Week of June 5, 2009

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CHARTSMITH Weekly Market Update

Greetings fellow traders!

Welcome to the "paper trading" market update for the week of June 5th, 2009.

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What an extraordinary week!! June 1st marked the beginning of Hurricane Season (more on that later), Jim Rogers was interviewed on CNBC (we've included access to this fantastic video below), and a lot of exciting events are taking shape in the markets for us to look at together so let's get started!...

New to the ChartSmith Watchlist this week is Natural Gas! We'll keep a lookout on the July 09 contract for a trade setup as this is the current front month.

To view a chart go to: http://futures.tradingcharts.com/chart.php?cbase=NG&market=NG&cterm=79

Cotton
We're still monitoring cotton for a retracement into the wholesale zone--stay tuned…

To view the daily chart go to: http://futures.tradingcharts.com/chart.php?cbase=CT&market=CT&cterm=79

Eurodollar
The Eurodollar market closed out the week at 99.302 basis points. Keep watching for a short side entry to develop. For more information on this market development see the recently released article, EURODOLLARS—the Perfect Storm?.

To view the chart go to: http://futures.tradingcharts.com/chart.php?cbase=ED&market=ED&cterm=69

Gasoline

This week's trading saw gasoline moving closer to the $2.00 per gallon range. Our price target is $2.39/gallon (12 month 50% value).
Click here to view the recently released article; Special Report: GASOLINE

»Profits to date at this week’s close of $1.9378/gallon equals +$11,247.60/contract

This trade is progressing and trailing stops placed under recent support should be considered. The support areas you choose should be based on your individual risk tolerance.

To view the chart go to: http://futures.tradingcharts.com/chart/RB_/99

Lumber

The front month futures contract (September 09) traded up this week with a Friday closing at $221.10 per 1,000BdFt.

The May 29th buy signal in September lumber has kicked off a profitable trade this week with profits to date of + $1,760.00 per contract.

It's great to see this trade moving in our direction so quickly, however, I want to mention a bit of caution here and some of you may have already caught this on the charts. On the weekly chart the long term downtrend line has not been broken. It's getting close and when it does break to the upside this will represent additional buying strength, but for now just be aware of this. One more notable is the seasonality; the well known "in by Halloween, out by Valentines" seasonal play is not in our favor on this trade's timing. Refer back to the Seasonal Patterns section of ChartSmith-Forging Your Financial Future for more information on seasonal confirmation.

Keep your stops just below major support points on the chart. The support area you choose should be based on your individual risk tolerance.

To view the chart go to: http://futures.tradingcharts.com/chart.php?cbase=LU&market=LB&cterm=99

Orange Juice

The Orange Juice market finish out the week at 93.45 cents/lb.

Our original entry point is 92.75¢/lb.

»Profits to date + $105.00/contract

An ascending channel has developed and prices have traded to the bottom trend line. Keep your stops just below major support points on the chart. The support area you choose should be based on your individual risk tolerance.
To view the chart go to: http://futures.tradingcharts.com/chart.php?cbase=OJ&market=OJ&cterm=99

“Invest in the commodities you use every day.”

ChartSmith monitors markets in the Low (wholesale) Zone for the Buy Low—Sell High profit opportunity and the High (retail) Zone for the Sell High—Buy Low profit opportunity; Cotton, Gasoline, Lumber, and Orange Juice have been on our watchlist for paper trading the low zone this past month and the recent addition of the Eurodollar is being monitored in the high zone. New to our watchlist this week is Natural Gas.

Complete details for these and other exciting low risk, high profit trade setups are included in the book, ChartSmith--Forging Your Financial Future.

B(re)aking News Flash!

The 2009 Atlantic hurricane season has officially started. The period each year when most tropical cyclones form in the Atlantic basin extends from June 1st to November 30th. However, for the third straight year, the season started early when Tropical Depression One formed on May 28. For more information go to www.nhc.noaa.gov

Shawna's recipe for Hurricane Cake
1/2 cup butter
1 cup chopped pecans
1 cup flaked coconut
1 pkg German Chocolate cake mix
1 8oz. cream cheese
3 3/4 cup confectioner's sugar

Preheat oven to 350 degrees F. Melt and spreade 1/2 cup butter in bottom of 9x3 inch pan. Sprinkle bottom of pan evenly with coconut and pecans; set aside.

Prepare cake mix per directions on box. Pour batter in prepared pan. In saucepan melt cream cheese and 1/2 cup butter over low heat. Stir in confectioner's sugar until smooth. Randomly spoon mixture over top of cake batter.

Bake 35 to 45 minutes or until toothpick inserted in middle comes out clean. Refridgerate leftovers.

Dollar Crisis Looming — Don't Short the Market: Jim Rogers
Click here to view the CNBC video!

Quote of the Week

Don't miss a blessing just because it came in a package you didn't expect. ~anonymous

Thanks for joining us for this week's paper trading market update. As always, we appreciate hearing your thoughts and ideas, and your trading successes and learnings. Please feel free to email us anytime at scott@mychartsmith.com or mychartsmith@gmail.com.

To your abundant success!

Scott and the ChartSmith Team

ChartSmith-Forging Your Financial Future

P.O. Box 1209 Clarkdale, AZ 86324 928.254.0077

Please read our IMPORTANT NOTICE: Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. Nothing in our commodity futures workshops, website, or newsletter shall be deemed a solicitation or an offer to Buy/Sell futures and/or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed during the workshops or on our site. Also, the past performance of any trading methodology is not necessarily indicative of future results.

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