WELCOME TO THE JOSS REPORT - WEEKLY TRADE ADVISOR
The Joss Report trading recommendations and weekly trade advisor newsletter was first published in October 1998. Since that time, the Joss Report research has continued to evolve into an important source of technical insight for many traders. Our goal is to provide traders with a 'trading plan' to prepare for the trading day and week ahead.
ClearTrade's own technical analyst, Scott Joss*, is a veteran futures trader with twenty-eight years experience on and off the trading floor - as a technical analyst, pit trader, account executive handling arbitrage for Smith Barney, former member of the CBOT, non-member CTA and presently an IB. Scott prepares technical analysis in selected market groups when an opportunity presents itself and not only develops 'trading modules' on selected trading opportunities but 'feeds-forward', advising traders what to expect and how to react.
 At ClearTrade, we think it’s helpful to speak directly with traders who have requested The Joss Report research and may be interested in establishing an account with us. Understanding your trading needs and goals is important. And we think you should have an opportunity to get to know who we are and what we offer on a one to one basis.
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The Joss Report Weekly Trade Advisor should be used in conjunction with the Joss Report Daily Recommendations, Weekly Recommendations and Monthly Recommendations.

The Joss Report Archived Weekly Trade Advisor 2005
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• TECH TALK - SUGAR - NASDAQ - SOYBEANS - NATURAL GAS EN-TYEAR NOTES
•  CHART WATCH - COTTON - COPPER
•  CURRENT 'MONTHLY' RECOMMENDATIONS
•  FUTURES WATCH
•  COMING EVENTS AND DATA RELEASES

TECH TALK by Scott R. Joss (Non member C.T.A)*

MARCH SUGAR (SB6H)
This week I advise traders who have established long positions over the past fifteen-weeks in the October Sugar contract to roll their trade positions into the March contract. In addition, I will begin developing an exit strategy for options traders who have purchased March 110 and 120 calls.
Almost four-weeks ago I wrote that October Sugar, unlike the back months, had formed a bearish ‘head and shoulders’ top. Sugar needed a price pullback to work off many weeks of excess buying. The question remained as to how deep the pullback would be.  The all-important ‘neckline’ had an upward sloping trendline and any price pullback should be shallow.
Two-weeks ago, I explained how by measuring from the high of the left shoulder at 9.99 and by subtracting from the low of the left shoulder at 9.75, an anticipated potential low of 9.51 might be reached.
On 8/22/05, October Sugar posted a low of 9.50.
Since posting lows of 9.50, October Sugar prices have advanced to highs on Friday of 10.34.
The high posted Friday at 10.34 almost matched contract highs of 10.35, which were posted on 8/04/05.
Could October Sugar have posted a bearish ‘spread double’ top or will this be the catalyst for the next major price advance?
The next several weeks will be important in determining this.
Let’s prepare for both a price decline and a major price advance.
Let’s begin a review of the March contract.
The March Sugar chart has a very different pattern than October Sugar - which I attribute to spreading.
The spreaders - as I mentioned two-weeks ago appeared to be rolling from the front month of October to the fast approaching front month of March.
Traders were selling October Sugar and buying March Sugar. The spread had varied with October prices - trading 10 above March’s price - to trading 62 below.  On Friday‘s close the spread was 42.
The spread appears to be narrowing as local spreaders may have extended the price discrepancy between October and March a little too far. Spreaders - sensing they might be trapped short October and long March - have begun to unwind their positions. By unwinding their spreads, March Sugar was unable to advance Friday and made a feeble attempt to match recent contract highs of 10.79, which were posted on 9/06/05.
Each week I stress to traders that the Sugar ‘trading modules’ I develop are long-term trades that may span a year or more to achieve. Because of the possible length of the trade, traders have been advised to establish long positions in March 2006 futures and options, then rolling forward as time approaches.
The long positions in Sugar were based originally on daily, weekly, and monthly trade signals from the July contract, then the October contract - and now, the March contract.
The ‘Commitment of Traders’ report - published each Friday - indicated that the change in open interest increased for the second week. Last week by 9,456 contracts and this week 8,649, posting a total open interest of 483,634 contracts. 
This week’s ‘Commitment of Traders’ report bothers me because the long commercial hedgers  - as opposed to the short commercial hedgers -  are liquidating their positions at a rate of 9 to 1.
Then how is the open interest increasing? The non-commercial - or small speculator - is taking on the risk by increasing their long positions. This may not be a good sign unless it can be attributed to the expiration of the October options this past Friday.
I noticed on Friday that March option prices would not budge higher when futures prices surged. As a matter of fact, they lost value.  This too is not a good sign - because options traders seem to have a sixth sense when a top or bottom is posted.
Don’t despair; traders need to remember the July futures contract also had a very large short open interest going in to first notice day. Everyone worried that Sugar would collapse with such a huge short position - however, just the opposite happened.  
In came Cargill, the major Ag conglomerate, taking delivery against the futures contract. Sugar posted a 1.13-cent price advance.
Can this happen again?  Sure… but a price correction is still not out of the question because first notice day is less than three-weeks away. We’ll see next week.
 
It’s my belief that Non-Commercial Funds and many Commercial Dealers believe that Sugar is not just an agricultural product anymore but an energy source - which may be influenced by Crude Oil.
WHAT ARE THE FUNDAMENTALS OF SUGAR?
Two-weeks ago, Crude surged to $70 a barrel because of the devastating disaster in Louisiana.
Louisiana supplies the Midwest and Eastern Coast with crude oil, natural gas, and is the second largest sugar grower in the U.S.
Last week, under heavy pressure, the energy secretary made a quick fix by dipping into the strategic oil reserve. By adding oil reserves to the market, crude prices have drop back to $64.
Because there is still a threat of high oil prices in the future, many countries are now making preparations for alternative fuels such as sugarcane ethanol. Below are excerpts from a news article issued to German car manufactures.
German car giants outsmarted by Brazilian sugar cane
While economic growth forecasts for leading industrial nations are overshadowed by fuel price volatilities, Brazil has taken the lead in a quiet transport revolution, reducing significantly its dependence on foreign oil supplies. According to the Brazilian Ministry of Transport most of Brazil’s 20 million cars run already on gasoline mixed with 25% of sugar cane generated ethanol; and an ever increasing number of new cars in Brazil drive on 100% ethanol...
Alfred Szwarc, energy specialist and adviser to UNICA, the Sao Paulo Sugarcane Agroindustry Union, points out that over the past 30 years; Brazil has been producing ethanol from sugar cane and using it in automobiles across the country. “It is high time that industrialized countries start to use gasoline mixed with ethanol to mitigate their volatility to rocketing oil prices and to help stop global warming”, says Szwarc.
Brazil has the capabilities to turn into one of the worlds’ largest bio fuel exporters, as a fleet of ethanol tankers will help to feed the energy hungry economies of India, China and Korea. Even in the U.S.
Ernst Ludwig Winnacker, the president of the Deutsche Forschungs Gesellschaft (industry research council), gave a stern warning to the German automobile industry not to miss crucial car innovation trends. "There are cars in the world, which offer the same performance by using only half the amount of gasoline. I find it alarming that German car manufacturers can’t supply this technology today".
Another interesting news article presents the first agricultural-based foam insulation.
Apex Debuts Renewable Resource-based Foam Insulation
Apex Foam Industries has introduced EARTHSEAL FOAM .5 a non-ozone depleting, renewable resource-based SPF open-cell foam insulation.
EARTHSEAL FOAM .5 replaces the use of high priced petroleum-based polyols with those found in native, renewable resources: sugar cane and corn.
What damage has Hurricane Katrina done to farmers in Louisiana?
Not a lot has been reported in recent days but an excerpt from one local journalist doesn’t paint an encouraging picture.
Louisiana farmers count the costs of Katrina Friday, September 9, 2005, 2:49 PM
The Louisiana farmers predict that total agricultural losses could top $1 billion by the time all expenses are accounted for.
Some of the biggest losses are being suffered by the region’s forestry industry. Experts in the state say the logging industry may suffer a hit of more than $700 million. But the estimates continue to climb, as more damage is surveyed by producers and officials
The toll for livestock producers is rising too, as they work to manage herds and relocate animals to safer facilities. It is expected that dairy producers will lose more than $21 million due to the disaster.
Sugarcane producers have all seen their crops wiped clear out of the fields. Citrus growers are returning to the region and finding their trees splintered and withered from the storm’s high winds and devastating floods. While most of the state’s cotton, rice and soybean growing regions were untouched by the severe weather.
In addition, recently there are several news articles expressing concern over sugar supplies.
As flood waters recede along the Gulf Coast, the economic impact resulting from the devastation wrought by Hurricane Katrina is rising and beginning to be felt in Berks County, users of sugar from Louisiana refineries.
Richard L. Hartman, president of Clover Farms Dairy, Muhlenberg Township, said that since Aug. 31, his company has had to find alternate suppliers for the sucrose it uses in its Icy Tea and fruit drinks.
"We found a supply, but it's coming from Canada, and of course will cost about 40 percent more".
PORT OF SPAIN, Trinidad (AP)--A shortage of refined sugar in Trinidad has forced Pepsi-Cola and several other companies to halt local production, officials said Tuesday.
The shortage comes as the island's Sugar Manufacturing Company Limited, a state-owned refinery, has been unable to meet demands because of a shortage of raw sugar from Belize and Guyana, according to a statement released by the island's Ministry of Trade and Industry.
Pepsi Trinidad said it will halt production at the end of the day Tuesday, said Noel Rose, operations director.
 
WHAT ARE THE TECHNICALS OF SUGAR?
My belief technically and fundamentally is that sugar prices will go much higher - not only in the short-term but in years to come - based on two very bullish ’W’ formations. These ’W’ formations have developed on the daily, weekly and monthly charts. 
On 9/22/05, the all-important Sugar and Sweeteners Outlook Summary will be released.
On 9/30/05 is the last trading day for October Sugar futures.
Let’s continue to discuss the March Sugar chart, which is markedly different from the October chart.
March Sugar has been in a multi-year price advance, which began from lows of 6.12 (2/13/04) to recent highs of 10.79 (9/06/05).
March Sugar began its current price advance from lows of 8.29 (5/05/05) to recent highs of 10.79 (9/06/05).
Recently, March Sugar had developed a bullish downward flag formation - where the October contract had formed its ‘head and shoulders’ top.
The downward flag formation began from highs of 10.34 to lows of 9.85 (8/22/05).
On 8/24/05, March Sugar posted a daily buy signal at 9.97. Penetration of the downward sloping trendline of the bull flag occurred at 10.06.
On 8/24/05, March Sugar posted a weekly buy signal at 10.18.
Our objective on the upside from the bullish flag was 10.55, which was met on 8/30/05.
March Sugar has eight unfilled price gaps above the current market price, which are listed each week at the bottom of this ‘trading module.’
March Sugar has five unfilled price gaps below the current market price. The most recent unfilled price gap is between 10.21 and 10.23. The next unfilled price gap is between 9.96 and 10.00.
For twelve-weeks March Sugar has closed above its 40-day moving average and 50-day moving average - which as of Friday was at 10.11 and 9.99, respectively.
Sugar closed Friday at 10.72, which is above its 100-day moving average of 9.40 and its 200-day moving average of 9.18.
Listed below are the original signals that Sugar has posted in the last fifteen-weeks.
On 5/18/05, July Sugar posted a weekly buy signal at 8.54.
On 6/17/05, July Sugar posted an ‘intra-weekly’ buy signal at 9.04.
On 7/07/05, October Sugar posted a major price breakout by posting a weekly close above past contract highs of 9.45 from 3/17/05.
On 7/13/05, October Sugar posted a daily buy signal at 9.55.
On 7/15/05, October Sugar posted its second weekly close above the major price breakout of 9.45 from 3/17/05.
On 7/21/05, October Sugar posted an ‘intra-day’ buy signal at 9.55.
On 7/22/05, October Sugar posted an ‘intra-week’ buy signal at 9.60.
On 7/22/05, October Sugar posted its third weekly close above the major price breakout of 9.45 from 3/17/05.
On 7/25/05, October Sugar posted a daily buy signal at 9.74.
On 7/29/05, October Sugar posted its fourth weekly close above the major price breakout of 9.45 from 3/17/05.
On 8/01/05, October Sugar posted an ‘intra-day’ buy signal at 10.00.
On 8/02/05, October Sugar posted an ‘intra-week’ buy signal at 10.00.
On 8/08/05, October Sugar posted a daily sell signal at 10.06.
On 8/15/05, October Sugar posted a weekly sell signal at 9.76.
On 8/24/05, March Sugar posted a daily buy signal at 9.97. 
On 8/24/05, March Sugar posted a weekly buy signal at 10.18.
On 8/29/05, March Sugar posted a daily buy signal at 10.22.
On 9/06/05, March Sugar posted a daily buy signal at 10.70.
Last week's high was 10.79.
Last week's low was 10.62.
Last month's high was 10.61.
Last month's low was 9.74.
WHAT SHOULD TRADERS DO NEXT WEEK?
Aggressive traders who either added to their existing long position or established long positions for the last several weeks in October Sugar are advised to move all stops below 9.99. (Traders and their account executives need to discuss this suggested stop).
Options traders who purchased either March 1100 calls or March 1200 calls are advised to continue risking 100% of purchase price. (The options purchased were designed for the long-term trader).
 
1) If October Sugar first posts a lower low than last week’s low of 10.04 yet reverses, traders are to place resting buy stop ‘spread’ orders at 10.36 to roll their longs from the October contract to the March contract.
Resting spread orders would be written by indicating in equal contracts to buy the March Sugar and sell the October Sugar at the market price. This spread will liquidate trader’s established long October Sugar positions and leave traders with long March Sugar positions.
If this spread were to be activated, traders are advised to place stops for the March contract below 9.74, which was last month’s low.
2) If October Sugar activates ‘trading module #1,’ traders will be long March Sugar with stops placed below 9.74.  If March Sugar posts a weekly close above 10.79, aggressive traders are advised to either add to their existing long March position or establish a long March position, placing a stop for this position only below 10.60.
Our first objective will be a challenge of 10.88.
Our next objective will be the first unfilled price gap between 11.72 and 11.80.
3) If October Sugar first posts a higher high than last week’s high of 10.34, traders are advised to remain long their established positions, placing all stops at 10.03.
If this stop at 10.03 were to be activated, traders will be flat the October Sugar and will have to wait for a March trade signal before re-entering the market. 
4) If October Sugar first posts a higher high than last week’s high of 10.34 and a higher high than last month’s high of 10.35 yet does not reverse, traders are to remain long the October Sugar. Traders will remain long October Sugar until another opportunity arises to roll to the March contract.
WHAT EXIT STRATEGY SHOULD FUTURES AND OPTION TRADERS HAVE?
I will begin developing an exit strategy for futures traders and especially options traders who have purchased March 110 and 120 calls over the last fifteen-weeks. We need to not only be prepared for a possible downward price correction but a major price advance or blow off top.
Why should futures traders and March options traders have an exit strategy when they have over four-months until expiration?
The projection from the first ’W’ formation on the daily, weekly and monthly charts indicate our first main objective will be 13.29.
How did I arrive at this projection?
The low for the ’W’ was 4.97 (6/30/02).
The middle of the ’W’ is at 9.13 (2/28/03).
Let’s subtract the middle of the ‘W’ of 9.13 from the low of the ‘W’ at 4.97.
9.13 - 4.97 = 4.16-cents
Let’s add 4.16-cents to the middle of the ‘W’ of 9.13-cents.
9.13 + 4.16 = 13.29-cents.
If March Sugar were to trade to 13.29-cents before expiration, futures and options traders are advised to liquidate all positions and wait for a price pullback before re-entering.
If Sugar were to fill the first unfilled price gap between 11.72 and 11.80, acceleration in prices should be explosive. 
I did some research and found that the average of the 2-year, 1-year, and 6-month volatility for Sugar would possibly reach 33.87%. This would be almost 100% of the average volatility. An example of 100% range in volatility is lumber. Notice how lumber prices have fallen since Hurricane Katrina. Doesn’t make sense, does it? Everyone on the news is talking about rebuilding New Orleans. Either they’re not telling the truth, or rebuilding is far off in the distance. Lumber price volatility will need to come down before prices will move up. This could take a while to get longs out of the market.
This scenario may occur in Sugar as well - so let’s prepare.
Generally, Sugar over the years has reached a peak in prices between October 15th and November 15th.
1) If Sugar prices do reach approx. 13.29-cents, futures traders are advised to either exit all their long positions or 50% of their positions.
If traders opt to liquidate 50% of their positions on the outside chance of further price advances, traders are to tighten their stops dramatically.
2) If Sugar prices do reach approx. 13.29-cents, options traders are advised to either exit all their long positions or 50% of their positions.
If traders opt to liquidate 50% of their options positions on the outside chance of further price advances, traders are to place tight futures stops to protect their call positions.
3) If Sugar prices advance to 13.29-cents yet reverses, traders are to prepare for a major price pullback to between 10.50 and 10.90. This pullback could take three-weeks or three-months.
If this were to occur, futures traders will be advised to purchase July contracts, placing stops below 9.99.
Options traders will be advised to purchase July 120 Sugar calls between 22 and 26.
I will avoid the October 2006 contract because the harvest season is between September and December of each year.
If all goes well in the next eight-months, we will begin to watch March of 2007.
What I don’t want to happen is for Sugar to explode in price to 13.29 in a blow off rally… and then prices drop dramatically to 10.90. If this were to occur, all March 110 and 120 calls would expire worthless. So we always want to stay four to seven-months ahead of the market in options. 
4) If Sugar prices first pull back, there aren’t many options here so traders should sit tight. Futures traders were advised where to place their stops earlier in this piece.
On the flipside…
If October Sugar first posted a higher high than last month’s high of 10.35 yet reverses, posting a monthly close below 9.50, traders are to prepare for an assault on the 100-day moving average of 9.27 and possibly an attack on the 200-day moving average at 9.14.
If long futures traders are stopped out of the market, they are advised to sit and wait for the next progression of buy signals before re-entering the Sugar market.
Normally, I would suggest the short or long side of any market when it reverses and posts signals.  However, I’m reluctant to establish any short positions in Sugar because of the bullish ‘W’ formations on the daily, weekly and monthly charts.
If Sugar posted a close below 9.45, traders are to prepare for an assault on the original breakout at 9.30.
Each week I will continue to post Sugar’s past unfilled price gaps above the current market price so we can reference them quickly if the need presents itself.
1) Price gap between 11.72 and 11.80 (1/09/98).
2) Price gap between 13.50 and 13.61 (2/19/82).
3) Price gap between 19.80 and 19.85 (4/03/81).
4) Price gap between 25.85 and 26.20 (2/13/81).
5) Price gap between 31.25 and 31.30 (1/09/81).
6) Price gap between 33.85 and 35.05 (11/28/80).
7) Price gap between 51.20 and 53.20 (11/29/74).
8) Price gap between 59.20 and 61.10 (11/22/74).
For many weeks I’ve described some Sugar option facts and will continue to provide updated information:
Two-weeks ago Sugar options for a two-year ‘implied volatility’ average were ranked number 25 out of 45 - this week 13 out of 45 .
13) Sugar (SB) High 42.12% - Low 18.90% - Current 26.21%
Two-weeks ago Sugar options for a one-year ‘implied volatility’ average were ranked number 19 out of 45 - this week 7 out of 45
7) Sugar (SB) High 33.54% - Low 18.90% - Current 26.21%
Two-weeks ago Sugar options for a six-month ‘implied volatility’ average were ranked number 13 out of 45 - this week 5 out of 45 .
5) Sugar (SB) High 27.18% - Low 18.90% - 26.21%
Options are moving towards the expensive side.
DAILY CHART OCTOBER SUGAR:
http://bohl.minot.com/d_Chart.cgi?SB05V
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DAILY CHART MARCH SUGAR:
http://bohl.minot.com/d_Chart.cgi?SB05H
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WEEKLY CHART:
http://bohl.minot.com/w_Chart.cgi?SB
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DECEMBER NASDAQ 100 (ND5Z)
Last week I didn’t write ‘tech talk’ because of the extended holiday weekend. However, traders who receive the weekly trade recommendations via email each Saturday were informed of a weekly recommendation for the September NASDAQ contract. 
The weekly recommendation last week for the September contract: buy when trades 1591.00 - sell when trades 1554.50.
On Thursday of last week the NASDAQ rolled from September to the December contract.
Today I will develop a 'trading module' based on the December NASDAQ 100.
The December NASDAQ has been in a thirteen-week price advance that began from lows of 1432.50 (4/28/05) to highs of 1646.50 (8/03/05).
Recently the NASDAQ had been in a downward price decline that began from highs of 1646.50 to recent lows of 1568.00.
Currently the NASDAQ has been in a two-week price advance that began from lows of 158.00 to Friday’s high of 1625.00.
The NASDAQ has one unfilled price gap above the current market price. The most recent unfilled price gap is between 1630.50 and 1636.50.
The NASDAQ has several unfilled price gaps below the current market price. The most recent gap is between 1555.50 and 1568.00. The second unfilled price gap below the current market price is between 1522.00 and 1542.00.
Last week’s high was 1625.00.
Last week’s low was 1593.50.
Last month’s high was 1646.50.
Last month’s low was 1568.00.
WHAT DO THE CHARTS LOOK LIKE?
The 40-day moving average is currently at 1609.00 and the 50-day moving average is at 1596.50.
The 100-day moving average is currently at 1558.00 and the 200-day moving average is at 1533.00.
On 8/29/05, the NASDAQ posted an intra-day buy signal at 1580.50.
On 8/31/05, the NASDAQ posted a daily buy signal at 1584.00.
On 8/31/05, the NASDAQ posted an intra-weekly buy signal at 1601.50.
The daily chart shows the NASDAQ in an upward channel that was penetrated on the downside on 8/29/05. However, the NASDAQ has recovered and appears to have regained its upward momentum still in the channel.
The NASDAQ is potentially developing a monthly recommendation for October if prices stabilize and trade in an extended trading range for the next three-weeks.
The NASDAQ may be forming a bullish 'V' bottom if it can maintain a foothold above its 45 degree trendline at 1601.50, which was the intra-weekly buy signal.
WHAT WERE TRADERS ADVISED TO DO LAST WEEK?
Aggressive traders were advised to establish a long position in the NASDAQ 100 at the intra-weekly buy signal at 1601.50, placing stops below 1568.00.
Conservative traders were not able to establish a long position in the Mini NASDAQ because an intra-weekly buy signal was not posted in the December contract.
The first challenge will be to fill the previously unfilled gap between 1630.50 and 1636.50.
The second objective will be a challenge of contract highs at 1646.50.
Our long-term objective will be 1668.50.  
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Aggressive traders who established a long position in the NASDAQ 100 at the intra-weekly buy signal at 1601.50 are advised to leave their stops below 1568.00 for now.
1) If the NASDAQ first posts a higher high than last week’s high of 1625.00, aggressive traders are advised to either add to their existing long position or establish a long position, placing stops for this position only at 1592.00.
Conservative traders are advised to use the Mini NASDAQ as a trading vehicle.
The first challenge will be to fill the previously unfilled gap between 1630.50 and 1636.50.
2) If the NASDAQ posts a close above the gap at 1636.50, traders are to prepare for a challenge of contract highs at 1646.50.
3) If the NASDAQ posts a weekly close above 1648.50, aggressive traders are advised to either add to their existing long position or establish a long position, placing all stops below 1625.00.
Conservative traders are advised to use the Mini NASDAQ as a trading vehicle.
4) If the NASDAQ first posts a lower low than last week’s low of 1593.50 yet reverses, traders are advised to place resting stop entry orders at 1625.50 to either add to their existing long position or establish a long position.
If the resting stop entry order was activated, traders are advised to move all stops below 1592.00.
Our long-term objective will be 1668.50.  
On the flipside…
If the NASDAQ first posts a lower low than last week’s low of 1593.50 yet does not reverse, traders are advised to sit on the sidelines and wait for another trading opportunity.
DAILY CHART:
http://bohl.minot.com/d_Chart.cgi?ND05Z
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WEEKLY CHART:
http://bohl.minot.com/w_Chart.cgi?ND
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NOVEMBER SOYBEANS (S5X)
In my July 31st newsletter I began developing a ‘trading module’ for November Soybeans.
November Soybeans had been in an eighteen-week price advance from lows of 519.50 (2/09/05) to highs of 770.00 (6/22/05).
Soybeans had been in a volatile trading range between 751.00 highs and 666.00 lows.
Note: This product is extremely volatile and should only be traded by aggressive traders. This is not for the inexperienced trader or the faint of heart.
Clients were cautioned that they must have an equity to risk ratio of no more than 9% to trade this product.
At the inception of this ‘trading module,’ that meant if the risk in Beans was $4,275 - you must have an account size of $39,000 per contract.
If you did not fit this profile, I suggested that traders consult their account executive and consider an options strategy.
Does this mean traders shouldn’t establish a short position or add to their short positions?
No, but traders need to be cautioned that they must have an equity to risk ratio of no more than 9% to trade this product.
Soybean’s 100-day moving average is at 662.00 and 200-day moving average is at 619.00.
Soybeans have two unfilled price gaps below the current market price. The most recent gap is between 547.00 and 551.50.
Soybeans have two unfilled price gaps above the current market price. The most recent is between 640.00 and 644.25
On 8/05/05, Beans posted a weekly sell signal at 669.75.
On 8/05/05, Beans a monthly sell signal at 665.75.
On 8/09/05, Soybeans confirmed a breakout on the downside by closing below 660.50.
On 8/12/05, Beans posted an ‘intra-day’ sell signal at 649.00.
On 8/19/05, Beans posted a daily sell signal at 619.25.
On 9/08/05, Beans posted a daily sell signal at 601.25.
On 9/09/05, Beans posted an intra-daily sell signal at 599.25.
 
Last week’s high was 618.00.
Last week’s low was 589.00.
Last month’s high was 709.00.
Last month’s low was 595.50.
WHAT WERE TRADERS ADVISED TO DO LAST WEEK?
Aggressive traders who established a short position at the weekly sell signal of 669.75 were advised to move their stops above 630.00.
Aggressive traders who either added to their existing short position or established a short position at the unconfirmed monthly sell signal of 665.75 were advised to move their stops above 630.00.
Aggressive traders who either added to their existing short position or established a short position at the second posting of the unconfirmed monthly sell signal of 665.75 were advised to move their stops above 630.00.
Conservative traders who purchased November 620 puts were advised to risk 30% of current market value.
Aggressive traders who either added to their existing short position or established a short position at 595.25 were advised to move their stops for this position only above 622.25.
Our next objective was 581.00.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
On Monday the all-important USDA Crop Production, Supply and Demand reports will be released at 7:30 a.m., CT.
Pre-report trade expectations of the USDA's S&D Report.
2004/05 carryover
Soybeans:
Avg. 0.295
Range 0.287-0.310
USDA August 0.300
USDA 2003/04 0.112
2005/06 carryover
Soybeans:
Avg. 0.191
Range 0.163-0.234
USDA August 1.900
Crop Production Expectations
Soybeans:
Avg. 2.811
Range 2.766-2.895
USDA August 2.791
USDA 2004 3.141
Aggressive traders who established a short position at the weekly sell signal of 669.75 are advised to leave their stops above 630.00 for now.
Aggressive traders who either added to their existing short position or established a short position at the monthly sell signal of 665.75 are advised to leave their stops above 630.00 for now.
Aggressive traders who either added to their existing short position or established a short position at the second posting of the monthly sell signal of 665.75 are advised to leave their stops above 630.00 for now.
Conservative traders who purchased November 620 puts are advised to risk 20% of current market value.
Aggressive traders who either added to their existing short position or established a short position at 595.25 are advised to move their stops for this position only above 618.00.
1) If Beans first post a lower low than last week’s low of 589.00, aggressive traders are advised to either add to their existing short position or establish a short position, placing all stops at 618.25.
2) If Soybeans post a close at or below 581.00, traders are to prepare for an all out assault on the unfilled price gap between 547.00 and 551.50.
If this were to occur, traders are advised to move all stops above 595.50.
3) If Beans fill the price gap between 547.00 and 551.00, aggressive traders are advised to move all stops above 581.00.
4) If Beans post a weekly close below 547.00, aggressive traders are advised to either add to their existing short position or establish a short position, placing all stops above 564.00.
Our next objective will be a challenge of contract lows at 519.50.
Note: All Soybean traders are advised to exit their short positions by September 28th because of a seasonal tendency to trade higher. 
If traders exit their Soybeans by September 28th, sit on the sidelines and wait for another trading opportunity.
On the flipside…
1) If Beans first post a higher weekly high than last week’s high of 618.00 yet reverse, aggressive traders are advised to place resting sell stop orders at 588.75.
If the resting sell stop orders at 588.75 are activated, aggressive traders are advised to move all resting stops to 618.25.
2) If Beans first post a lower low than last week’s low of 589.00 yet reverse - triggering all stops at 618.25, traders are advised to sit on the sidelines and wait for another trading opportunity.
3) If Beans were to post a weekly close above 665.75, traders are to prepare for an assault on the possible monthly buy signal at 709.25.
4) If Beans were to post a monthly close for September at or above 709.00, aggressive traders are advised to establish a long position, placing stops below 665.75.
DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?S05X
------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?S
----------------------------------------------------
NOVEMBER NATURAL GAS (NG5X)
This week I will develop a 'trading module' for November Natural Gas for two reasons. The first reason is Natural Gas has a weekly recommendation for next week. The second is a tale of woe that will likely be visiting many residents who live in large condominium buildings in cities - like Chicago - that experience arctic-like winters.
I recently accompanied a friend to a condo board meeting. The building is home to well over a thousand residents - and is really akin to a ‘vertical’ small town. As I’m sure you know, condos are owned by individuals and larger buildings usually have a Board of Directors comprised of residents who have volunteered their time and talents. The Board is elected by their fellow resident owners - sometimes by popularity - but more often by ‘default’ due to lack of interest.  
All of the board members appear to be successful in their businesses and well versed in their particular areas of expertise. Periodically, the Board meets to vote on simple matters, like how much to spend on a couch for the lobby. Yet at some meetings, they are actually required to make very important decisions. That directly impacts the lives of every owner.
Last April, the Board convened to make one of these very important decisions: The building is heated with Natural Gas. Should they lock up a price for Natural Gas for the coming winter? They apparently had a lively debate amongst themselves - and eventually invited the handful of residents who bothered to attend to offer their opinions.  A vote was taken - and two astute Board members felt it would be prudent to lock in prices - especially since they have usually done so in the past. However, the remaining members felt sure that Natural Gas prices were way too high and they would almost certainly come down. Before the meeting, they had polled similar buildings in the area and found that many of their Boards shared their belief that prices would come down.
It appears that this winter, many high rises in metropolitan cities will be competing with homeowners, retail businesses, agricultural conglomerates and farmers for their share of Natural Gas. 
Last Friday I called my Culver Military buddies in Texas and Oklahoma to inquire about their Natural Gas fields. They said there was a positive supply of Natural Gas through their area, which services the west. However, once the driving season ends and the refineries switch to Heating Oil, the Midwest and East Coast could drain their Natural Gas reserves to a negative supply.     
Associated Press - 09/11/2005
WASHINGTON -- Natural gas prices could increase as much as 71 percent in part of the United States this fall, the Energy Department reports.
Note: This product is extremely volatile and should only be traded by aggressive traders. This is not for the inexperienced trader or the faint of heart.
Clients are being cautioned that they must have an equity to risk ratio of no more than 9% to trade this product.
Natural Gas has a weekly recommendation that has a trading risk of $6,800, which means you must have an account size of $66,000 per contract.
If you do not fit this profile, I suggested that traders consult their account executive and consider an options strategy.
November Natural Gas has four unfilled price gaps below the current market price. The most recent price gap is between 10.450 and 11.000.
November Natural Gas has no unfilled price gaps above the current market price.
The 40-day moving average is at 9.797 and the 50-day moving average is at 9.488.
The 100-day moving average is at 8.530 and the 200-day moving average is at 7.841.
Last week’s high was 12.070.
Last week’s low was 11.410.
Last month’s high was 12.350.
Last month’s low was 8.570.
WHAT SHOULD TRADERS DO NEXT WEEK?
Natural gas has a weekly recommendation for next week: buy when trades 12.080 - sell when trades 11.400.
1) If Natural Gas first posts a weekly buy signal at 12.080, aggressive traders are advised to establish a long position, placing stops at 11.400.
Aggressive options traders are advised to purchase January 13.000 calls, risking 60% of purchased value.
2) If Gas posts a higher high than last month’s high of 12.350, aggressive traders are advised to either add to their existing long position or establish a long position, placing stops at 11.400.
Aggressive options traders are advised to purchase January 13.000 calls, risking 60% of purchased value.
Our short-term objective will be 12.730.
Our intermediate objective will be 13.290.
Our long-term objective will be 24.690.
On the flipside…
1) If Natural Gas first posts a weekly sell signal at 11.400, aggressive traders are advised to not establish a short position but should place resting buy stop orders at 12.080 to establish a long position.
If the resting buy stop orders were activated, traders are advised to place a stop at 11.400.
2) If Natural Gas first posts a weekly sell signal at 11.400 yet does not reverse, traders are advised to establish a long position as close to the most recent unfilled gap between 10.450 and 11.000.
If traders do establish a long position between 10.700 and 11.100, place all stops below 9.870.
Aggressive options traders are advised to purchase January 12.000 calls, risking 60% of purchased value.
DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?NG05X
------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?NG
----------------------------------------------------
DECEMBER TEN-YEAR NOTE (TY5Z)
This week I will develop a ‘trading module’ for December Ten-year notes because of a ‘coil’ daily recommendation for Monday and a weekly recommendation for next week.
The December Ten-Year Note has been in a four-week up trend from lows of 109-015 to highs of 112-200.
Recently, Notes have traded from highs of 112-200 to lows of 111-095.
On 8/12/05, Notes posted an intra-weekly buy signal at 110-065.
On 8/16/05, Notes posted a daily buy signal at 110-150.
On 8/18/05, Notes posted a daily buy signal at 110-215.
On 8/30/05, Notes posted a daily buy signal at 111-060.
Notes have several unfilled price gaps below the current market price. The most recent is between 109-300 and 109-310.
Notes have one unfilled price gap above the current market price between 112-255 and 112-300.
Notes appear to have posted a bullish ‘V’ bottom from lows of 109-015. However, Notes must maintain a foothold above 110-260, which is the 45 degree angle of the ’V’.
Notes 40-day moving average is at 110-230 and the 50-day moving average is at 110-270.
Notes 100-day moving average is at 111-075 and the 200-day moving average is at 110-135.
Last month’s high was 112-075.
Last month’s low was 109-015.
WHAT SHOULD TRADERS DO NEXT WEEK?
For Monday the December Ten Year has a daily recommendation: buy when trades 111-255- sell when trades 111-145.
Monday’s recommendation is not only a daily recommendation but a ’coil’ day. A coil day is different from a normal daily recommendation in that when it posts its signal, it lashes violently in that direction. Last Thursday, Gold had a ’coil’ day and once it posted its buy signal at 450.30, away it went to 453.90.
Generally, the direction of the ‘coil’ day signal will set the tone for the overall direction for many days.  
For next week, the December Ten Year has a weekly recommendation: buy when trades 112-065 - sell when trades 111-090.
1) If Notes first post a daily buy signal at 111-255, traders are advised to establish a long position, placing stops at 111-090.
2) If Notes post a weekly buy signal at 112-065, traders are advised to either add to their existing long position or establish a long position, placing stops at 111-090.
3) If Notes post a close above 112-200, traders are advised to either add to their existing long position or establish a long position, placing all stops below 112-065.
Our first objective will be the unfilled price gap between 112-255 and 112-300. 
On the flipside…
1) If Notes first post a daily sell signal at 111-090, traders are advised to establish a short position, placing stops at 112-065.
2) If Notes post a weekly sell signal at 111-090, traders are advised to either add to their existing short position or establish a short position, placing stops at 112-065.
3) If Notes post a close above 112-200, traders are advised to either add to their existing long position or establish a long position, placing all stops above 112-065.
4) If Notes post a weekly close below the ‘V’ trendline at 110-260, traders are advised to either add to their existing short position or establish a short position, placing all stops above 111-090.
Our first objective will be the unfilled price gap between 109-300 and 109-310.
DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?TY05Z
------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?TY 

CHART WATCH by Scott R. Joss (Non member C.T.A)*

Readers and clients call during the week and ask: What are you watching?

Watching can mean that the markets are developing a 'recommendation' or a chart pattern that has not yet fully developed - or may never develop.

During the course of the week or month it is not uncommon to find an `intra-day, intra-week or intra-month' recommendation that was previously not revealed when this newsletter was written.

Products that currently fit into this 'watch' category are listed below and should be 'watched.'

DECEMBER COTTON (CT5Z)
December Cotton will be added to ’Chart Watch’ this week because of a possible monthly recommendation for October.
Cotton has been in an eight-week price decline that began from highs of 57.20 (7/05/05) to recent lows of 47.76 (8/19/05).
Cotton has recently posted lows of 47.80 on 8/15/05 and 47.76 on 8/19/05.
Several weeks ago I posed the question: Will Cotton try to use these lows as a stopping point and post a mini ‘spread double’ bottom?
On 8/04/05, Cotton posted a daily sell signal at 52.19.
On 8/10/05, Cotton posted a close below the ‘M’ or middle of the ‘double reversal’ at 51.09.
On 8/24/05, Cotton posted an ‘intra-day’ sell signal at 48.64.
On 8/29/05, Cotton posted a daily buy signal at 48.51.
On 9/09/05, Cotton posted a daily sell signal at 51.64.
Cotton’s 40-day moving average is at 50.46.
Cotton’s 50-day moving average is at 51.29.
Cotton’s 100-day moving average is at 52.63.
Cotton’s 200-day moving average is at 52.28.
Last week’s high was 52.90.
Last week’s low was 49.90.
Last month’s high was 53.30.
Last month’s low was 47.76.
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Monday is an important day for Cotton because the USDA will release Crop Production and Supply and Demand numbers. Also, Cotton Ginnings are reported.
Pre-report trade expectations of USDA's S&D Report.
USDA will release the report on Monday, Sept. 12, at 7:30 a.m., CT.
2005/06 carryover
Cotton:
Avg. 8.02
Range 6.5-7.4
USDA August 7.0
Crop Production Expectations
Cotton:
Avg. 21.32
Range 20.9-22.0
USDA August 21.29
USDA 2004 23.25
1) Traders are to sit on the sidelines and wait to see if a monthly recommendation develops for October.
2) If Cotton posts a monthly recommendation for October, traders will have a defined risk and direction.
3) If Cotton does not post a monthly recommendation, then traders will have to rely on a weekly or daily recommendations to enter this market.
DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?CT05Z
------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?CT
----------------------------------------------------
DECEMBER COPPER (HG5Z)
December Copper will be added to ‘Chart Watch’ this week because of a possible intra-monthly sell signal.
Traders for several months have asked me to update them on Copper.
If December Copper were to close at or below 156.00 by the close of business September 30th, this would constitute a major trend reversal.
I will update traders next week on the progress of a potential 'intra-monthly' sell signal.
DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?HG05Z
------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?HG

CURRENT 'MONTHLY' RECOMMENDATIONS
FOR SEPTEMBER:

- DOW JONES

FUTURE WATCH

Future watch will list developing 'monthly' recommendations to watch in September for October. By listing these products, traders can `feed-forward' with anticipation and focus - centering on products that will provide direction and hopefully, opportunity.
Traders should begin studying the 'daily', 'weekly' and 'monthly' charts for the products listed below. Don't forget between now and the end of the month, some or all of these products may be de-listed.
'Monthly' recommendations will be revealed on the close of business September 30 and sent via email for October.

- NATURAL GAS
- CORN
- WHEAT
- SOYBEAN MEAL
- SOYBEAN OIL
- LEAN HOGS
- S&P 500
- EMINI S&P
- NASDAQ 100
- MINI NASDAQ
- DOW JONES
- SILVER
- CRUDE OIL
- COTTON
- ORANGE JUICE
- LIVE CATTLE

COPYRIGHT WARNING AND NOTICE: It
is a violation of federal copyright law to
reproduce all or any part of this publication or
its contents by email, facsimile, xerography,
scanning or any other means, without
permission.
Copyright 2005, Joss Report - S.R. Joss Inc and ClearTrade Inc. All rights reserved.
If you are receiving this report from any other source than S.R. Joss Inc or ClearTrade Inc. please contact us at 1-800- 493-4444.

NOTE:

If you do not completely understand this information, you are advised to take NO action until speaking with your Account Executive.

ClearTrade, Inc. may be reached at 800-493-4444

====================================

* The Joss Report Trade Recommendations and Weekly Trade Advisor Newsletter is prepared by Scott Joss, Non- Member C.T.A.

Scott Joss is a 'non member' CTA and is providing the Joss Report weekly trading advisor newsletter and trade recommendations to ClearTrade, Inc. clients. Scott Joss 'is a principal' of ClearTrade, Inc. and 'is a registered IB member' with the NFA.

====================================

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(800) 493-4444
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Mailto:research@cleartrade.com 
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====================================

DISCLAIMER:

* COMING EVENTS AND DATA RELEASES:

Calendar provided by Briefing.com, Inc. Data is provided for informational purposes only, and is not intended for trading purposes. Neither ClearTrade, Inc. nor any of its data or content providers (such as Reuters, CSI, and Briefing.com) shall be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Market recommendations are strictly the opinion of the writer and are intended solely for informative purposes and are not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Futures trading involve substantial risk. In no event should the content of a market letter be construed as a promise that you will profit or that losses can or will be limited in any manner whatsoever.

Unless otherwise indicated, the links presented in this publication/newsletter are in no way affiliated with ClearTrade, Inc. Likewise, sites linked through ClearTrade's Joss Report weekly trade advisor newsletter are not necessarily connected with ClearTrade, nor do any such links imply an endorsement by either party.

ClearTrade, Inc. does not necessarily promote or endorse the services or publications described herein. Unless otherwise indicated, ClearTrade Inc. has had no role in the production or review of these products or services and makes no warranty, either expressed or implied, as to their contents, accuracy or performance.

Past results are no indication of future performance. Information provided in this newsletter is intended solely for informative purposes and is obtained from sources believed to be reliable. Information is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted.

REPRODUCTION OR REBROADCAST OF ANY PORTION OF THIS INFORMATION IS STRICTLY PROHIBITED WITHOUT THE WRITTEN PERMISSION OF S.R. JOSS INC./CLEARTRADE, INC.

The contents of this newsletter are copyright 1997-2005, Scott R. Joss/S.R. Joss Inc./ClearTrade, Inc. *TM. All Rights Reserved.

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