For the Week of July 11, 2016
This weekly feature examines chart formations, along with technical indicators, of two to three commodity markets. Breakouts of these formations may lead to trading recommendations published by the Trade Spotlight advisory service.
Highlighting This Week’s Potential Breakouts:
U.S. Dollar Index
There is a potential Momentum Entry Technique (M.E.T.) trade setup in the September 2016 U.S. Dollar Index contract. An M.E.T. trade occurs on a break out of a recent pivot point high or low with the corresponding trend in the same direction. The Trend Seeker (a U.S. Chart Company tool to help identify a market’s trend) is Up. The MACD, a trend indicator, is bullish above the baseline, however there is divergence. The Stochastic indicator, a momentum indicator, is bullish as well, though perhaps over bought. A 20-day Moving Average crossed a 50-day Moving Average, a bullish signal A break of the 96.865 (6/27/16) high triggers an entry to the upside. A stop loss could be placed below the pivot point of 95.375 (7/05/16). Upside targets are the 98.500 level and the 100.000 level, potential resistance levels.
Soybeans
There is a potential Momentum Entry Technique (M.E.T.) trade setup in the November 2016 Soybeans contract. An M.E.T. trade occurs on a break out of a recent pivot point high or low with the corresponding trend in the same direction. The Trend Seeker (a U.S. Chart Company tool to help identify a market’s trend) is currently Neutral. For short entry confirmation the Trend Seeker must change to a Down trend. The MACD, a trend indicator, is bearish above the baseline. The Stochastic indicator, a momentum indicator, is bearish as well. A 20-day Moving Average has hooked towards the 50-day Moving Average, a bearish signal on a cross over. A break of the 1021’0 (7/08/16) low, or even the 1018’6 (5/24/16) low, triggers an entry to the downside with the other criteria in place. A stop loss could be placed above the 50-day Moving Average (1080’0) and recent contract highs. The downside target is the 900’0, a level of potential support and near where prices were trading last year this time and into the later summer months.
Risk Disclosure
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.
