How It’s Done!
Every once in a while I see some lost souls in the comment section who just may benefit from a friendly reminder as to why I bother to post technical setups here in the first place. Dont’ get me wrong I’m all for becoming a self sufficient trader but let’s just hypothetically imagine for a moment that what you’ve been doing in the past few months or even years hasn’t been working very well for you.
As human beings we are all creatures of habits and change requires not just realization but also effort. As the saying goes: The definition of insanity is doing the same thing over and over again whilst expecting different results. And in particular when it comes to trading the markets – in the end only results count. So let’s see what does work for us – not in theory in some fancy trading book, but right here today!
Cotton was touching ST support this morning and I expected the hourly NLSL to put up some of that. Below we also had the looming 25-hour SMA but cotton didn’t even look back and instead decided to make a b-line for the upside. I would strongly recommend taking profits here as we don’t want to overstay our welcome.
By the way this chart right here goes to show why you never ever want to go short solely based on the fact that a symbol is ‘overbought’. Shortqueeze.com exists for a reason and this counts double for trading forex and/or commodities.
Bonds – the 30-year did what I actually hoped it would do – breach both SMAs and push higher. Now that was a great entry but we now face a decision. Take profits here or stay in the trade as we are butting against the 25-day SMA. I would be out here and re-enter if we get a solid breach above. Alternatively you can take partial profits, put a stop a bit below and then keep adding positions again after a breach.
Sugar turned out to be another sweet trade today (pun intended). Great entry near the NLBL and at the 25-hour SMA. I strongly recommend taking profits now.
Copper – great entry as well near the SMA and it’s doing well thus far. Once again we are faced with a decision as we just pushed through a daily NLBL. I personally am holding with a stop below the NLBL as I like the setup and there’s quite a bit of support below right now. So it’s worth the risk of giving up my existing profits in my book. You can of course take partial profits – all up to your risk exposure rules.
The Dollar didn’t really go anywhere yet – I’m holding my short until I (hopefully) see a reason to flip it for a long.
Last but not least there’s the CAD/JPY which gave us some tingles earlier today but it seems to be holding the line. I think it’s worth holding for a possible pop higher – we do have a possible floor pattern and unless we breach 89 we ought to be in good shape.
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