Interpreting the System

As you all know by now, my market analysis comes primarily from the system described on the website that many of you have tried. The system seems to have the most consistency when time frames are combined rather than always following one time frame. For example, sell signals on a 60 nminute chart are more effective when the market is in a sell zone on a daily chart as well. I am going to try to communicate the status of some of the longer time frames in several markets to help filter some of the signals. I hope this is helpful for you.



In general, the S&P, NQ, Gold and Silver look positive and the Dollar and Treasury futures look negative. I realize that as I pick this up again some of these moves are fairly well established. Any of them can change at any time but this is where we are for now.


This morning, I think there is a chance to get short the bond future at 121'22 with a '24 tick stop and an initial open ended profit target. You could also consider buying puts from this level.







There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

System Update

Hello everyone. The system is up and running for many of you and I hope is offering some helpfuls signals.

Thank you to those that have given me feedback. It has been very valuable to make the system better and more user friendly. I am working on several things that should add to the systems value as a trading tool.

I am trying to create some tutorial videos as well as some ongoing market analysis from the system. These should be available soon. In the mean time, if you have any questions about the system, please contact me.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Wednesday

Good morning. The automation of my system is complete and available for those interested.

My Posts are based on the patterns and numbers given from this system. It will be more effective to communicate trading ideas through the system than through my Posts. I want to continue with the blog by adding different information/commentary that may be helpful with your trading rather than relaying what I see on an everchanging system.

Your input is always welcome.

Thank you.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Tuesday Morning Update

The S&P looks very similar to yesterday morning, down but probably a buy. Eventhough we went to 865.5 and now again back down to 840, I believe we can retest the 872 level again.

The dollar firmed up to 8600 but now looks very neutral. It is probably a fade 100 points either way from here.

I'm still slightly bearish for crude from 49.30. I think this weakness can continue into the mid to low 40's if it doesn't rebound today.

Gold sold off overnight and is now back under 890. Like the dollar, it looks neutral from here and I don't have a strong feel for it from these levels.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Monday Morning Update

The S&P's are going to open lower but still look positive from late last week's strength. For now I like the market under 851 for another test of the recent 872 highs.

The dollar has more room to rebound from Friday's selloff. I think it can trade up to 8585 at least.

Crude looks bearish to me and I think it's a sale at 49.30.

Finally, Gold looks like it will trade back under 900 for a short term trade. If if bounces back to 913 I think it would be a good risk/reward sale.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

After yesterday's trading it changed the picture somewhat on the markets I typically comment on. I'm somewhat bullish sp's from below 843 and bearish crude from above 49.50 for the day.

As for the dollar, it seems to have ran out of steam for now which probably has contributed to some support in gold. I'm neutral both.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Wednesday Morning Update

The S&P is in a daily neutral range but looks like an early day trade sale at 839. I'm also neutral gold at this point.

The dollar still looks bullish and may add to today's gains on a break above the overnight high of 8708. This is a chart pattern where I think you can buy the strength.

On the other hand, I'm bearish crude and think its a sale around 48.50

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

System

As many of you know, I've been working to automate my analysis into a 'system'. It is almost complete as we are just trying to make sure there are no missteps in it.

When completed it will be a big help for me to analyze more markets in more time frames. It is based on the buy and sell zones described on the www.stopsandoptions.com and can be modified to some degree with custom parameters.

It runs on Ninja Trader which allows you to test it on a simulated basis. If you have an interest in looking at it, please feel free to contact me.

I'll pick up the regular emails tomorrow. Thank you.


There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Monday Morning Update

The sp is going to open lower but near daily support in the upper 840's. The very early trade may be to sell mid to upper 850's but only for day trades. Later it may develop where this is a longer term buy.

The dollar is adding to Friday's advance and I still look for 87.60.

Crude is breaking down. If we get a bounce to 50.50 (June) it's a sale that could develop into a larger, longer term position.

Gold is up but not convincingly yet. I'd give it some time to see further strength but it most likely will be an opportunity to sell.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Friday Update

The sp has been much stronger than I thought it would be. I think it's in a short term range of 876 to 846 now. I've thought you could buy weakness and sell strength but the weakness has been very shallow and the strength has been impressive.

Today's strength in the dollar index may be the beginning of a bigger move, a possible break out. First objective would be to 87.60.

I'm less confident crude's move this morning has much behind it beyond today. 50.90 should be daytrading resistance.

Gold is somewhat making up for my mistakes in the sp. Without a recovery today, I would expect another 20 or 30 dollars on the downside.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Thursday Morning Update

The S&P is still a sale on the daily chart and an early sale at 855 on an intraday basis.

The dollar index and crude are dead neutral at current levels.

I have to stay bearish gold for now with a sell area above 894.


There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Crude Correction

My earlier post regarding crude was wrong. My buy level should've read 48.00, not 50.25. From an intraday perspective, I think it's a buy right around here at 48.80 and a sell at 50.50.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

The sp has lost the upward bias over the last day or so and I believe has entered into a range. I think it can be sold above 839 wth an objective to the low teens and possible back below 800.

The dollar index has been sideways for several days and is still a coin toss for the breakout. Play the range until its not a range. Sell 8680 and buy 8475.

Crude also has found a tight range around current levels. I think its a sale above 52.25 and a buy below 50.25.

Gold still looks mildly bearish. From a week to week perspective I don't think its a good short down here and is probably a good buy if we get to 850, but the daily charts just haven't shown any bullish signals for some time. From that shorter term perspective, its a sale still from the mid 890's.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Morning Update

This morning the S&P is 20 higher. This is much too strong to fade early in my view, perhaps later in the day but not in the first several hours. I will look for short term levels to buy.

No change in the dollar. I have no bias either way.

I see crude in a range from 52.80 to 47.40. It continues to look very similar to the sp. I think you can buy an early pull back to 51 (currently around 51.50) and look for a move to 52.80.

Gold is weaker again after moving briefly into the low 890's yesterday. There is potential for a bigger move down and I think you can still sell strenght in gold.


There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Wednesday

The sp's are in a range in my view. I think short term, the next few hours, you can sell 821 and look to buy 807's within the larger range of 830 to 765. The sp's made a low of 802.25 overnight which may be all we get on the downside for awhile.

The dollar too is in a range and topped out last night at 86.13. I am very neutral the dollar index between 8540 and 8580.

Crude continues weak for now but bottomed out overnight right near what I thought was the bottom of a broder range noted yesterday at 47.37. It's probably good for another short term sale at 49 to retest the overnight lows.

Gold continues to look a little bearish near term and is a sale if we retest the overnight high into the 890's.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Option Web Seminar

You are all invited to join this afternoon's option web seminar I'm doing. It's Part 2 of what will be 3 covering options. Today we'll dig into some strategies. The link below takes you to a sign up page. Hope you can make it.

http://www.pfgbest.com/webinar/eventSummary.asp?skey=333613352


There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Tuesday Markets

The S&P is lower again this morning. I don't think you should be long and would use a move above 818 to get out. I think it may trade in a general range from 840 down to 750 in the days/weeks ahead.

The dollar index has made a nice move from yesterday overnight lows but may have limted upside above 8580 from a daily perspective. Intraday looks strong for now but would look to exit longs at some point later today above 8580.

Gold is very mixed depending on the time frame you viewing. For intraday purposes I think its a sale at 888.

Crude has had a lot of correlation with the sp of late. Crude looks to be entering a broader range of 47.50 to 54. Intraday, I think you can sell the next bounce to 50.20.


There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Monday Update

Stocks are going to open lower and SP's are probably a sale above 840 if we can get back there; right now we're 831. I think it can trade back to 800.

The dollar index is weaker again from Friday but I still feel it may be a buy. I like the dollar under 84.40.

Crude is lower and showing mixed signals in the low 51 area. 51-51.25 should be support with 52.50 being resistance.

Gold continues to trade weak. It's an early sale above 886 for a day trade.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

I'm off to a somewhat late start this morning but it gives me an opportunity to look at the markets with all the employment data absorbed.

The S&P is lower after an inital, brief, rally took us to new highs of 844.50. The move off the lows the last month or so seems to be losing momentum and we could be starting a move back to below 790.

The dollar looks better today and I think it is a buy under 84.90.

Crude needs to continue to rally or it may be developing a range. I think it can be bought on a correction to around 51.10. The earlier the better for this and if it ends the day there I will turn more negative crude.

Gold is generally a little negative but I don't have strong conviction on it. I think it's a sale if it moves to 920 and possibly a buy around 903 with a tight stop near 896 for a short term trade.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results.

Thursday Morning Update

Stocks are going to open higher after a fairly impressive day yesterday. I would think you can but early weakness under 815 for day trade purposes. The daily chart may turn more positive with a close up over 820 today but that is awhile off. Also, tomorrow morning's unemployment report is a wild card for more intermediate term direction. I do think, however, that the market can trade up into the mid to upper 800's for this move.

The dollar has broken down somewhat overnight. I don't have a strong view on the dollar for now but for the short term (day trading) it can probably be sold first time back up to 85.30 (currently trading at 84.97).

Crude firmed up over night and I see it is making new highs as I write this. If it retraces to 50.25, I think it is a buy.

Gold has softened overnight and hasn't of yet been supported by the weaker dollar. Again we have short term bearish dollar and gold charts which are unlikely to decline together for too long. Recently we had the both daily charts negative right before gold ran up from 885 to 960 while the dollar collapsed from 87.50 to 83. I can see a scenario where they both rally but less likely that they both fall. If I had to choose one to fall, I would have to pick the dollar.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Wednesday Update

Stocks and the dollar look very neutral or range bound at this point. The sp is going to open weaker and I would look for support in the low 770's early. The dollar has developed a range generally between 85.50 and 86.50. I am neutral the dollar within that range.

Gold is showing some early strenth and challenging the low 930's which has been recent resistance. I am not convinced it can make any meaningful break above this area.

Crude has been trading weak the last couple of days in what I think is an area of support under 49.50. The intra day charts just haven't shown any strength to trade against. More patience is probably in order.



There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Option Course Webinar

For those of you interested in options, I will be doing an Option Webinar this afternoon at 3:30  Central time.  To participate you can just click on the link below.  It will be archived for those who would like to see it but can't make today's time.  Thank you.

To join the event as an attendee
-------------------------------------------------------
1. Go to https://pfgbest.webex.com/pfgbest/onstage/g.php?d=333410049&t=a&EA=tslater%40stopsandoptions.com&ET=186fdb5d50aa65aef2234f13932d9b8f&ETR=b000d59a9e4325003481ba0df8c4095a
2. Click "Join Now".

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Tuesday Morning Update

Yesterday's trade hurt the modestly bullish picture for stocks, the dollar and crude.  They are all more neutral now and I would expect more two way trade.  I think there is resistance in the sp in the upper 790's and support in the low 780's.  For the dollar, 86.20 to 85.30, and 51 to 49.30 in crude.

Gold looks similar to yesterday in that I think it's a little bearish with resistance above 930 (yesterday I mistakenly wrote 830 instead).

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Monday Morning Update

Stocks are going to open lower and, at least for the early going, I think there may be more weakness from the upper 790's. However, this pullback from the last weeks rally is an opportunity to consider some longer term bullish positions. So I would be patient to give the weakness some room and perhaps trade it short early, but if the intraday charts start to stabilize it could be a nice longer term (days) buy.

A similar scenario has developed with crude and the reverse scenario is present with the dollar index.

Gold looks bearish today and I think its a sale in the low 830's.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Friday Update

From the daily charts, this morning's moves in many markets look like fades. Stocks are down but I think its too early to call for an end of the recent rally; bonds and notes are higher but I think their recent runs are running out of gas; and gold and crude are somewhat range bound so I think this morning's weakness in both is limited.


There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

DX

The dollar index has bounced to 84.20. I think it can be sold here with a 40 point stop.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Thursday Morning Update

Again, in general, stocks and bonds look like a buy and the dollar looks like a sale. The sp's have built resistance in the low 820's but it still looks bullish for now. The dollar has been range trading all week which looks like a consolidation that may break out again on the downside.

This mornings strength in May crude looks like it continue. It has made new highs for the move and may rally to 56.50. Gold, too, is strong this morning but looks more neutral.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Travel Day

I didn't get very far yesterday. As windy as Texas is, it has nothing on Wyoming. I'll try it again today.

As far as the markets go, generally it looks like you can buy weakness in stocks and bonds and sell strength in the dollar. I am more neutral both crude and gold from these levels. Have a good day and I hope to pick things up tomorrow from the office.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Tuesday's Markets

I will be traveling all day Tuesday so I will not be able to Post anything. Monday's early strength just kept getting stronger. If it doesn't continue Tuesday I would think it will at least hold on to much of the gains.

The dollar continues to look generally weak. I'm neutral to mildly bullish crude and still feel Gold will trade under 930.

I will update again on Wednesday.

Thank you and good luck with your trading.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Monday Morning Update

Stocks are up 18+ off the new Geitner plan information...another trillon dollars. S&P's are looking better and may rally to the mid 800's in the intermediate term. Short term, meaning the first couple hours, I think is a coin toss.

The dollar traded down to 83.38 overnight but has since revcovered. This morning it looks like a sale at 8445 and a buy at 8400 for day tradng.

Ten year notes have maintained a very tight range since the Fed anouncement above 124.16. It remains bullsh on the longer term chart but the intraday charts are so sideways, it too is a coin toss for the next break out.

May crude is currently falling but I think there is support under 51.50 and resistance over 52.25. Gold can trade below 930 and I think if it trades back to the upper 950's it's a sale.
There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

DX

The dollar index has been pretty quiet the last few hours and doesn't seem like its going to break. I think the dollar is still bearish but realize there could be big moves over the weekend after such a volatile week. At minimum, I would keep a stop working.


There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

DX Stop

The dx is trading around 84.40 right now and put in a recent high of 84.55. It still looks to have a negative bias for now but it is worth noting that Fed Chairman Bernanke is speaking at the top of the hour and could cause more volatility so it is important to have a stop in; 85.05 would be my stop level.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

DX

The dollar may be running out of steam already. I think you can sell 84.20 in the June DX for a day trade.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Friday Morning Update

Yesterday's selloff in the sp as the day wore on gave the negative bias at least one more day to go. Again this morning it looks as if it can be switched to a positive one if we can end the day at these levels (currently 783) or above.

I'm generally bullish notes at this point. Yesterday afternoon it dipped to 124'14 below the 124'16 level I thought would be good support. That should remain a good spot to get long should we go back there for the day.

The dollar index is recovering modestly from the recent selloff. I think it should be played from the short side and will post a specific level as a daytrade emerges.

Crude is in the middle of its daily support resistance. I think you can fade it either way, ideally 49.30 to 53.80 in May, 48.40 to 53.80 in April. I'm neutral gold after it's big reversal the other day. Given the way the charts look (somewhat bearish) and what the dollar is doing, I'm standing aside.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

A trillion dollars can really change the enviornment in a hurray. The sp's are going to flip from a sell bias to a buy with anything close to an unchanged or better performance today. For now it looks like a range trade between low 780's to mid 790's.

Ten year notes look like a buy at 124'16. The dollar is in a free fall and a specific sell level is too far away to even list. I think it could possibly fall to 80. Crude is continuing its run but I think it would be a sale today above 53. I'm neutral gold.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

Well the Fed statements certainly moved the markets some...to say the least. Stocks and bonds took off, as did gold and crude while the dollar tanked. The interest rate and fx moves are so big that they are likely to see some continuation. I think it is less clear in stocks.

Crude firmed up enough to keep the upward bias going. Gold firmed up, but like stocks, I think its less clear if it will continue significantly in the short run.


There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

We're an hour away from the release of the Fed meeting statements which may certainly move the markets around some. Nothing technically, however, has really changed from my morning post. I would not try to pick a bottom in either the dollar index or gold for the day. Crude is a little softer than I expected but there is still time for it to firm up and maintain its positive momentum.

I don't have a short term view of stocks from here.


There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Wednesday Morning Update

Stocks are lower but made new highs for the move late yesterday. I think it is ok to be short calls/call spreads up here and look to cover and sell puts/put spreads on a move back into the low 700's.

The dollar and gold are both weaker this morning. The dollar traded through 87.80 after my post yesterday and has been softening since. I think there is a real risk that it continues to decline. Gold also looks weak and missed my 922 level yesterday by topping at 921.7 after my post. It would be interesting to see both gold and the dollar continue to break but that's what they look like technically at this point.

Crude still looks somewhat bullish with potential to 52.50-55 (April). Support is at 47.80.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Webinar

There has been a mix up with the scheduling of the option webinar. It is not today as I thought and it is not next Tuesday the 24th as the link states, it is now going to be Tuesday March 31st, at 3:30 central. Thank you.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Tuesday Morning Update

We had a huge increase in Feb housing starts released this morning but apparently not huge enough for the stock indexes. I think you can sell a rally to 764 with an 8 point risk and look for a move down to 735 in June sp.

Both Gold and the Dollar index also look somewhat bearish today. I would try to sell strength in both, 922 in April gold and 87.80 in the Dollar. Crude looks more bullish so I would look to buy weakness around 46.80.

Finally, I'm going to do an online webinar this afternoon after the markets close, 3:30 central, on options. If you would like to watch you can use the link below to sign up.

http://www.pfgbest.com/webinar/eventSummary.asp?skey=333410049


There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

Both the dx and EC traded back through our entry levels but gave some opportunity for some modest profits. The original 87.55 stop level in the DX may now be a new level to get short for an overnight trade but there is certainly more risk in entering a trade this late in the day for overnight than just daytrading.

I've been waiting for the recent strength in the stock indexes to show some signs of topping because the sp and nq are in areas where I think they are good longer term sales. The nasdaq has now turned a little negative for the day and I think it could be the beginning of the end for this move up.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Stops on DX and EC

Move stops on the EC and DX to break even.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

EC and Dollar index

Just for a short term trade, I think you can buy the June EC at 1.3005 with a 35 tick stop (1.2970) and look for 1.31 profit target.

Reverse trade for the dollar index would be selling the June dx at 87.30 with a 25 tick stop and look for 86.75.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Gold

April Gold recently went traded down to 921.1 holding the overnight low of 919.60. It is now around 930. If you got long at 924 I would bring my stop to break even. If gold fails, I think it fails from right here.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Friday Morning Update

Stocks are higher again after a three day rally. Short term continues to suggest buying dips but longer term it looks like on the high end of a range that should decline to the low 720's in the June SP.

The dollar index continues to look somewhat range bound from 87.50 to 88.60. EC as well.

I would not sell crude or gold at this point. Spots to consider getting long early Friday would be 46.50 in April CL and 924 in Gold.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Gold

Gold firmed up to 931, a bit more than I would have thought and may have killed any short term negative trade. It is more neutral now so if short I would cover under 920.

It jumped on the report that the Swiss Central bank cut rates to .25% and said it would intervene in the currency markets to dampen the SF's rise. The SF promptly sold off on the news 200+ ticks.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Thursday Morning Update

The dollar index has just firmed up in the last 15 minutes to the top or its recent range. It may find resistance here around 88.90 (June) and support under 88.45

Stock index front months roll to June this morning. Bot the sp and nq are more neutral than they have been for quite some time in my view. About the same levels I mentioned late yesterday are still relevant for this morning, 708-740 in June sp and 1104 to 1130 in June nq.

Crude is more range bound also, but still has some negative momentum from its recent fall. 44 Should be good resistance at least the first several hours of trade today.

Gold is up to what I think is a pivotal level, 920. I think it could be a good sale early for a move back to 900.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

The Nasdaq stalled right above the 1132 level at 1135.75. That level is analogous with 1145 in the SP. I think the NQ is going back under 1100 and SP's go back under 710.

The dollar just recently took out yesterday's low by a tick and bounced right back above 88.00. I still think the dollar is in a short term range.

Crude is back near 44.60 after dipping below it earlier and then rallying to 45.80. Again, for a little larger view, this area may hold for another run to the upper 40's. If that doesn't materialize then this level will be a more neutral area.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Wednesday Morning Update

Following up on the dollar comment from my last post yesterday, the dollar index traded back up over 89 to 89.035 and has since fallen to 88.00. As for this morning, it may just stay in the recent range and bounce back to 88.50. An early break of yesterday's low's of 87.83 may, however, signal further weakness. We'll look at it again if that happens.

Stock indexes are higher on follow through from yesterday's large gains. More gains today, and yesterday's in the NQ, will make the charts decidely more neutral between 810ish and 845 in the sp and 1100 and 1132 in the NQ.

Crude has longer term support around 44.60 (overnight low was 44.69) at least for one more day. The way the intra day charts look this morning I would think we can go test that level again (currently 45).

I'm more neutral gold for now around 900. More broadly it looks like a sale at 919 and a buy at 858.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

S&P's and the Dollar

The S&P's and certainly the NQ have done very well today. New sell levels for these markets will be around 746 and 1142 for tomorrow it looks like. As there wasn't much of a backup today, there may be an opportunity to trade it from the long side tomorrow.

It's kind of an odd time to comment on the dollar but it looks like it may be a nice sell around the 89.00 level for a move back down towards todays lows. We'll look for that trade in the morning.

Have a good night.


There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Crude and Gold Update

Crude finally made its way back to 46.80 and is now around 47. If it gets back to 47.25 I would place a stop at break even (including costs). I think crude can continue to grind higher but these are not entry levels for long term holds which I don't think I made clear.

Gold broke down to 892.5 and looks like it can continue to build a somewhat lower range but it is too late to trade it, in my view, today. I will most likely want to sell strength early again tomorrow.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

S&P's

For day trading only, I think you can buy the S&P in the mid 890's for the next hour or so and sell on further strength later in the day.

Option traders may want to consider legging into a short call spread by first purchasing a cheaper call with the intent on selling a more expensive one, hopefully at better levels, later in the day.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Crude and Gold

I think it's not a great risk reward to buy this strength in crude at this time of day; later perhaps but not now. I would be patient and look for 46.80. It's arguably a sell above 47.80 with a stop above yesterday's highs of 48.83 and a target of 46.80.

Gold looks weak and can be sold for a day trade around 911-916. I think gold can trade under 890.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Tuesday Morning Update

The S&P's are going to open higher but near the levels we failed from yesterday. There is room technically to move substantially in either direction. I think it can push higher between mid 680's to mid 690's and ulitmately to the mid 700's in the not too distant future. But it's a tough call to bet on as the moves up won't have any longer term technical base or support and likely to be more opportunities to establish shorts. For now there is no basis for getting real bullish other than real short term day trading. That can change of course but it's not there yet. I think if the market rallies you can sell call spreads. The vix is still quite high and will decline most likely as the market rallies.

Crude continues to rally and I'll update at the top of the hour levels to consider getting long again. Just the reverse for short term gold trading.


There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Crude Oil Stop

April Crude is around 47.30 now. If you got long at 46.50 or below I would place a stop at break even oco sell it at 47.50 for a short term trade.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Gold

Gold has softened to a point where I think it is a short term sale again. For the next hour or so, sell April at 930 with a $7 stop and look for another break of today's lows.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Crude oil and the S&P

Crude oil traded up to 48.83 but has since traded back a bit. Now I think it can be bought at 46.50 and look for another mover toward 49.50.

The S&P's early strength makes it a more neutral market around 682.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

New Week, Same Story

S&P's are going to open lower and continue to look weak. If we can rally to 682 in the first hour I think its a sale; it's currently 674.

The dollar is firm and can trade to 90.00 from it's current 89.40 level.

I continue to like crude and think it will push towards $49 (April).

Gold longer term still seems bullish but it is very neutral around 935 short term.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future result

Friday Markets

The unemployment data is out and terrible as expected...I don't need to go through the data. The sp is up moderately thus far, 690ish, but looks like any rally will meet strong resistance. The market has come down so far that significant rallies are a constant risk but are all likely to be sold. If we rally into the upper teens , >715, then I would look to add short call premium. The downside is really open ended technically. Short term support is in the upper 670's.

Ten year notes have stayed somewhat range bound but look a little more bullish now. Short term, 122'30 is support and 124'20 is resistance. I wouldn't expect notes to push the upper end of that range if stocks are rebounding.

The dollar index should see some support here under 88.40 but I would let this early weakness go for awhile to see if it gains any momentum. If not, later in the day, the dx may be a good buy here.

Gold is higher but I think you must buy weakness, below 930.

Yesterday I mentioned I thought CL was a buy under 43 and I see on the charts it went to 42.86 in the last hour of the regular session, but I didn't notice it at the time. I still am of the view CL can rally above 48. Today, under 44.40 in April would be a level to consider getting long.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Update on SP, EC, and Gold

The S&P traded above 700 briefly after the cash opening but has been under pressure since then, recently breaking yesterday's low's.

EC should've broken down again if it was good to the downside so I would exit the sale at 1.2550. Similar situation in gold, I would exit any shorts before the close.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Gold

Gold is a day trade sell here at 922 with a $15 stop.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Post Error

My last Post, for the EC, didn't come through on my email but three blank emails did an hour ago? It is on the blog itself ok. Please check the blog itself at your earliest convenience:

http://stopsandoptions.blogspot.com/




There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

EC

The EC is breaking down today towards a very pivotal level, 124.50-80. Initially, that is a buy zone on a daily chart for today, but the early intraday charts are very negative. A break of this level very well could lead to a move to test the Oct low of 1.2351 and 1.2220 below that. I think it can be sold above 1.2550 with a 100 point stop.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Thursday Morning Update

The S&P is lower again this morning. I think the early trade is to sell strength, around 698-700. If we can hold near Tuesday's lows, 681.50, for the first several hours of the day, then I believe we can make another run at yesterday's highs prior to tomorrow's release of the unemployment data. The big picture still remains technically very weak regardless of these short term rallies.

Gold has rebounded overnight to the mid teens (816). I think first time up into the low 820's, near yesterdays highs, would be a sale. The picture may swing back postive in the next day or two if it can hold.

The dollar is up and continues to look bulllish. ECB and BOE cut rates again as there economies are potentially worse off than ours.

April crude oil looks like a buy this morning under 43.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Gold

A daily April gold chart is shown below. We recently broke yesterday's low and now headed towards the bottom of the Bollinger Band line which is currently around 870. If we get there, that will be a place to consider getting long.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Gold

April Gold is trading around 910. This is a good spot to cover day trade shorts if you sold near 920 as mentioned in first update this morning. If gold breaks yesterday's low of 905.7 we may get a bigger selloff and I would look for 870.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Wednesday Morning Markets

The S&P is up in pre market trading to 700 after another weak performance yesterday. Resistance should come in around 712 early and 730ish if we somehow gain some momentum. I continue to think selling calls on rallies is the way to go with a vix near 50.

Ten year notes are lower, 122'02, after failing the last couple of days over 123'00. An early rally to 122'12 would be an opportunity to get short and with 121 as an objective.

The dollar remains bullish with support around 89.00.

Gold's drop yesterday was a little more than I expected and has hurt the charts somewhat. April is now trading 920 and is probably a day trade sale at this point. 870 would be an excellent buying opportunity if we can get there.

Crude is trying to push higher again today and I think you can go with it, at least initially. As I said a few days ago, it looks like it has room to rally to 48.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Morning Update

Stocks continue to look terrible. Rallies should be sold...calls and/call spreads are preferred with the vix so high, 50+. 720 and 740 would be resistance if we can rally. Bernanke and Geitner speak this morning so who knows how the markets will react to their testimonies, but technically, it's probably a sale at any level above yesterday's close.

Ten year notes are more neutral looking but still a sale around 123'00 like yesterday. It seems like the federal budget mess etc...is more negative for stocks than fixed income in the short run as the continuing struggling economy trumps future inflation fears.

Even gold is softening more. Gold has short term support today under 925 and resistance at 940.

The dollar looks bullish and I will try to come back with specific trade there today.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Morning Update

Stock indexes are down again, trading below 720. I want to sell calls on strength and the upper 720's early in the day would be the first opportunity if we get there.

Ten year notes have resistance at 123'00 and would provide a good opportunity to sell calls if we get there, particulary early in the day.

The Dollar index continues to look mildly bullish. 87.80-88.10 is support.

Gold is in a short term range here today but I am generally bullish. The overnight range is 940-960 and I think it can stay within those levels today.

April crude oil is down $3 to 41.70. There still may be a short term rally to $48 in the coming days and this, under 42.40, should be support. Longer term charts are still very bearish so this, if it develops, would be a rally to sell into for the bigger picture.



There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Gold

Below is a Daily chart on April Gold.  As bullish as gold seems to be on a fundamental basis (summarized by the headline I saw yesterday 'Trillions are the new Billions') there is a sell zone today at 962 and , similar to yesterday, the buy zone is 941.  Weekly support is down at 925 and intraday support at 952.  

  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Friday Morning Update

The S&P this morning broke the November lows and still looks negative.  Technically, it continues to be a market to sell any strength.  In the early going today, any bounce into the mid 740's is probably good for a daytrade sale.  Longer term the risk/reward is worse today than yesterday's early strength but still no real sign of a bottom. The sp is currently at 735.

Gold also is continuing it's move higher from yesterday mornings early low's.  The mid 960's is actually a good early profit taking level.

Ten year notes are up but face early resistance hear at 122'16.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

S&P's and Gold

The early S&P high of 779 was never broken and now its closing fairly weak, breaking yesterday's low. The early levels did offer an opportunity to sell calls.

Gold firmed up from under 940 and is now around 947. Nice trade so far to those clients who pulled the trigger in the buy zone.

We'll look for continuation of these moves tomorrow. Have a nice afternoon.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

Thus far the sp has stopped at 879, notes at 121'10 (since last post) and gold is now beneath 940.

Below are charts of the support I was referring to in the TY and Gold and the resistance in the SP.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

The S&P's are going to open higher, currently the March contract is up 12 at 773.50.  Yesterday's high was 779.50.  There is still resistance there in the upper 870's and I think it is a good place to establish short call spreads if you don't have any.  

Ten Year notes are just the opposite with support under 121'10.  intra-day I think notes can be sold above 121'28 but would consider writing put spreads under 121'10 for a longer term trade.

The dollar index is mildly bullish with support at 87.25 and resistance at 88.60.

Gold has come way off its earlier highs and I will be looking for a spot to buy April under $840.

Crude has finally found short term support.  I see a possible move to 48.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Stops and Options

The Stops and Options website, www.stopsandoptions.com , has been updated recently to incorporate a new filter in the trade set ups. Take a look at your earliest convenience. As I mentioned the other day, these new trade setups are being automated to give more exact and complete signals across more markets.

I feel the stock indexes are a good place for option writing again after a very tough year or so. Volatility is still relatively high (even with today's large decline) and liquidity is very good in the mini sp options. Many clients have been short both put and call spreads which limits exposure but still takes advantage of the time decay while the market trades between the strikes. That, of course, can change but I think can be managed.

We have so far had a successful re-test of the November lows in the SP's and we await a Presidential speech tonight, but today's rally brings us back to levels where selling calls (and call spreads) should be considered.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Update

I have been working to modify and automate my trading strategy to make it more disciplined, across more markets, and in more time frames, to offer more assistance in your trading.

The system on a day to day basis is very reasonable to follow manually but requires much more patience and larger stop values than intra-day traders would expect. For those reasons, the day to day system is more suited for option positions than futures.

It's a good environment in my view to consider writing options on the sp's because of the relative high volatility (higher premiums) and a market that is 40+% off it's highs.

As for today's markets, the S&P's may have room to rally to over 800 again but should hit substantial resistance again around 810 if it did so. The dollar and gold can still be bought on dips and interest rates are still range trading. Technically, crude looks strong intra-day but is analogous to the S&P's at 810.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Tuesday Morning Update

Not a great opening ahead for stocks.  The S&P's settled Friday at 820 and they are currently 795.  On the Daily charts this looks like possible support but we'll have to give it some room in the early hours.  The mood seems to be deteriorating again as the onslaught of bad economic news doesn't let up.  I won't begin to list the concerns, you know what they are. 

Recent trends in Gold, Silver and crude continue.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Range Trades

For the last month the stock indexes, interest rates, dollar index, and the commodity index have traded within ever shrinking ranges.   This will not last forever and when breakouts occur, we could return to some bigger volatility.  But for now, option writing has been working and should continue until the enviornment changes.  On the other hand, futures trades need to be very short term oriented.

The exceptions have been gold,  silver, and crude.  Gold and silver trending higher and crude trending lower.  Gold and silver continue to look technically like durable trends.  Crude on the other hand, I'm more suspicious of continuing lower, but I won't call an end to it until the charts change.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Gold and Silver

Gold and silver are up substantially again today.  There continues to be significant upside for both in the bigger picture from a technical standpoint as well as fundamental view.  Futures and options on futures are certainly ways to play these markets but single stock futures of the metals companies and physical bullion and coins are also worth considering.  I'll continue to try to pick out specific futures trades, but if you have interest in the others, feel free to contact me for futher information.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

S&P's

The s&p's are currently trading around 830.  I think this is an important level for today's close.  Early today, the upper 820's may be a good buy for a short term rally to upper 840's.  You'd have to risk yesterday's low of  819.50 so the risk/reward is not great.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

S&P's

Despite the big selloff today, the S&P is still in a range and may hold near current levels, <830. The market looks now on the downside the way it did on the upside in the 860's.

The reaction to all the government efforts to stabilize the economy is very negative today but this is going to drag on for perhaps months. So until the charts turn more negative (which can happen soon) I think one has to be very careful to sell into this weakness.

Gold continues to hang onto it's earlier gains and is bullish.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Waiting on Washington

With the Treasury plan only an hour or so away and the sp charts very neutral, I'm waiting to see some reaction.  

Gold, however, has opened up today with some nice gains overnight and continues to look bullish.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

The stock market remained in its recent range while I was out at the end of last week.  No change with that again today.  I still have mixed signals at these levels, 860's. 

Notes continue to look short term bearish with at least another point on the downside likely.

I'm still looking for a definate buy signal in gold but feel eventually that it will rally. 

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Update

The market never regained any positive momentum from the mid day selloff.   It looks range bound to me until Friday's unemployment data.

I am going to Chicago tomorrow and returning Friday.  I won't be in the office at all either day and will have to pick it up on Monday.  Not great timing with unemployment coming Friday but should be a productive trip.  

While I'm away, please call 866-249-4024 for any assistance.  Thanks and good luck with your trading.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Crude, Stocks

Crude stalled and broke down through our stop.  Stand aside for now.

S&P's have also come back down after ralling to 849.50.   It failed right above our daily sell zone. Any buy signal won't come until later, if at all.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Crude

Crude traded back down to 40.78 and is now around 41.50.  If you were able to get in, you can sell it here for a quick profit and probably be able to do the trade again.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Crude Oil

Buy March Crude at 41.00 with a 60 cent stop.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Morning Update

Yesterday's activity turned both the S&P and crude to more positive charts.  I think there will be a trade (short term) to buy the sp under 832 and March crude under 41.  Option traders should consider getting out of long put positions and into short puts or put spreads.

Gold remains bullish under 900 and the 10 years reamain bearish.  

I don't have a view on the dollar at the moment.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

EC

the EC just traded through 1.3020.  I'd get out and take profits.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

EC

The EC came back to 1.2937 aobut 10 minutes after the last post so hopefully you were able to get in.  If so, raise stop to break even and look to take profits at 1.3020.  EC is currently at 1.2990.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

EC

Buy the March EC at 1.2940 with a 30 tick stop.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

I think the SP's are looking better but upper 820's low 830's are going to be hard to get through today.  I still think buying weakness will payoff in the next day or so with a move to the upper 800's.

Ten year notes look more negative again.  I think you can sell rallies for the rest of the day.

I missed the EC and Swiss right after the last post.  Now they're tough on a risk/reward basis but may have another chance to get long later.

It's interesting that gold is trading with the dollar recently and not against it.  It seems easy t o make a case for gold regardless of the dollar.  The daily chart still looks bullish from 900.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Morning Update

This morning I'm looking for places to buy the Swiss and Euro currencies, gold, and probably the sp.  I'm looking to sell the ten year notes.  I'll come back with levels.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

SP's

I think the S&P's may close stronger today.  I'm trying to buy 816  with a 4 point stop for a day trade with the idea that it can push back towards the highs for the close.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

More Mixed Markets

The S&P is down again to start a new month.  The technicals remain mixed in that the monthly charts are extremely negative but with substantial risk for a correction, the weekly charts are more positive suggesting a possible correction to the mid 900's, and the daily is currently negative. 850 seems to be the middle of the range develeped since mid November with no real indications that is going to change. 

The market reminds me of the timeframe when Bush and Gore were in the disputed election.  The market traded day to day based on comments and progress on the legal settlement.  Now we are trading on day to day progress and comments on the stimulus and Tarp plans.  The more the market focuses on the problems and the divide in government response, the more bearish the market trades.  When optimism builds over any solution, or even something resembling a plan, the market firms up.  I think the maket will eventually trade up as a result of the inevitable stimulus/Tarp action in the next few weeks to 900+ in the March S&P.   If that does take place, however,  it will only look like a better opportunity for bearish trades.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

S&P's

The stock market is down again and softening.  We had better than expected 4th quarter GDP data earlier but the focus is on the ongoing concern of a worsening economy and the diminishing (in my view anyway) likelihood that much can be done about it.  The index charts are very negative but, as I have mentioned several times, I think there is substantial room for bear market corrections.  I don't have a strong short term conviction on stocks at this time as much as I'm searching for one.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Stocks and Bonds

Both stocks and bonds traded very poorly today.  The fundamental economic news and the information coming out of Washington are just overwhelmingly negative.  Gold, however, looks positive again and had a nice rally.

We were stopped out of the note trade and will take a fresh look tomorrow.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

10 year notes

I think you can buy the 10 year note here at 123'11 with a 10 tick (123'01) stop.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

The S&P's should find support in the low 850's and near term resistance in the mid 860's.   Ten year notes also are near support around 123'11. 

The dollar is still very mixed and I think it can trade between 8440 and 8570.

Gold continues to correct from recent strength and may have more to go.  There are inventory numbers coming later for crude, but for now it looks like strength should be sold.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

S&P's

The market held up nicely today and was able to add a little to the early gains.  The charts are more positive than they have been, or better stated, less negative. Buying dips willl be more supported by the technicals at least for the short term. This still looks like a correction in a bear market, it's just that there seems to be a fair amount of room on the upside for it to correct at the moment. 

We've thawed out here in Texas and will pick it up tomorrow as usual. 

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Ice Storm

I'll be working from home for awhile this morning until the streets, which are a sheet of ice, thaw.  Please email rather than call this morning.

Markets are better with the Bad Bank solution talk from Washington.  Also, the Fed will conclude their meeting and issue a statement later.  I think there is potential for a much larger move in the S&P, maybe another 100 points.  I have mentioned it earlier in the week and it has been difficult to pick stop levels but stocks feel like gold at 850 last week.

Gold is correcting from its recent rise and may have a bit more to go, but I'm looking again to get long gold. 

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Tuesday Update

The markets in general look very similar to yesterday.  Short term the stock indices look like they can work higher but the daily levels have yet to turn positive.  Yesterday's purchase was a bit optimistic in hindsight.  

Bonds still look a little heavy short term  but are in a reverse situation as stocks with their daily charts still positive.  

Gold's early weakness may develop into a buy signal which I'll be watching closely.

Still no strong view of the dollar short term.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

S&P's

Stocks have slipped to bring us down to our stop in the S&P.  It's a very mixed technical picture at this point.   

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

SP's

The stock market has broken Thursday's and Friday's highs and is a move that I think may feed on itself.  If we get a near term correction to 839 I think you can buy it with a 14 point stop with an open ended objective for now.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Monday Morning Update

Good morning.  The S&P is at 830 which is right about where it was when I left on Friday.  The technicals haven't changed much since then in that it above 830 is a medium term resistance level that suggests buying puts and/or selling calls.  However, like Friday, I am not overly bearish for a few reasons.  The weekly charts show a buy zone under 849 and have for the last few weeks.  The Monthly chart is still very bearish but with huge amount of upside correction risk which wouldn't alter the bearish picture.   The daily and intraday charts are still bearish but can turn at any time on strength, probably in the 840's.  With that I think it is possible for a move up to 950 again.  So the highs of Thursday and Friday in the mid 830's are very pivotal to me.  

There is a Fed meeting this week and they will likely keep interest rates unchanged.  Long term treasury futures have been sliding recently and I think they can make a bigger move down outside of another dramatric fall in stocks.  

The CRB has turned a little more positive which is consistent with the recent firming in oil and metals.  I think both gold and crude can rally more.  Gold perhaps significantly.  

I don't have a strong view on the dollar at the moment.  

As I mentioned Friday, I left early to attend a PFGBEST conference in Phoenix.  It was excellent and there are a lot of tools available to help with your trading and investing.  I will be adding a lot of that information to the Stops and Options website asap.  I'll keep you posted.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

Stocks have become more mixed as they've rallied today, in that they've looked too strong short term to sell and too negative longer term to buy.  Here in the low 830's is a good place to enter longer term option positions, buy puts and sell calls.  But the intraday stuff is not likely to turn negative before I leave for the day.  Aside from the technicals, we've been down seemingly every day this year and it feels like we need to correct higher.  Crude has reversed nicely and may rally intermediate term to 53.  Gold has broken out and may have a more sustainable move higher. Higher commodities seems to have a positive correlation with stocks.  I guess I'm not as bearish as the charts suggest.  

I'll post any changes, otherwise, have a great weekend.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Stocks

After the first hour of trading we have rallied back somewhat to the level I mentioned earlier, 815. This may turn out to be a reasonable daytrade sell level but I want to give it at least another hour as there is a chance we rally closer to the daily sell zone of 826 in the near term.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Friday Update

Stocks are lower: dollar and gold are higher.  The gold trade from yesterday was stopped out overnight.  That's a shame as gold is up $20, just what we thought might happen.  It's also interesting that gold has been holding and now rallying as the dollar continues to go up.  This is not a good sign for treasury futures.

None of the overnight moves are out of line with the channels they've developed.  

If we can get a rebound into the mid teens in the S&P, there may be a day trade sell.  

I will be leaving about an hour before the stock market close today to travel to Phoenix for a PFGBEST.com weekend conference.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Gold and S&P's

Gold has stayed firm all day and now looks better for a possible run to 890.  Keep stop at same level over night.

Stocks have rebounded to near the daily sell zones which are probably good levels to sell calls again.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Update

Gold is hanging in there.  It made new highs after an opportunity to get in and has held the stop level.  

If the S&P's are going to hold it is going to do it here, 810ish.  I've covered some short calls,  but big picture still looks bearish.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Gold

Buy Feb Gold at 857.5 with a $5 stop for initially a day trade.  If we can hold the gains for the day, the daily chart will look much more positive.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Thursday Morning Update

S&P's are down 10 points after more bad economic data just released.   Jobless claims and housing starts weaker than expected, again.  However, yesterday's late rally was big enough to help the charts somewhat.  I would expect support in the mid teens early this morning and if it holds, as the day wears on, maybe we build on yesterday's move.  If it breaks through there, then it is all negative technically.

The dollar is down but well off its lows.  

March crude looks similar to the sp's with 42.20 analogous to 815.  Gold has been quiet and range bound.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

S&P's

The S&P's held yesterday's lows earlier on the push towards 800 and have now ralllied back to make new highs.  This is a strong close but still will face resistance tomorrow in upper 830's.  The vix is off by almost 10 points and holding back most out of the money calls to steady levels.  Further gains will start to put pressure on our short call positions.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

CXL 10 yr

We missed the 10 year by a couple ticks.  Cancel it.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

10 yrs

There is a little day trade set up in the March 10 year note to buy it at 125'06 with a 5 point stop and a 125'16  target good for the next hour.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Wednesday Morning Futures Update

The technicals for the stock indexes are negative short term.  We are higher at the moment and this early strength may offer a good opportunity to sell calls/spreads and/or buy puts/spreads. The S&P's may top out anywhere between 814 and the upper 820's this morning and re-test or break yesterday's lows.  

That is the technical makeup as I see it, but it is important to remember that any specifics offered by the new administration as far as the stimulus or banking fix goes may prompt significant reaction in the market.  Also, the new Treasury Secretary will be grilled for confirmation today which also may create volatility.  He appears to be headed for confirmation (which the market seems to want) but if it gets off track because of his unpaid taxes or employing an illegal alien then it may cause problems.  

Notes and bonds are lower and the dollar is relatively quiet this morning. 

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Market Update

The markets are not giving our new President a very warm welcome.  Stocks have been under pressure all day with very small bounces.  The overwhelmingly negative economic enviornment seems to be trumping the optimism surrounding Obama's inauguration.  

There is renewed concern over the solvency of not just our domestic banks, but of banks globally. That, I think, is causing the pressure in stocks and the firmness in the dollar. The indexes are looking like they are picking up negative momentum.  As we approach today's buy zone, it is important at this time of day and the changes taking place to consider this level could be tomorrow's sell zone.  With the vix up 7+ to 53+ today, it is worth considering selling calls as the vix should give a substantial cushion to any reversal.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Tuesday Morning Update

Good morning.  With most attention on Washington today, anything can happen.  However, the stock indexes are weak and look like they should be sold on strength.  The dollar index continues its strength as the EC and BP are getting knocked down significantly.  For as bad as things look in the U.S., it looks worse in the UK and EC countries.  (I was reminded this weekend that the ECB raised rates last summer...they have some catching up to do with rates).

The size of the governments funding needs is finally getting a little more attention, and is seemingly putting some pressure on longer term interest rate futures.  The numbers are so big (and growing by the day) for future government borrowing (supply) it is hard to get a handle on. The impact on interest rates and foreign exchange should be huge also.  Longer term interst rate futures have developed a trading range since early December.  I continue to look for opportunities to sell these contracts.

Gold is rallying in the face of the stronger dollar but is not particularly bullish here.  Crude on the other hand is lower again.  It's last trading day for the Feb contract and March is trading around 40.50.  With the global demand picture not brightening any, we may see March quickly catch up to the Feb levels, (mid 30's).

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

SP's and Notes

The S&P's just traded down to 826.25.  It is a bit early for the intra day charts to show any buy signals but it stopped right in front of the daily buy zone number of 825.  The notes also briefly traded below their buy zone level of 125'15  ealier today and have since rallied.  Ditto for the dollar index and reverse for EC. I mention this only to remind people that the numbers each day area usually worth noting.  Often the markets trade into them and  change direction without my daytrading criteria being met.  They are particularly useful for managing option positons.  

http://www.stopsandoptions.com/buy-sell-zones-1

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Friday Morning Update

Like so many mornings, there are a lot of headlines impacting the markets.  So mcuh so that I thing the cpi data was a complete non-event.  It's expiration for January index options, we have a three day weekend, Obama's inauguration on Tuesday and more, massive bank interventions both here and over seas.  

The indexes are higher but near resistance in my view.  The Nasdaq has topped thus far at 1201 and the sp should see some resistsance in the 860's.  I think you can sell calls/call spreads in the sp in the 860's and possibly sell puts/put spreads in the 820's.  

In general, the early morning moves, higher stocks, gold, EC and lower 10 yrs and dollar index look to be fades.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

NQ and S&P

The nasdaq looks like its on its way back to 1200.  I'm looking for a spot to buy it.

I don't have a feel for the S&P's.  Too many mixed signals for today.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Stocks

The sp futures are still negative but I don't think it should be sold down here under 820 at this time of day.  Perhaps a rally above 828 could be sold later.  Nasdaq is holding on to a slightly more positve chart and traded into its buy zone earlier.  Some days (too many) it's hard to pick better intra day levels than the daily Buy/Sell levels.  Substantial moves in the earlier mentioned markets have traded as mentioned but with such high, short term volatility around the stock opening it was too difficult to post levels.  

Still lots of time for something today...

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Morning Market Update

Stocks, gold and the EC  look like sales on strength while the dollar index is pushing higher.

We just had several economic releases none of which were particularly good for the economic outlook except an unexpected decline in continuing unemployment claims dropped instead of an expected increase.  Nonetheless, the data was not good and we have more to come later and tomorrow. 

The ECB cut their target lending rate to 2% as was expected.  The EC reached 1.3212 overnight but has since traded under 1.31.  We'll look to sell it again today.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Cancel the EC

The EC rallied back to 1.3164 so we missed the re-entry and now it's too late for a short term trade.  I feel the Dollar index can continue higher and the EC can move lower.  I can't tighten up the stops any from the Daily Buy/Sell levels for an overnight position.  We will most likely look to sell EC again tomorrow and/ buy the dollar index.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

EC

We were stopped out at break even in the EC but we can offer it out  again at 1.3170 with another 25 point stop for the next hour.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

EC Stop

Move stop on EC to break even.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

SP's

The stock index charts are very mixed.  I want to clarify my view as I am a reluctant bear short term in the face of longer term support.  There is a weekly signal to buy in the low 830's and risk about 40 points for a move back to 915.  On top of that we are in a daily buy zone.  This is countered with all the intraday stuff that is really showing no sign of a bottom of yet and the possibility of the daily chart becoming more negative without a bounce.  

I like selling the EC as noted earlier. 

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

EC

I think there is a day trade here in the EC.  Sell the March EC at 1.3150 and risk 25 ticks.  Initial target is 1.3100.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Stock Indexes

Stocks are into their daily buy zone but there is no sign of short term relief from the selling.  This can continue to feed on itself and turn quite negative with a close down here, 840ish or below.  I'm looking for some near term rallies to sell.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

EC Daily Buy/Sell

There was an error on the EC daily buy/sell page this morning but it has been corrected.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Morning Update

This morning we've had a pair of weak economic numbers,  continued dismal mortgage purchase application data as well as weaker than expected retail sales for December.  Stock indexes were soft before the numbes and more soft afterwards.  There should be support in the sp's around 840 and near term resistance in the mid 860's.

The dollar looks like it can build on yesterday's strength.  Gold held up well yesterday in the face of the dollars rally but I don't see both rallying together for any sustained period.  

The 10 yrs are up but I don't expect to sell them today as the daily numbers will shift higher if the early gains are maintained. 

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Update

Stocks continue to struggle and don't look particulary bullish.  However, a modest rally can change the charts quickly. 

The dollar and crude had all the volatility today.  The dollar index was very neutral coming into today but now looks like it can continue higher.  Crude was very choppy today as it seems to be developing some short term support.  

I've been working on the website, www.stopsandoptions.com, and will add more info to it shortly.  Take a look when you can.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

10 yr notes

The notes traded back through our stop at 126'04.  It's tough to get this to break much but it did trade as low as 125'24.  As firm as it has been, it is still technically set up for another sale around our our original stop level of 126'14.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Canadian Dollar

The Canadian rallied through our initial target already so we missed the original idea by a tick.  Cancel the order underneath and we'll look for another trade.

Notes just made new lows for the day, 125'26.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Canadian Dollar

We just missed the last dip in Canadian.  But since we did we should now lower the bid to 8110 and keep a 20 point stop.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Note Stop

Move stop on Ten year notes t0 126'04.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Canadian Dollar

Buy the march Canadian Dollar at 8115 with a 20 point stop.  The initial target would be 8155 but we would most likely trail a stop at that point and look for a bigger move.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Notes and Trade data

The ten year notes topped out yesterday at 126'11.5 and overnight at 126'11, so we squeaked through with our short position from 126'02.  The market just made lows of 125'27.5 after the release of November trade data which was better than expected.  We want to move the stop down to break even on further weakness.

SP's have had a choppy overnight session and are coming off recent lows after the trade data. 

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Stock Indexes

Stocks have come down to weekly support levels of 1190 in NQ and low 860's for the S&P's (similar support in the Dow futures is around 8325.  If the market were to close here the daily numbers for tomorrow would be lower, but we should see some support in the markets soon.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

NQ

The NQ recently traded through our 1201 stop level.  A failure to rebound before the close will cause the NQ to join the other indexes in a slightly more bearish position with lower buy/sell zones.  

We're still holding a short position in the ten year notes which are currently trading around 126'06.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

NQ and Notes

The NQ recently traded to 1206.25, so we're on a buy signal from 1211.  Keep stop at 1201.  

Sell notes at 126'02 with a 12 tick stop and a target of 125'00.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

NQ Buy Signal

Buy the March NQ  at 1211 with a 10 point stop and a 1233 target.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

NQ

The NQ did not shift lower along with the Dow and S&P on Friday so that complicates the stock index picture somewhat.  An early move down towards 1214 would create a buy signal.  It's currently trading around 1224.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Monday Morning Update

Good morning.  The S&P's are slightly lower after turning mildly bearish Friday from the standpoint that the Buy/Sell Zones shifted to lower levels.  Looking at both the Daily and Weekly charts suggests a move down to 865-850 before attempting any serious move back towards the recent highs.  These charts are formed within the context of a very bearish Monthly chart.  An early move to 894 would most likely be a sale this morning.

Ten year notes still are in a sell zone above 125'12 but there won't be any early sell signal until 126ish.  

The dollar index is also in a sell zone and may develop a sell signal near the overnight highs. Same trade in reverse exists with the EC, SF and BP.  I'll come back with specific levels asap for those markets.

Crude, gold and other commodities are falling significantly this morning but no trades for now.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Stocks

The stock indexes have been unable to bounce out of the early weakness.  A close in the March SP under 893.50 suggests a closing short put positons.  

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results

Stocks and Bonds

The charts tell me to buy stocks and sell bonds here.  It seems like thesee may be pivotal longer term levels, 125'16ish  in notes and 890ish in sp's.  As I'm sure most of you are aware, there is often a lot of volatility after big economic releases and today is no different.  At the risk of missing identifiable entry  levels here, I want to let the markets settle in a bit more today and further digest the data.  There is no good news in it.  It's just how the market perceives its impact on future prices.

There is a substantial risk of loss in trading commodity futures, options and foreign exchange products. Past performance is not indicative of future results