TRADE Focus

09/03/2009

We invite you to call and ask about any of these market situations we have discussed or to ask about our considerations for the best trade opportunities for the day or for the week. We also welcome any comment on our weekly commentary as well. We believe, through our years of experience, that what we offer is of value. We are confident enough, in fact, to say to you to tell your friends, relatives and neighbors about us too. Please feel free to contact us at 1 800 321-5810 or email to cbands@cbandsbrokerage.com

The Trade Focus commentary was written on Wednesday, September 2nd and the market analysis section was written during the course of business on Thursday, September 3rd.

We don't know about the rest of you but we seemed to witness and experience more than our share of emotion ridden trading this week. Perhaps the biggest 4-day drop in months brought out this awful demon. This is a demon to market traders, make no mistake. When getting knots tied in the stomach, and far worse, in the head, trading decisions fight a very difficult battle. It's hard to keep emotion charged energy out of the process. And when money is on the line it easily becomes a very negative charged energy force. Trading participants can become angry and disgruntled under these circumstances and can be led to making decisions that more than just stray from their trading plan.

A big contributor or culprit to this can be a trading screen itself where everything the trader sees is either "RED" for down or "GREEN" for up. We see it and feel it ourselves too. And the net changes from the previous day's close may be slight but those colors can connote something much bigger than what is really happening. Now the trader gets thoughts that "oh my God, if I don't pull the trigger now I will miss the move!" We know this to be incorrect thinking but it happens.

So the big question is how to avoid this? Last week we talked about the importance of emotional and psychological conditioning. Training of this nature can go a long way toward helping alleviate the problem. Reducing market movement to a black and white logical progression and being able to accept the gyrations of the market whether pro or con can have a very positive effect on the trading psyche, the decision making process and hopefully the trading results. These are huge benefits.

Another way to help avoid getting all twisted up inside with the movement of the markets is that once the whole approach can be reduced to a black and white, if this then that progression, the necessary orders can be placed and the screen can be turned off. This may be difficult and may be unrealistic depending on some trading approaches, but the idea is that the less the screen is watched the less it can have negative effects on decision making abilities. The key is to not allow market "noise" to cause jumping the gun on entering and exiting market positions which often result in buying resistance and selling support. That is most usually a losing proposition.

Note: We are archiving the Traders Focus from here on so that those interested can follow more easily.

SUGAR (OCT) - Sugar may be poised for a correction of some consequence if not having placed its top. Tomorrow's close will be important as to whether it signals a weekly reversal. For now we believe that the more aggressive well margined trader can initiate short positions at a price level of 2350 or above with suggested stop protection of intraday penetration of 2490. The retracement resistance levels based on the monthly data are approx.: 1889 (hit); 2402 (hit); 2915. The next series above is approx.: 2663; 3414; 4166.

Silver (Sept/DEC) - Silver exploded to the upside breaking out of significant resistance. Our pattern interpretations turned out decidedly incorrect. The move off the July low, however, has been what appears to us an a-b-c upswing where with today's high the c has equaled the length of a. This frequently is a target of such patterns. This also puts the price up against the early June high which happened to be a .618 retracement of the March 2007 high to October 2008 low.

Gold (Oct) - The previously active suggested short entry from a price level of 95940 would have seen its corresponding stop protection elected with the intraday penetration of 96310. We withdraw any other suggested entries from the October contract at this time as it allows us the opportunity to roll our coverage to the December contract. As in the Silver market Gold forged a major breakout to the upside where it has approached the $1,000 per ounce level. We believe it necessary to wait and see what will unfold from here.

Euro Currency (Sept) - There have been 2 suggested short entries active. One from a price level of 14350 and the other initiated in a sell zone between 14265 and 14310. The suggested stop protection has been intraday penetration of 14461. There remains a short entry approach with a close below 14064 which has not been elected and we believe can be amended to a close below 14145. The suggested stop protection for this short entry approach should be intraday penetration of 14333. We will be updating retracement levels when the market moves out of its recent range. Also, we will be rolling coverage to the December contract with the next edition.

Japanese Yen (Sept) - The suggested short entry from the price level of 10625 or above would have seen the suggested stop protection elected with intraday penetration of 10772. We will roll coverage to the December contract beginning next week.

Mexican Peso (Sept) - We will be rolling coverage to the December contract in next week's edition. It appears there may be a move higher off this week's low and believe additional pattern development will help clarify.

British Pound (Sept) - There are two active suggested short entries. One from a price level of 16800 or above triggered back on August 7 and one short entry from the August 17 close of 16338. We believe stop protection for both suggested short entries can be moved to a close at or above 16460. Retracement levels of support are approx.: 16057; 15749; 15442. We will be rolling coverage to the December contract next week.

Canadian dollar (Sept) - We roll our coverage for the Canadian Dollar contract to the December contract with this edition. Any active suggested entries for September are no longer valid. We believe short entries can be initiated in the December contract with a close at or below 8980. If initiated we believe stop protection is appropriate with intraday penetration of 9120. Retracement levels of support are approx. 8977 and 8877. The next series below is approx.: 8766; 8567; 8369.

S&P 500 (Sept emini) - The recent long entry position from the August 21 close of 102525 would have seen stop protection elected with the 99650 close of September 1. We believe short entries can be initiated with a close at or below 97425. If elected the suggested stop protection should be a close at or above 100125. Retracement levels of support are approx.: 97300; 95250; 93200.

Feeder Cattle (OCT) - There is an active suggested short entry from the price level of 10250. We believe stop protection can be lowered to intraday penetration of 10155 or a close at or above 10090. Retracement levels of resistance are approx.: 9980; 10077; 10175.

Soybeans (Nov) - we remain sidelined

Wheat (Sept) - We begin rolling coverage to the December contract with this edition. Any outstanding suggested entries for the September contract are no longer valid. We will wait for additional development now in the December as this contract continues to erode.

T-Bonds (Sept) - Last week we rolled an active suggested long entry in the September contract from its penetration of 119-10 to the December contract with price basis levels of 120-12 for September and 119-05 for December. During the week since we last wrote an additional or new long entry could have been initiated with the intraday penetration of 120-02. We believe stop protection for both suggested long entries can be a close at or below 117-29. Retracement levels of support are approx.: 118-11.5; 117-14; 116-16.5.

Ten Year Notes (Sept) - Last week we rolled an existing suggested long entry in the September contract from the Aug. 17 close of 117-24 to the December contract with prices of 117-27.5 116-16.5 respectively. We believe stop protection for the December contract can be raised to a close at or below 115-30. Retracement levels of support are approx.: 116-09; 115-22; 115-03. There is a retracement resistance level of approx. 118-28.5.

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