For the Week of December 01, 2014
The Trade Spotlight advisory service applies the GBE trading methodology (buying or selling commodity contracts based on breakouts of chart formations and technical indicators) to identify one to two trade setups per week.
Highlighting This Week’s Potential Breakouts:
Canadian Dollar
There is a long entry opportunity in the December 2014 Canadian Dollar contract (LTD is December 16, 2014) on a breakout of a Trend Line Formation. The Trend Line is made up of highs at .9218 (9/04/14), .9167 (9/19/14), and .8931 (11/21/14). If the contract closes above the Trend Line (approximately .8900) this in part triggers a long entry signal. The Trend Seeker (a U.S. Chart Company tool to help identify market trend) must be in an uptrend as well for trade confirmation, it’s currently down. The MACD, a trend indicator, is up. Stochastics, a momentum indicator, is quite volatile currently. This is due to a large sell-off during Friday’s trading session; followed by a strong rally today. A 20-Day Exponential Moving Average and 50-Day Simple Moving Average are narrowing. A cross over of these two averages is another bullish signal and additional confirmation. A couple upside targets are the highs of .9131 (9/18/14) and .9226 (8/29/14). Splitting the difference and placing a target at 92 even is reasonable.
Corn
The March 2015 Corn contract is trading along a lower Trend Line which is acting as strong support for this market. There are touches at 330’4 (10/01/14), 332’0 (10/02/14), 333’6 (10/03/14), 375’6 (11/19/14), 375’2 (11/20/14), 378’2 (11/24/14), 379’0 (11/25/14), and 383’0 (12/01/14). Any stop loss orders to protect long positions can go below this trend line. A break of the 401’2 high (11/13/14) triggers a long entry. The Trend Seeker (a U.S. Chart Company tool to help identify a market’s trend) is already up and with a strong ranking. The MACD indicator is bullish, but relatively flat. Momentum, is stronger as the Stochastic indicator is bullish. A 20-day Exponential Moving Average is flat as well, as the contract has been trading within a narrow range recently. A 50-day Simple Moving Average is pointed up. An upside target is a series of lows around the 450 price level.
Risk Disclosure
STOP ORDERS DO NOT NECESSARILY LIMIT YOUR LOSS TO THE STOP PRICE BECAUSE STOP ORDERS, IF THE PRICE IS HIT, BECOME MARKET ORDERS AND, DEPENDING ON MARKET CONDITIONS, THE ACTUAL FILL PRICE CAN BE DIFFERENT FROM THE STOP PRICE. IF A MARKET REACHED ITS DAILY PRICE FLUCTUATION LIMIT, A "LIMIT MOVE", IT MAY BE IMPOSSIBLE TO EXECUTE A STOP LOSS ORDER.
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