option traders who purchased January 600 calls are advised to risk 50% of current market value or exit their option positions**.
Aggressive traders who either added to their long position or established a long position at 591.00 or above are advised to place their stops below 615.00 or exit their positions*.
Option traders who purchased January 620 calls are advised to risk 50% of current market value or exit their option positions**.
Aggressive traders who either added to their long position or established a long position on multiple closes above 612.50 are advised to place their stops below 615.00 or exit their positions*.
Option traders who purchased January 640 calls are advised to risk 50% of current market value or exit their option positions**.
Aggressive traders who either added to their long position or established a long position on multiple closes above 627.00 are advised to place their stops below 615.00 or exit their positions*.
Option traders who purchased January 640 calls are advised to risk 50% of current market value or exit their option positions**.
Very aggressive traders who either added to their long position or established a long position on closes above 655.00 are advised to place their stops below 615.00 or exit their positions*.
Option traders who purchased January 640 calls are advised to risk 50% of current market value or exit their option positions**.
# 1) If January Soybeans post a price decline towards 626.00:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 615.00*.
Option traders are advised to purchase January 600 calls, risking 70% of purchase price**.
# 2) If January Soybeans posted 682.00 and multiple closes above 683.25****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 641.50*.
Option traders are advised to purchase January 680 calls, risking 70% of purchase price**.
# 3) If January Soybeans post multiple closes above 696.00****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 639.00*.
Option traders are advised to purchase January 700 calls, risking 70% of purchase price**.
Our objective will be 724.50.
# 4) If January Soybeans post multiple closes above 738.00****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 672.00*.
Option traders are advised to purchase January 720 calls, risking 70% of purchase price**.
# 5) If January Soybeans post multiple closes above 757.50****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 694.00*.
Option traders are advised to purchase January 740 calls, risking 70% of purchase price**.
Our objective will be 800.75.
DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?S07F
-----------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?S
MARCH COTTON (CTH7)
Last week I added March Cotton to ‘Tech Talk’ due to a pending trade signal on the weekly chart.
March Cotton has been in a nine-week price decline that began from highs of 60.35 (8/07/06) to current lows of 51.25 (10/18/06).
Recently, March Cotton has traded from lows of 51.25 to highs of 54.50 (11/8/06), which was just shy of a .382 Fibonacci retracement.
Last week I wrote about the ratio price spread between Soybeans and Cotton.
Typically, the price ratio differential between the Soybeans and Cotton is 10.0; currently the differential is between 12.6 and 12.4.
March Cotton has two unfilled price gaps above the current market price. The most recent unfilled price gap is between 56.90 and 57.20.
This product is not for the faint of heart because of the higher or lower openings each day - which can be dramatic…. and the vicious personality of this product.
The ‘Commitment of Traders’ report - published each Friday by the CFTC – was not published this week due to Veterans Day.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk for the month of November will be $1,410.
If you do not fit this risk profile, traders are advised to consult with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
The trading modules listed below are for very aggressive traders. Less aggressive traders are advised to wait for several trade signals before establishing a position.
# 1) If March Cotton posts 54.06 and multiple closes above 54.50****:
Very aggressive traders are advised to establish a long position, placing all stops below 52.20 and refer to trading module # 6*.
Option traders are advised to purchase March 55 calls, risking 70% of purchase price**.
# 2) If March Cotton posts multiple closes above 55.05****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 52.40*.
Option traders are advised to purchase March 56 calls, risking 70% of purchase price**.
# 3) If March Cotton posts multiple closes above 56.40****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 53.80*.
Option traders are advised to purchase March 57 calls, risking 70% of purchase price**.
Our objective will be 57.20.
# 4) If March Cotton posts multiple closes above 57.70****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 54.05*.
Option traders are advised to purchase March 58 calls, risking 70% of purchase price**.
# 5) If March Cotton posts multiple closes above 58.30****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 56.40*.
Option traders are advised to purchase March 59 calls, risking 70% of purchase price**.
# 6) If March Cotton posts 51.84 and multiple closes below 51.25****:
Very aggressive traders are advised to establish a short position, placing stops at 53.00 and refer to ‘trading module’ # 1*.
Option traders are advised to purchase March 52 puts, risking 70% of purchase price**.
# 7) If March Cotton posts multiple closes below 51.25****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 52.40*.
Option traders are advised to purchase March 51 puts, risking 70% of purchase price**.
Our objective will be 48.50.
# 8) If March Cotton posts multiple closes below 48.40****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 51.25*.
Option traders are advised to purchase March 49 puts, risking 70% of purchase price**.
# 9) If March Cotton posts multiple closes below 47.80****:
Very aggressive traders are advised to either add to their existing short positions or re-establish a short position, placing all stops above 51.25*.
Option traders are advised to purchase March 47 puts, risking 70% of purchase price**.
Our objective will be 45.00.
DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?CT07H
-----------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?CT
DECEMBER SILVER (SIZ6)
In the Joss Report dated October 15th, I added December Silver to ‘Tech Talk’ due to a trade signal on the weekly and currently on the monthly chart.
On 10/16/06, December Silver posted a buy signal on the weekly chart.
On 11/01/06, December Silver posted a buy signal on the monthly chart.
The daily chart has developed a bullish ‘W’ formation.
If this bullish formation were to continue, December Silver must continue to post closes above the middle of the ‘W’ of 11.840.
This product is not for the faint of heart because of the higher or lower openings each day - which can be dramatic due to extreme volatility.
The ‘Commitment of Traders’ report - published each Friday by the CFTC – was not published this week due to Veterans Day.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk for next week will be $5,600.
If you do not fit this risk profile, traders are advised to consult with their account executive for an option trading strategy or trade mini Silver contracts.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
Aggressive traders who established a long position at 11.730 or above are advised to move their stops below 11.980 or exit their long position*.
Aggressive traders who either added to their existing long position or established a long position on a price decline to 11.455 are advised to move their stops below 11.980 or exit their long position*.
Aggressive traders who either added to their existing long position or established a long position on, at, or above 12.310 are advised to move their stops below 11.980 or exit their long position*.
Aggressive traders who either added to their existing long position or established a long position on, at, or above 12.680 are advised to move their stops below 11.980 or exit their long position*.
Aggressive traders who either added to their existing long position or established a long position on, at, or above 12.890 are advised to move their stops below 11.980 or exit their long position*.
Our objective of 13.100 was met this past Friday.
# 1) If December Silver posts a price decline to 12.280****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 11.820*.
# 2) If December Silver posted 13.145 and multiple closes above 13.370****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 12.520*.
# 3) If December Silver posted multiple closes above 13.500****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 12.850*.
Our objective will be 13.900.
DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?SI06Z
-----------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?SI
DECEMBER GOLD (GCZ6)
In the October 15th Joss Report, I moved December Gold to ‘Chart Watch’ due to a pending trade signal on the weekly chart.
Last week, I moved December Gold to ‘Tech Talk’ due to a bullish ‘head and shoulders’ bottom.
The left shoulder developed between lows of 576.60 and highs of 612.40.
The head established itself between lows of 563.50 and highs of 595.00.
The right shoulder is developing between lows of 573.00 and highs of 604.00.
The downward sloping ‘neckline’ breakout was at 600.00.
Multiple closes above 615.40 have confirmed a bottom is in place.
The upside price objective from the ‘head and shoulders’ is 648.90.
As long as December Gold continues to post monthly closes at or above 615.40, funds will hold on to their long positions.
December Gold has two unfilled price gaps above the current market price. The first unfilled price gap is between 637.50 and 641.00. The second unfilled price gap above the current market price is between 699.00 and 700.00.
For Monday, December Gold has developed a pending trade signal.
The ‘Commitment of Traders’ report - published each Friday by the CFTC – was not published this week due to Veterans Day.
This product was and is for very aggressive traders only.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed risk next week will be $3,670.
If you do not fit this risk profile, traders are advised to consult with their account executive for an option trading strategy or trade mini Gold contracts.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
Aggressive traders who established a long position at 604.00 are advised to place their stops below 600.50 or exit their long position using a resting stop at 626.40*.
Aggressive traders who either added to their long position or established a long position at 612.40 are advised to place their stops below 600.50 or exit their long position using a resting stop at 626.40*.
Aggressive traders who either added to their long position or established a long position at 615.50 are advised to place their stops below 600.50 or exit their long position using a resting stop at 626.40*.
Aggressive traders who either added to their long position or established a long position at 615.50 are advised to place their stops below 600.50 or exit their long position using a resting stop at 626.40*.
Aggressive traders who either added to their long position or established a long position at 622.60 are advised to place their stops below 600.50 or exit their long position using a resting stop at 626.40*.
Aggressive traders who either added to their long position or established a long position on a price decline to 612.40 (11/8/06) at 617.80 or above, are advised to place stops below 600.50 or exit their long position using a resting stop at 626.40*.
# 1) If December Gold posted 635.90 and multiple closes above 637.00****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 615.20*.
Our objective will be 641.00.
# 2) If December Gold posted 647.00 and multiple closes above 648.50:
Aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 635.80*.
# 3) If December Gold posted multiple closes above 655.70:
Aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 647.00*.
# 4) If December Gold posted 666.50 and multiple closes above 668.20:
Aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 655.70*.
# 5) If December Gold posted 678.50 and multiple closes above 683.00:
Aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 666.50*.
Our objective will be 700.00.
DAILY CHART:
http://www.bohlish.com/d_Chart.cgi?GO06Z
-----------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?GC
DECEMBER 10-YEAR NOTE (TYZ6)
For several weeks the December 10-year Note was added to ‘Chart Watch’ due to varying trade signals.
Last week the December 10-year note was added to ‘Tech Talk’ due to a pending trade signal on the monthly chart.
If the December 10-year Note does not post a buy or sell trade signal on the monthly chart by the end of November, then new ‘trading modules’ will be posted for the March 10-year note contract.
The December 10-year Note has an unfilled price gap below the current market price at 104-130 (7/06/06).
On 11/03/06, the December 10-year Note posted a sell signal at 108-065.
On 11/10/06, the December 10-year Note posted a buy signal at 108-055.
The ‘Commitment of Traders’ report - published each Friday by the CFTC – was not published this week due to Veterans Day.
This product was and is for very aggressive traders only.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.
The proposed trade risk for November will be $2,110.
If you do not fit this risk profile, traders are advised to consult with their account executive for an option trading strategy.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures traders to consider next week:
The trading modules listed below are for very aggressive traders. Less aggressive traders are advised to wait for several trade signals before establishing a position.
Very aggressive traders who established a short position at 108-065 have exited their short position at 108-055 or are advised to exit their short position.
# 1) If the December 10-year Note posts 108-195 and multiple closes above 108-240:
Very aggressive traders are advised to establish a long position, placing stops at 106-185 and refer to ‘trading module’ # 4*.
# 2) If the December 10-year Note posts multiple closes above 109-235:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing stops below 107-100*.
# 3) If the December 10-year Note posts multiple closes above 110-060****:
Very aggressive traders are advised to either add to their existing long position or establish a long position, placing stops below 108-310*.
Our objective will be 110-190.
# 4) If the December 10-year Note posts 106-210 and multiple closes below 106-190:
Very aggressive traders are advised to either add to their existing short position or establish a short position, placing stops at 108-220 and refer to ‘trading module’ # 1*.
# 5) If the December 10-year Note posts multiple closes below 106-135****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 107-125*.
# 6) If the December 10-year note posts multiple closes below 106-095 ****.
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 106-280*.
# 7) If the December 10-year note posts multiple closes below 105-240 ****:
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 106-220*.
# 8) If the December 10-year note post 105-115 and multiple closes below 105-080 ****.
Very aggressive traders are advised to either add to their existing short positions or establish a short position, placing all stops above 105-240*.
Our objective will be 104-130.
# 9) If the December 10-year Note does not post 106-185 or 108-220 by the close of business November 30th:
Aggressive traders will be advised of a new set of ‘trading modules’ for the March 10-year Note contract in the December 3rd issue of the Joss Report.
DAILY CHART:
http://www.bohlish.com/d_Chart.cgi?TY06Z
-----------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?TY
MARCH SUGAR (SBH6)
Two weeks ago, March Sugar was featured in ‘Tech Talk’ because of a pending trade signal on the weekly chart.
I stated that ‘It appeared March Sugar’s consolidation period had begun as long as March Sugar traded between lows of 10.66 and highs of 12.65’.
Traders were and are advised to watch the 2005 key upside bullish ‘W’ breakout at 11.40 as this is a pivotal level.
March Sugar has five unfilled price gaps above the current market price. The most recent unfilled price gap is between 13.59 and 13.96 (11/8/06).
March Sugar has several unfilled price gaps below the current market price. The most recent unfilled price gap is between 9.78 and 9.81 (9/2/05).
The ‘Commitment of Traders’ report - published each Friday by the CFTC – was not published this week due to Veterans Day.
This product is for aggressive traders only.
Traders are advised not to exceed the rule of thumb - 10% of equity to risk ratio.