WELCOME TO THE JOSS REPORT - WEEKLY TRADE ADVISOR

ClearTrade®
 Clearing Man Financial
The Joss Report trading recommendations and weekly trade advisor 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 Archived Weekly Trade Advisor 2006

 

· TECH TALK - EURO - CRUDE - COTTON - DOW - SILVER
· CHART WATCH - GOLD - SOYBEAN MEAL - ORANGE JUICE
· CURRENT 'MONTHLY' RECOMMENDATIONS 
· FUTURES WATCH
· COMING EVENTS AND DATA RELEASES  

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

MARCH CRUDE OIL (CL6H)
Several weeks ago I began developing 'trading modules' for March Crude Oil because of an ‘intra-week’ buy signal at 59.91.
March Crude Oil had been in an eight-week price decline that began from highs of 70.70 (9/01/05) to lows of 57.50 (11/30/05).
Recently, March Crude Oil has been in a four-week price advance from lows of 57.95 to highs of 68.90 (1/20/06).
Last week, March Crude Oil posted a bullish ‘downward flag’ formation from highs of 68.80 to lows of 65.45.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated that the net change in open interest last week decreased by -1,331, posting a total open interest of 908,242 contracts. 
WHAT DOES THE MARCH CRUDE OIL CHART LOOK LIKE?
March Crude Oil has been in a multi-year price advance which began from lows of 24.27 (9/02/03) to recent highs of 70.70 (9/01/05).
March Crude Oil began its current price advance from lows posted on 11/18/05 and 11/30/05 at 57.50 to recent highs of 69.15 (1/20/06).
March Crude Oil has posted a bullish spread 'double bottom' at 57.50.
Confirmation of the spread 'double bottom' was multiple closes above 63.45.
March Crude Oil also developed a bullish 'W' formation.
The left side of the 'W' formation developed between highs of 63.75 to lows of 57.50.
The middle of the 'W' formed between lows of 57.50 and highs of 63.45.
The right side of the 'W' formation began from lows of 57.95 and posted a close above the middle of the 'W' (63.45) on 1/03/06.
This bullish 'W' formation indicates that our objective would be 69.40.
March Crude Oil has one unfilled price gap above the current market price between 69.00 and 69.14.  
March Crude Oil has several unfilled price gaps below the current market price. The most recent unfilled price gap is between 66.90 and 66.95. The second unfilled price gap is between 64.75 and 65.75. The third unfilled price gap below the current market price is between 62.00 and 62.50.
March Crude has closed above its 40-day moving average of 62.86 and above its 50-day moving average - which as of Friday was at 62.04.
March Crude Oil closed Friday at 67.76, which is above its 100-day moving average of 63.06 and its 200-day moving average of 61.20.
Listed below are the original trade signals that March Crude Oil has recently posted:
On 11/18/05 and 11/30/05, March Crude posted a potential spread 'double bottom' at 57.50.
On 12/28/05, March Crude posted an 'intra-week' buy signal at 59.91.
On 1/03/06, March Crude posted a monthly buy signal at 63.46.
On 1/03/05, March Crude posted a close above the middle of the potential 'W' formation at 63.45.
On 1/20/06, March Crude posted a daily buy signal at 67.31.
On 1/24/06, March Crude posted a daily sell signal at 67.69.
Crude Oil, due to extreme volatility, is not for the inexperienced trader.
Traders are not to exceed the rule of thumb - 10% of equity to risk ratio.
If you do not fit this risk profile, traders are advised to consult their account executive for an option trading strategy or are advised to use the Mini Crude Oil contract as their trading vehicle.
WHAT WERE TRADERS ADVISED TO DO LAST WEEK?
http://www.cleartrade.com/images/letter_1_22_06
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Aggressive traders who established long positions at the 'intra-week' buy signal at 59.91 are advised to move their stops below 65.25*.
Aggressive traders who either added to their existing long positions or established a long position at the monthly buy signal of 63.46 are advised to move stops for this position below 65.25*.
Below are possible ‘trading modules’ for futures traders to consider next week:
# 1) If March Crude Oil first posts a higher high than last week's high of 68.65:
Aggressive traders are advised to wait for multiple closes (4 business days) above 68.80 before either adding to their established long position or establishing a long position.
If March Crude posts multiple closes above 68.80, traders are advised to place all stops below 65.45*.
Our first objective will be 69.14.
Our second objective will be an all out assault on contract highs of 70.70.
# 2) If March Crude Oil posts multiple closes above 70.70:
Aggressive traders are advised to either add to their established long position or establish a long position, placing stops for all positions below 69.14*.
Our third objective will be 72.15.
Our long-term objective will be 83.90.
#3) If March Crude first posts a lower low than last week's low of 65.45:
Aggressive traders are advised to leave their stops in place as recommended above.
# 4) If March Crude fills the unfilled price gap below the current market price between 64.75 and 65.75:
Aggressive traders are advised to prepare for a possible price decline that may retest the middle of the ‘W’ formation at 63.45.
Below are possible ‘reversal trading modules’ to consider next week:
# 5) If March Crude first posts a higher high than last week's high of 68.65 yet reverses, posting a lower low than last week’s low of 65.45:
Aggressive futures traders are advised to liquidate their existing long positions.
# 6) If March Crude first posts a lower low than last week's low of 65.45 - not filling the gap at 64.75, yet reverses, posting a higher high than last week's high of 68.65:
Aggressive traders are advised to place resting buy stop orders at 68.66.
If the resting buy stop order at 68.66 is activated, aggressive traders are advised to add to their existing long positions, establish a long position, or reestablish their long positions.
If March Crude posted 68.66, aggressive traders are advised to place all stops below 66.90*.
Below are possible ‘monthly reversal trading modules’ to consider:
# 7) If March Crude posts a monthly close at or below 57.95:
Aggressive traders are advised to have liquidated their long positions and are advised to establish a short position, placing stops above 60.46*.
Our first objective will be an all out assault on contract lows at 57.50.
I have compiled some Crude Oil option facts for traders:
Crude options for a two-year ‘implied volatility’ average are ranked number 33 out of 45.
33) Crude (CL) High 44.71% - Low 27.07% - Current 29.26%.
Crude options for a one-year ‘implied volatility’ average are ranked number 43 out of 45.
43) Crude (CL) High 40.11% - Low 28.79% - Current 29.26%.
Crude options for a six-month ‘implied volatility’ average are ranked number 42 out of 45.
42) Crude (CL) High 40.11% - Low 28.79% - Current 29.26%.
DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?CL06H
-----------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?CL
* (Futures traders and their account executives are advised to discuss this suggested stop).

** (Option traders and their account executives are advised to discuss the suggested risk). 
----------------------------------------------------
MARCH EURO-CURRENCY (FX) (EC6H)
Two weeks ago I began developing several 'trading modules' for the March Euro-Currency because of a monthly buy signal that was posted at 1.2123 on 1/04/06 and a weekly buy signal posted at 1.2205 on 1/17/05 (night trading).
The March Euro-Currency had been in a five-week price decline that began from highs of 1.2691 (9/02/05) to lows of 1.1719 (11/15/05).
Recently, the March Euro-Currency had been in a four-week price advance from lows of 1.1825 to highs posted at 1.2359 (1/25/06).
Currently, the March Euro-Currency has had a price decline from highs of 1.2359 to 1.2118.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated that the net change in open interest last week increased by 15,043, posting a total open interest of 144,606 contracts. 
WHAT DOES THE MARCH EURO-CURRENCY CHART LOOK LIKE?
Last week, the March Euro-Currency tried to push through the 200-day moving average at 1.2319. I advised traders in last week’s Weekly Trade Advisor to be cautious at the 1.2325 and 1.2595 levels. I also explained that the Euro-Currency may be forming a bearish ‘head and shoulders’ top on the weekly and monthly charts. Traders are advised to continue to monitor this potential formation.
The March Euro-Currency has multiple unfilled price gaps above the current market price. The most recent unfilled price gap is between 1.2477 and 1.2500. 
The March Euro-Currency has two unfilled price gaps below the current market price. The first unfilled price gap is between 1.1961 and 1.1962. The second unfilled price gap is between 1.1875 and 1.1876. 
The March Euro-Currency has closed above its 40-day moving average and 50-day moving average - which as of Friday was at was at 1.2032 and 1.1979, respectively.
The March Euro-Currency closed Friday at 1.2135 - which is above its 100-day moving average of 1.2073 yet below its 200-day moving average of 1.2302.
Listed below are the original trade signals that the March Euro-Currency has recently posted:
On 11/15/06 and 11/17/05, the March Euro-Currency posted a potential spread 'double bottom' at 1.1719 and 1.1720, respectively.
On 12/12/05, the March Euro-Currency posted a weekly buy signal at 1.1912.
On 12/30/05, the March Euro-Currency posted a weekly sell signal at 1.1853.
On 1/04/06, the March Euro-Currency posted a monthly buy signal at 1.2123.
On 1/06/06, the March Euro-Currency posted a daily buy signal at 1.2167.
On 1/17/06, the March Euro-Currency posted a weekly buy signal at 1.2205.
On 1/20/06, the March Euro-Currency posted an ‘intra-day’ buy signal at 1.2163.
On 1/25/06, the March Euro-Currency posted an ‘intra-day’ sell signal at 1.2290.
The March Euro-Currency, due to extreme volatility, is not for the inexperienced trader.
Traders are not to exceed the rule of thumb - 10% of equity to risk ratio.
If you do not fit this risk profile, traders are advised to consult their account executive for an option trading strategy.
WHAT WERE TRADERS ADVISED TO DO LAST WEEK?
http://www.cleartrade.com/images/letter_1_22_06
On 1/25/06, ClearTrade clients were advised to liquidate their established long positions due to an ‘intra-day’ sell signal posted at 1.2290 and the inability of the March Euro-Currency to post multiple closes above the 200-day moving average.
Non ClearTrade clients should be advised that as market conditions change, so do the trading modules developed each Sunday in the Joss Report.
Traders need to remember to always weigh the risk to reward ratio when trading. Tighten stops - or even exit positions when volatility is at extreme levels.
Traders are advised to sit on the sidelines and wait for another trading opportunity.
DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?EC06H
-----------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?EC
* (Futures traders and their account executives are advised to discuss this suggested stop).

** (Option traders and their account executives are advised to discuss the suggested risk).
----------------------------------------------------
MARCH DOW JONES (DJ6H)
Several weeks ago I began developing 'trading modules' for the March Dow Jones because of an 'intra-week' buy signal at 10986 and monthly buy signal that was posted at 11001.
In addition, I warned traders that the trade signals listed above looked perfect for a further price advance ... however, the charts indicated some negative 'feedback.'
The most negative indicator was that each trade signal posted since January 3rd were all 'intra-day', 'intra-week' and 'intra-month' buy signals. This indicated a counter-trend, which could be a bull trap. I advised traders to be careful and not fall asleep on this one. 
The March Dow Jones had been in a six-week price trading range between lows 10680 and highs of 11085.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated that the net change in open interest last week decreased by -1,042, posting a total open interest of 40,565 contracts. 
WHAT DOES THE MARCH DOW JONES CHART LOOK LIKE?
The March Dow Jones has been in a multi-year price advance, which began from lows of 7180 (10/11/02) to recent highs of 11085 (1/11/06).
The March Dow Jones began its current price advance from lows posted at 10257 (10/13/05) to recent highs of 11085.
The March Dow Jones had been in a six-week trading range between lows of 10680 and highs of 11085.
Until the Dow can post multiple closes above 11085 (4-days minimum) or multiple closes below 10680 (4-days minimum), the Dow Jones may be in a price consolidation coiling for an eventual explosive breakout.
The March Dow has two unfilled price gaps above the current market price. The first unfilled price gap is between 10958 and 10973. The second unfilled price gap is between 11066 and 11070.   
The March Dow has several unfilled price gaps below the current market price. The first unfilled price gap is between 10595 and 10600. The second unfilled price gap is between 10500 and 10531.  
The March Dow is above its 40-day moving average and 50-day moving average - which as of Friday was at 10893 and 10893, respectively.
The March Dow closed Friday at 10943 which is above its 100-day moving average of 10708 and above its 200-day moving average of 10669.
The March Dow's high in 2005 was at 11027 and this year's high is at 11085.
The March Dow’s low in 2005 was 10000 and this year’s low is 10680.
I advised traders to begin watching a potential development that may occur in the next eleven months. If the March Dow Jones - or subsequent months in the Dow Jones futures can post a close below 10000, this would constitute a possible yearly sell signal and would suggest a continuation pattern conducive to lower prices.
Listed below are the original trade signals that the March Dow has recently posted:
On 1/03/06, the March Dow posted an 'intra-day' buy signal at 10806.
On 1/06/06, the March Dow posted an 'intra- week' buy signal at 10986.
On 1/06/06, the March Dow posted an 'intra-month' buy signal at 11001.
On 1/20/06, the March Dow posted an ‘intra-month’ sell signal at 10730.
On 1/24/06, the March Dow posted a daily buy signal at 10762.
The March Dow, due to extreme volatility, is not for the inexperienced trader.
Traders are not to exceed the rule of thumb - 10% of equity to risk ratio.
If you do not fit this risk profile, traders are advised to use the Mini Dow Jones contract as their trading vehicle.
WHAT WERE TRADERS ADVISED TO DO LAST WEEK?
http://www.cleartrade.com/images/letter_1_22_06
Last week aggressive traders liquidated their short positions.
Until the Dow Jones can either post multiple closes below 10680 or multiple closes above 101185, traders are advised to sit on the sidelines and wait for another trading opportunity.
DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?DJ06H
-----------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?DJ
* (Futures traders and their account executives are advised to discuss this suggested stop).

** (Option traders and their account executives are advised to discuss the suggested risk).
----------------------------------------------------
MARCH SILVER (SI6H)
March Silver was placed in ‘Chart Watch’ last week because of a bullish ascending right triangle. This week March Silver moves to ‘Tech Talk’ because of a major breakout.
The ‘Commitment of Traders’ report for Silver - published each Friday by the CFTC -indicated the net change in open interest last week increased by 976, posting a total open interest of 131,701 contracts. 
Silver is not for the inexperienced trader or the faint of heart due to extreme volatility.
Traders are not to exceed the rule of thumb - 10% of equity to risk ratio.
If you do not fit this risk profile, traders are advised to consult their account executive for an option trading strategy.
WHAT DOES THE MARCH SILVER CHART LOOK LIKE?
March Silver has been in a multi-year price advance that began from lows of 4.050 (11/30/01) to recent highs of 9.750 (1/27/06).
Recently, March Silver had been in an eight-week trading range between lows of 8.285 and highs of 9.295.
Currently, March Silver is in a price advance from lows of 8.910 to highs of 9.750 (9.800 in night trading).
Last week I wrote that March Silver was in a price consolidation which would continue until March Silver posted a close below 8.285 or posted a close above 9.295.
On 1/24/06, March Silver posted a daily buy signal at 9.085.
On 1/25/06, March Silver posted a close above the all-important 9.295 (multiple closes above 9.295 are needed to confirm a breakout).
If March Silver were to post multiple closes above contract highs of 9.295, this would suggest a continuation pattern that is conducive to higher prices.
Our immediate objective would be 10.305.
March Silver closed above its 40-day moving average and 50-day moving average as of Friday which were at 8.910 and 8.770, respectively.
March Silver closed Friday at 9.605 which is above its 100-day moving average of 8.180 and its 200-day moving average of 7.720.
Last week The Joss Report described that March Silver was developing a bullish 'ascending’ right triangle.
The 'ascending’ right triangle’s upward trendline began from lows of 6.800 through lows of 7.500, 7.550, and if touched this week would intersect at 8.880.
The ‘ascending’ right triangle’s horizontal trendline touches highs of 9.280, 9.295, 9.270 and 9.275.
Major support is at 9.260.
March Silver has several unfilled price gaps above the current market Price. The most recent unfilled price gap is between 10.780 and 11.010.
March Silver has several unfilled price gaps below the current market price. The most recent unfilled price gap is between 9.260 and 9.355.
WHAT WERE TRADERS ADVISED TO DO LAST WEEK?
http://www.cleartrade.com/images/letter_1_22_06
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Below are possible ‘trading modules’ for futures and option traders to consider next week:
# 1) If the March Silver first posts a higher high than last week's high of 9.750:
Aggressive futures traders are advised to wait for multiple closes above the high for January, which will not be revealed until the close of business January 31st.
If March Silver posts multiple closes above January’s high, aggressive traders are advised to add to their existing long positions or establish a long position, placing all stops below 9.270*.
Option traders are advised to purchase March 950 calls, risking 70% of purchase price**.
Our first objective will be 9.850.
# 2) If the March Silver posts multiple closes above 9.880:
Aggressive futures traders are advised to either add to their existing long position or establish a long position, placing all stops below 9.270*.
Option traders are advised to purchase March 975 calls, risking 70% of purchased price**.
Our next objective will be a challenge of 10.170 (3/31/84).
# 3) If March Silver posts multiple closes above 10.170:
Aggressive futures traders are advised to either add to their existing long position or establish a long position, placing all stops below 9.295*.
Option traders are advised to purchase March 1000 calls, risking 70% of purchased price**. 
Our next objective will be 10.305.
# 4) If March Silver posts multiple closes above 10.500:
Aggressive futures traders are advised to add to their existing long position or establish a long position, placing all stops below 9.880*.
Option traders are advised to purchase 1050 calls risking 70% of purchased price**. 
Our next objective will be to fill the price gap at 10.720.
# 5) If March Silver first posts a price pullback:
If March Silver posts a price pullback towards support at 9.260, aggressive futures traders are advised to add to their existing long position or establish a long position, placing stops below 8.910*.
Options traders are advised to purchase April bull call spreads.
Buy the April 975 calls and sell the April 1075 calls, risking 70% of purchase price.
I have compiled some Silver option facts:
Silver options for a two-year ‘implied volatility’ average are ranked number 4 out of 45.
4) Silver (SI) High 40.09% - Low 19.14% - Current 34.73%.
Silver options for a one-year ‘implied volatility’ average are ranked number 3 out of 45.
3) Silver (SI) High 34.73% - Low 19.14% - Current 34.73%.
Silver options for a six-month ‘implied volatility’ average are ranked number 3 out of 45.
3) Silver (SI) High 34.73% - Low 19.14% - Current 34.73%.
DAILY CHART:
http://www.bohlish.com/d_Chart.cgi?SV06H
-----------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?SV
* (Futures traders and their account executives are advised to discuss this suggested stop).

** (Option traders and their account executives are advised to discuss the suggested risk).
----------------------------------------------------
MARCH COTTON (CT6H)
In The Joss Report’s newsletter 12/08/05 I began developing several 'trading modules' for March Cotton because of a weekly buy recommendation and a daily buy recommendation.
On 12/12/05, March Cotton posted a weekly buy signal at 53.26.
On 12/16/05, March Cotton posted an 'intra-day' buy signal at 53.36.
Since the beginning of December 2005 I've mentioned in my newsletters that the WTO would try to tackle cutting Cotton subsidies.
This article was posted today:
GENEVA, Jan 29 (Xinhua): Trade ministers ending a meeting in the Swiss resort of Davos said yesterday they were hopeful of breaking a deadlock over a global free trade accord to strike a deal by the end of the year.
They said agreement had been reached on a timetable for a deal on lowering barriers in major areas of the global economy, Swiss Radio International reported. "We have a precise timetable which will allow us to measure progress. There is also a strong commitment to push ahead and conclude the talks based on the meeting in Hong Kong in December," said Swiss Economics Minister Joseph Deiss, who hosted the informal ministerial meeting on the sidelines of the annual World Economic Forum conference.
The timetable was designed to set intermediate targets showing what and when negotiators should achieve in the detailed technical talks over the coming weeks and months, Deiss said.
Ministers from some 20 World Trade Organization (WTO) members, including the US, the EU, Japan, Brazil, India, etc., were present at the two-day gathering, which was the first ministerial meeting since a conference in Hong Kong last December.
The Hong Kong conference concluded with an agreement to remove all farm export subsidies by 2013, a swift end to cotton subsidies and the opening of rich country markets to more goods from the world's poorest nations.
But the 149 WTO members failed to achieve the full framework for the Doha Round launched in 2001, leaving out the most contentious issues, especially those on farm trade.
While being optimistic on a final trade deal, Deiss warned Saturday that a lot of work still laid ahead for the WTO members.
The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated that the net change in open interest last week increased by 8,694, posting a total open interest of 125,246 contracts. 
Traders are not to exceed the rule of thumb - 10% of equity to risk ratio.
If you do not fit this risk profile, traders are advised to consult their account executive for an option trading strategy.
WHAT DOES THE COTTON AND MARCH COTTON CHART LOOK LIKE?
Below is a quick overview of Cotton prices:
Cotton has been in a multi-year price decline that began from highs of 1.1720 (4/30/95) (near old highs from the civil war) to lows of 28.20 (10/31/01).
Recently, Cotton had a price advance from lows of 28.20 to highs of 84.80 (10/31/03).
Currently, Cotton has been in a price decline from highs of 84.80 to lows of 42.00 (8/31/04).
Cotton prices closed Friday at 55.53.
Below is an overview of March Cotton:
March Cotton had been in a six-week price decline that began from highs of 59.25 (10/13/05) to lows of 51.38 (12/02/05).
March Cotton began its current seven-week price advance from lows posted at 51.40 (12/01/05) and 51.38 (12/02/05) to recent highs of 56.65 (1/20/06).
March Cotton may have posted a bullish spread 'double bottom' at the 51.40 – 51.38 price level.
Confirmation of a spread 'double bottom' was a close above 55.40.
Cotton needs continual closes above 55.40 or a possible price failure may occur.
March Cotton has multiple unfilled price gaps above the current market price. The most recent unfilled price gap is between 57.45 and 57.50. 
March Cotton has three unfilled price gaps below the current market price. The first unfilled price gap is between 54.25 and 54.35. The second unfilled price gap is between 52.90 and 53.00. The third unfilled price gap is between 51.80 and 51.95.
March Cotton has closed above its 40-day moving average and 50-day moving average - which as of Friday was at was at 54.27 and 53.95, respectively.
March Cotton closed Friday at 55.53 - which is above its 100-day moving average of 54.31 and its 200-day moving average of 54.51.
Last week I wrote that March Cotton has developed a symmetrical bullish ‘V’ bottom formation or a rounded saucer bottom formation.
The upward ‘V’ trendline begins at lows of 51.38 through lows of 53.07 and if touched today would intersect this week at 54.75.
The rounded saucer bottom is more visual when you look at the daily March Cotton chart.
Listed below are the original trade signals that the March Cotton has recently posted:
On 12/01/05 and 12/02/05, March Cotton posted a potential spread 'double bottom' at 51.40 and 51.38, respectively.
On 12/12/05, March Cotton posted a weekly buy signal at 53.26.
On 12/16/05, March Cotton posted an 'intra-day' buy signal at 53.36.
On 12/19/06, March Cotton confirmed its spread double bottom by posting a close above 55.40.
On 1/16/06, March Cotton posted an ‘intra-week’ buy signal at 56.01.
On 1/20/06, March Cotton again posted an ‘intra-week’ buy signal at 56.01.
WHAT WERE TRADERS ADVISED TO DO LAST WEEK?
http://www.cleartrade.com/images/letter_1_22_06
WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?
Aggressive traders who established a long position in March Cotton at 53.26 are advised to leave stops below 54.50*.
Options traders who rolled their positions to May 58 calls are advised to risk 70% of purchase price**.
Aggressive traders who either added to their existing long position or established a long position on the 'intra-day' buy signal at 53.36 are advised to leave stops below  54.50*.
Aggressive traders who either added to their existing long position or established a long position on the 'intra-week' buy signal at 56.01 are advised to leave stops below 54.50*.
Aggressive traders who added to their existing long position or established a long position on Friday’s price decline are advised to leave stops below 54.50.
Below are possible ‘trading modules’ for futures traders to consider next week:
# 1) If March Cotton first posts a higher high than last week's high of 56.85:
Aggressive traders are advised to either add to there existing long positions or establish a long position, moving all stops below 56.00*.
Option traders are advised to purchase May 60 calls, risking 70% of purchase price**.
Longer-term option traders are advised to purchase multiple July 70 calls, risking 100% of purchase price**.
# 2) If March Cotton posts multiple closes over 57.20:
Aggressive traders are advised to either add to their established long position or establish a long position, placing stops for this position only below 56.01*.
Option traders are advised to purchase May 62 calls, risking 70% of purchase price**.
Our first objective will be the unfilled gap at 57.50.
Our intermediate-term objective will be 59.42.
# 3) If March Cotton posts multiple closes above 58.40:
Aggressive traders are advised to either add to their established long position or establish a long position, placing all stops below 56.65*.
Option traders are advised to purchase May 64 calls, risking 70% of purchase price**.
Our intermediate-term objective will be 59.42.
#4) If March Cotton first posts a lower low than last week’s low of 54.92:
Aggressive traders are advised to leave stops as proposed above*.
Option traders are advised to continue to risk 70% of purchase price of calls.
Below are possible reversal ‘trading modules’ to consider next week:
# 5) If March Cotton first posts a higher high than last week's high of 56.85 yet  reverses, posting a lower low than last week’s low of 54.92:
Aggressive futures traders will have liquidated their long positions below 56.00* and are advised to place resting buy stop orders at 56.86.
If March Cotton posted 56.86, aggressive traders will have reestablished their long positions, placing stops below 56.00*.
# 6) If March Cotton first posts a lower low than last week's low of 54.92 yet reverses, posting a higher high than last week's high of 56.85:
Aggressive futures traders are advised to place resting buy stop orders at 56.86.
If March Cotton posted 56.86, aggressive traders will have added to their existing long position, established a long position or reestablished their long positions, placing stops below 56.00*.
Below are possible ‘monthly reversal trading modules’ to consider:
# 7) If March Cotton posts a monthly close at or below 51.38:
Aggressive traders will have liquidated their long positions and are advised to sit on the sidelines and wait for another trading opportunity.
I have compiled some Cotton option facts for traders:
Cotton options for a two-year ‘implied volatility’ average are ranked number 37 out of 45.
37) Cotton (CT) High 47.91% - Low 21.51% - Current 23.54%.
Cotton options for a one-year ‘implied volatility’ average are ranked number 40 out of 45.
40) Cotton (CT) High 38.90% - Low 21.51% - Current 23.54%.
Cotton options for a six-month ‘implied volatility’ average are ranked number 40 out of 45.
40) Cotton (CT) High 38.90% - Low 21.51% - Current 23.54%.
DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?CT06H
-----------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?CT

* (Futures traders and their account executives are advised to discuss this suggested stop).

** (Option traders and their account executives are advised to discuss the suggested risk).

 

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.'

 

 FEBRUARY GOLD (GC6G)

This week February Gold will be placed in ‘Chart Watch’ because of a weekly recommendation for next week. However, Gold will not be placed in ‘Tech Talk’ because of the monthly close pending on Tuesday.

February Gold has a weekly recommendation: buy when trades 567.00 – sell when trades 553.00.

In the weeks to come I will be writing on April Gold because of the fast approaching first notice day for the February contract.

February Gold had been in a ten-week price advance that began from lows of 460.00 (11/04/05) to highs of 568.50 (1/20/06).

Recently, February Gold has been in a five-week price advance from lows of 592.30 to highs of 568.50.

The ‘Commitment of Traders’ report - published each Friday by the CFTC - indicated that the net change in open interest last week decreased by -5,624, posting a total open interest of 356,080 contracts.  

WHAT DOES THE GOLD CHART LOOK LIKE?

Gold has been in a multi-year price advance which began from lows of 252.50 (8/31/99) to recent highs of 568.50.

February Gold may be entering a consolidation period unless multiple closes above recent highs at 568.50 are posted.

February Gold has no unfilled gaps above the current market price.

February Gold has several unfilled price gaps below the current market price. The most recent unfilled price gap below the current market price is between 544.90 and 548.70.

February Gold has closed above its 40-day moving average of 528.90 and above its 50-day moving average - which as of Friday was at 521.70.

February Gold closed Friday at 558.80, which is above its 100-day moving average of 496.20 and its 200-day moving average of 468.00.

Listed below are the original trade signals that February Gold has recently posted:

On 1/09/06, February Gold posted a close above previous contract highs of 543.00.

On 1/11/06, February Gold posted a daily buy signal at 548.10.

Gold, due to extreme volatility, is not for the inexperienced trader.

Traders are not to exceed the rule of thumb - 10% of equity to risk ratio.

If you do not fit this risk profile, traders are advised to consult their account executive for an option trading strategy or are advised to use the C.B.O.T electronic Gold contract as their trading vehicle.

WHAT ARE TRADERS ADVISED TO DO NEXT WEEK?

Aggressive traders are advised to wait until the close of business January 31st before establishing a position.

Please contact your ClearTrade account executive for 'trading modules' designed to begin February 1st. 800-493-4444 or 773-561-9777.

I have compiled some Gold option facts for traders:

Gold options for a two-year ‘implied volatility’ average are ranked number 1 out of 45.

1) Gold (GC) High 22.08% - Low 10.31% - Current 22.08%.

Gold options for a one-year ‘implied volatility’ average are ranked number 1 out of 45.

1) Gold (GC) High 22.08% - Low 10.31% - Current 22.08%.

Gold options for a six-month ‘implied volatility’ average are ranked number 1 out of 45.

1) Gold (GC) High 22.08% - Low 10.31% - Current 22.08%.

DAILY CHART:
http://www.bohl.minot.com/d_Chart.cgi?GC06G
-----------------
WEEKLY CHART:
http://www.bohlish.com/w_Chart.cgi?GO

* (Futures traders and their account executives are advised to discuss this suggested stop).

** (Option traders and their account executives are advised to discuss the suggested risk).
---------------------------------------------------------

MAY SOYBEAN MEAL (SM6K)

This week I will add the May Soybean Meal to ‘Chart Watch’ because of a potential ‘monthly’ recommendation developing for February.

DAILY CHART:
http://www.bohlish.com/d_Chart.cgi?SM06K
------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?SM

---------------------------------------------------------

MARCH ORANGE JUICE (OJ6H)

This week I will add March Orange Juice to ‘Chart Watch’ because of a ‘weekly’ recommendation for next week. However, traders are advised to wait for the close of business January 31st before establishing a position.

March Orange Juice has a weekly recommendation: buy when trades 122.05 - sell when trades 115.90

DAILY CHART:
http://www.bohlish.com/d_Chart.cgi?OJ06H
------------
WEEKLY CHART:
http://www.bohl.minot.com/w_Chart.cgi?OJ

CURRENT 'MONTHLY' RECOMMENDATIONS FOR JANUARY:

- MARCH DOW JONES (DJ5H)

- MARCH EURO-CURRENCY

- MARCH SWISS FRANC

- FEBRUARY CRUDE OIL

 

FUTURE WATCH

Future watch will list developing 'monthly' recommendations to watch in January for February. 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 January 31 and sent via email for February.

 

- MAY SOYBEAN MEAL

- MAY OATS

 

 

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 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 and trade recommendations to ClearTrade®, Inc. clients. Scott Joss 'is a principal' of ClearTrade, Inc. and 'is a registered IB member' with the NFA.

ClearTrade®, Inc.
5415 N. Sheridan Rd.
Suite 2104
Chicago, IL 60640

(800) 493-4444
(773) 561-9777 Voice
(773) 561-9775 Fax

 

Mailto:research@cleartrade.com 
http://www.cleartrade.com/ 

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.

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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