June 19, 2009

Building Wealth Through Commodity Futures Trading

June 19, 2009

CHARTSMITH Market Update

Greetings fellow traders!

Welcome to the "paper trading" market update for June 19th, 2009.

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The markets were rockin' & rollin' with volatility this week. This is known to happen in the commodity markets--one moment they're trending along nice and smooth and then without a moments notice the markets can turn choppy. Geo-political issues affecting supply & demand, too much weather or not enough weather, supply disruptions, fear, greed, and the list goes on...and for all these reasons this is why as traders it's imperative that we always have a specific plan before putting on a trade.

Let's jump in and take a look at the market action...

Cotton
Cotton made a break to lower levels this week closing below recent support on Friday--keep watching for a paper trading entry to the longside to setup.

We've switched from watching the July contract to the December contract as this has now become the future delivery month with the most Open Interest.

To view the daily chart go to: http://futures.tradingcharts.com/chart/CT/C9

Eurodollar
Eurodollar's on the GLOBEX closed out the week at 99.215 basis points.

The front month, based on Open Interest, is now the September futures contract. Keep watching for a short side entry to develop.

For more information on this market development see, EURODOLLARS—the Perfect Storm?.

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

Gasoline

This Friday's trading session touched off trailing stops in the August Gasoline futures contract at $1.9480. Accumulated profits were closed out at +$11,676.00 per contract.

Note: our price target of $2.39/gallon was not reached before the market hit our trailing stops. But a profit is a profit so we'll return to the sidelines for now and wait for another trade setup to present itself.

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

Lumber

The September 09 futures contract traded up this week with a Friday closing at $233.00 per 1,000BdFt.

Profits to date: + $3,069.00 per contract.

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/LU/99

Natural Gas
A potential buy signal is shaping up in Natural Gas. Open Interest is greatest in the August delivery month so we'll drop the July contract for the August on our watchlist.

This week the MACD lines moved above the zero pivot point--keep watching...

To view the chart go to: http://futures.tradingcharts.com/chart/NG_/89

Orange Juice
Orange Juice has found support at the 80 cent level on the chart for now. A bear flag has taken shape as well; if the bears get their way we could see OJ fall to the next support areas at 75.95 and 72.70 moving deeper into wholesale levels. Keep watching...

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

Quote of the Week

You got to be careful if you don't know where you're going, because you might not get there. ~Yogi Berra

We have some exciting news to share with you before we wrap up this week's update. Recently a webpage was added to the ChartSmith site for instant snapshots of global and national news & weather updates, including a direct link to NOAA for hurricane information. The webpage is called Commodity Related News & Weather and can be located on the site menu as News & Weather.

Thanks for joining us for this 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.

Enjoy your weekend!

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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