Today we have provided the following steps as guides to progress, and are not necessarily in sequential order. Some of them are always required, but each futures trader is different and will relate to these stages in their own ways. While attempting to learn and progress, one must keep in mind that futures trading is risky and can involve significant losses.
Read a small portion of the article here:
Hopefully if you are already trading you have completed your initial education: contract specs, trading hours, futures brokers, platforms, the opportunities as well as the risk and need to use risk capital in futures, and so on. Understanding this information is essential to futures trading. The second type of education is ongoing: learning about trading techniques, the evolution of futures markets, different trading tools, and more.
2. Find a System
I am definitely not advising you to go on the web and subscribe to a "black box" system (using buy/sell triggers if don't know why they are being generated). What I am advising is developing a trading technique: a general set of rules and a trading concept. As you progress, you may want to put the different rules and indicators into a computerized system, but the most important factor is to have a focus and a plan. Don't just wake up in the morning and trade "blank."
This is the key! Do what you need to do in order to survive this brutal business and give yourself the chance of being here down the road with more experience and a better chance of success. Survival is probably the biggest key for beginning traders. There is a saying in this business: "live to trade another day." It is so true!
Want to see the rest? Click here and fill out the form at the top of the page to download and read our full guide which outlines some important futures day trading concepts.
2. Jim Wyckoff's Hot Market - Commodity Bulls Enjoy General Sector UptrendThe Continuous Commodity Index (CCI) is a basket of 17 major raw commodity futures prices rolled into one composite price index. It's an excellent gauge of the overall price trend in the raw commodity sector and of the general trend in commodity price inflation. See on the daily CCI chart that prices are in a 2.5-month-old uptrend. The year 2012 has been generally good to the commodity market bulls, so far. As long as the daily CCI chart continues to trend higher, most commodity market bulls are likely going to enjoy successes.
We’ll examine the significance of that move and report on the alliance between General Motors and Peugeot Citroen as they try to tackle the problems of Europe’s car market.
Also, we say hola to the phone folk as the Mobile World Congress in Barcelona kicks off.
|Issue Date: January 20, 2012|
This Week's Futures Commentary:
There's A Stranger In The House; A Bearish Corn BrokerAfter being bullish corn prices for the last 18 months I've turned the corner and am now bearish. The comments around the office have been interesting. Adjectives such as stranger and traitor have been accompanied with "who are you" and "how could you?" I've started establishing bearish corn positions for my clients.
First off, the USDA surprised everyone with a larger than expected quarterly grain stocks report. These reports are beginning to show a theme, corn used for feed is steadily declining. This trend should not be taken lightly, in my opinion. Indeed, as a livestock analyst, I can nearly guarantee that livestock numbers in the U.S. will decline substantially during 2012. Major declines in livestock numbers are expected in the beef and poultry industries. In addition, DDG's and wheat will continue to be substituted aggressively in U.S. livestock rations.
By Dennis Smith
Euro Currency At 1.2000?Last week's selling in the euro currency, due to increasing worries that the euro zone economy will continue to weaken, took prices to more than a 16-month low against the U.S. dollar. Pressure on the euro resulted after the Federal Statistics Office said Germany's economy probably contracted in the fourth quarter by .25% from the third quarter, while the European Union reduced their euro zone growth estimate to .1% in the third quarter from the .2% growth they had previously estimated. In addition, a Bloomberg survey showed the euro zone economy will probably shrink by .2% this year.
By Alan Bush
Jan 20 2012
Barchart.com Morning Call for Friday, January 20, 2012
- Global stocks this morning are mixed with the Euro Stoxx 50 down -0.41% and Mar S&Ps down -1.70 points. The dollar is higher and most commodities are lower as Greek officials and private creditors meeting for a third day struggle to reach agreement on a debt swap plan. Google plunged 8.0% in pre-market trading and is another negative factor pressuring stock prices after Google's Q4 profit of $9.50 a share was well below analysts' estimates of $10.50. Limiting losses in stocks is the decline in European banks' dollar funding costs after the 3-month cross-currency basis swap, the rate banks pay to convert euro interest payments into dollars, narrowed to 76 bp below the euro interbank offered rate, the lowest in 5-1/4 months.
- Asian stocks today closed jigher with Japan up +1.47%, China +1.45%, Australia +0.59%, South Korea +2.13%, India +0.57%. A decline in European bond yields and a plunge in U.S. jobless claims to a 3-3/4 year low eased European debt crisis concerns and boosted Asian exporters, which sent Japan's Nikkei 225 Stock Index to a 2-1/2 month high and China's Shanghai Stock Index to a 5-week high. Chinese stocks were also boosted by a report from Reuters that said China's State Council is reviewing a proposal to allow local pension funds to invest 10% to 20% of their assets in stocks. Chinese markets will be closed all of next week for the Lunar New Year holiday.
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Overnight U.S. Stock News
- March S&Ps this morning are trading down -1.70 points. The US stock market on Thursday settled higher for a third day as European debt concerns receded and after weekly initial U.S. jobless claims plunged to a 3-3/4 year low: Dow Jones +0.36%, S&P 500 +0.49%, Nasdaq Composite +0.67%. The S&P 500 and the Dow posted 5-1/2 month highs, while the Nasdaq rallied to a 10-3/4 year high. Bullish factors included (1) carry-over support from a rally in European stocks on reduced debt concerns after French borrowing costs dropped at an auction and Spain sold more bonds than its planned target, (2) continued improvement on the U.S. labor front after weekly initial U.S. unemployment claims dropped more than expected to their lowest level in 3-3/4 years (-50,000 to 352,000 versus expectations of -15,000 to 384,000), and (3) signs that China may relax credit controls and boost lending after 2 people with knowledge of the matter said the PBOC will let China's largest banks increase new loans by a maximum of 5% from a year earlier, while the banking regulator will delay implementing the most stringent capital adequacy ratios and may lower risk weightings for loans to small businessmen and companies.
- Bearish factors on Thursday included (1) the bigger-than-expected decline in Dec housing starts (-4.1% to 657,000 versus expectations of -0.7% to 680,000), (2) the smaller-than-expected increase in the Jan Philadelphia Fed manufacturing index (+0.5 to 7.3 versus expectations of +3.5 to 10.3), and (3) the quarterly report from the European Commission that said the outlook for industry in the Euro-Zone has deteriorated.
- Google (GOOG) sank 8.0% in pre-market trading after the company reported Q4 profit of $9.50 a share, well below analysts' estimates of $10.50.
- International Business Machines (IBM) rose 2.0% in European trading after the company forecast earnings will increase to at least $14.85 a share this year, better than analysts' estimtes of $14.81.
- Microsoft (MSFT) climbed 2.1% in pre-market trading after the company reported Q2 profit of 78 cents a share, beating analysts' estimates of 77 cents.
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Today's Market Focus
- March 10-year T-notes this morning are down -4.5 ticks. T-note prices on Thursday dropped to a 1-week low and settled lower after weekly U.S. jobless claims plunged and on reduced safe-haven demand for Treasuries when Spain and France had successful government bond auctions and stocks rallied: TYH2 -18.0, FVH2 -6.7, EDM2 unchanged. Bearish factors included (1) the larger-than-expected fall in weekly initial U.S. unemployment claims which dropped to their lowest level in 3-3/4 years (-50,000 to 352,000 versus expectations of -15,000 to 384,000) and (2) reduced safe-haven demand for Treasuries after French borrowing costs dropped at an auction and Spain sold more bonds than its planned target, which eases concern that European nations will struggle to finance their debts. Bullish factors included (1) the bigger-than-expected decline in Dec housing starts (-4.1% to 657,000 versus expectations of -0.7% to 680,000) and (2) the smaller-than-expected increase in the Jan Philadelphia Fed manufacturing index (+0.5 to 7.3 versus expectations of +3.5 to 10.3).
- The dollar index this morning is higher with the dollar/yen +0.02 yen and the euro/dollar -0.53 cents. The dollar index on Thursday tumbled to a 2-week low and finished lower on reduced safe-haven demand after French borrowing costs dropped at an auction and Spain sold more bonds than its planned target and as the S&P 500 rallied to a 5-1/2 month high: Dollar Index -0.393, USDJPY +0.280, EURUSD +0.01050. Bearish factors included (1) strong demand for bond auctions of Spanish and French government debt, which boosts optimism the European sovereign debt crisis is being contained and reduces the safe-haven demand for the dollar and (2) ECB data that showed investors boosted holdings of euro assets by +2.4 billion euros in Nov, which indicates the European debt crisis has yet to cause widespread liquidation of euro assets. Bullish factors included (1) the plunge in weekly U.S. jobless claims to their lowest level in 3-3/4 years, which may boost economic growth and is dollar positive and (2) the quarterly report from the European Commission that said the outlook for industry in the Euro-Zone has deteriorated, which is euro negative.
- Feb crude oil prices this morning are down -62 cents a barrel and Feb gasoline is -0.30 of a cent per gallon. Crude oil and gasoline prices Thursday settled lower on weak gasoline demand and after weekly DOE gasoline supplies rose more than expected to a 10-month high: CLG12 -$0.20, RBG12 -0.96. Bearish factors included (1) the larger-than-expected increase in weekly DOE gasoline supplies to their highest level in 10 months (+3.72 million bbl to 227.5 million bbl versus expectations of +2.35 million bbl), (2) slack demand after the DOE said U.S gasoline demand for the week ended Jan 13 fell -2.2% to 8 million barrels a day, the weakest in over 10 years, and (3) the weaker than expected Dec U.S. housing starts and Jan Philadelphia Fed manufacturing activity, which indicates reduced energy demand. Bullish factors included (1) the slide in the dollar index to a 2-week low, (2) the unexpected decline in weekly DOE crude supplies (-3.44 million bbl versus expectations of a +3.0 million bbl build), and (3) signs of strength in the labor market that may boost economic confidence and fuel demand after weekly initial U.S. unemployment claims fell to a 3-3/4 year low.
Earnings reports (confirmed releases, sorted by mkt cap): GE-General Electric (BEST earnings consensus $0.38), SLB-Schlumberger Ltd. (1.09), ED-Consolidated Edison (0.72), PH-Parker Hannifin (1.63), FITB-Fifth Third Bancorp (0.35), STI-SunTrust Banks (0.27), CMA-Comerica (0.51), FHN-First Horizon National (0.14), PB-Prosperity Bancshares (0.76), WABC-Westamerica Bancorporation (0.79), HTLD-Heartland Express (0.18), VIVO-Meridian Bioscience (0.19), RBCAA-Republic Bancorp (0.22).
Global Financial Calendar
|1000 ET||Dec existing home sales expected +5.2% to 4.65 million, Nov +4.0% to 4.42 million.|
|0000 ET||Revised Nov Japan coincident index CI, previous 90.3. Revised Nov leading index CI, previous 92.9.|
|0200 ET||Dec German producer prices expected +0.1% m/m and +4.6% y/y, Nov +0.1% m/m and +5.2% y/y.|
|0430 ET||Dec U.K. retail sales ex-auto fuel expected +0.7% m/m and +1.7% y/y, Nov -0.7% m/m and +0.5% y/y.|
|0430 ET||Dec U.K. retail sales with auto fuel expected +0.6% m/m and +2.4% y/y, Nov -0.4% m/m and +0.7% y/y.|
|0700 ET||Dec Canada CPI expected -0.1% m/m and +2.8% y/y, Nov +0.1% m/m and +2.9% y/y.|
|0700 ET||Dec Bank of Canada core CPI expected -0.3% m/m and +2.2% y/y, Nov +0.1% m/m and +2.1% y/y.|
|0830 ET||Nov Canada wholesale sales, Oct +0.9% m/m.|
|Morning Quotes (ET)||Last||Chg||%chg||Updated|
|US Stock Futures|
|S&P (Globex) (H2)||1308.70||-1.70||-0.13%||7:11:12 AM|
|DJIA (CBOT) (H2)||12580||-7||-0.06%||7:10:04 AM|
|Europe DJ Stoxx 50||2448.98||-10.20||-0.41%||7:06:00 AM|
|London UK FTSE Index||5737.56||-3.59||-0.06%||7:06:14 AM|
|German Dax Index||6411.95||-4.31||-0.07%||7:06:14 AM|
|French CAC 40 Index||3310.99||-17.95||-0.54%||7:06:00 AM|
|Japan Nikkei Index||8766||127||1.47%||1:28:01 AM|
|Hong Kong Hang Seng||20110||167||0.84%||3:01:30 AM|
|China CSI 300 Index||2504||36||1.45%||2:01:39 AM|
|Taiwan TAIEX Index||7234||0||0.00%||1/18/2012|
|Australian S&P 200||4239.63||24.86||0.59%||12:19:59 AM|
|Singapore Str. Times||2849.38||38.18||1.36%||4:10:01 AM|
|South Korea KOSPI 200||256.61||5.34||2.13%||4:05:21 AM|
|Bombay Sensex 30||16739||95.27||0.57%||7:21:12 AM|
|Karachi KSE-100||11775||259||2.25%||7:01:14 AM|
|US Interest Rates|
|10yr T-notes (CBT)(H2)||130.180||-0.045||-0.11%||7:11:14 AM|
|Cash 10yr T-note Price||100.020||-0.045||-0.14%||7:21:09 AM|
|Cash 10yr T-note Yield||1.993||0.016||0.80%||7:21:09 AM|
|5yr T-note (CBT)(H2)||123.080||-0.015||-0.04%||7:11:14 AM|
|Cash 5yr T-note Price||100.020||-0.010||-0.03%||7:20:55 AM|
|Cash 5yr T-note Yield||0.864||0.006||0.75%||7:20:55 AM|
|30-yr T-bond (CBT)(H2)||142.15||-0.110||-0.24%||7:11:14 AM|
|Cash 30yr T-bond Price||101.085||-0.115||-0.35%||7:21:03 AM|
|Cash 30yr T-bond Yield||3.060||0.018||0.60%||7:21:03 AM|
|Eurodollars (CME)(H2)||99.495||0.000||0.00%||7:09:32 AM|
|Eurodollars (CME)(M2)||99.475||0.010||0.01%||7:10:08 AM|
|Asian & European Rates|
|10-yr JGBs (TSE) (H2)||142.38||-0.18||-0.13%||1:02:00 AM|
|Bunds (Eurex) (H2)||138.42||-0.54||-0.39%||7:06:06 AM|
|Euribor (Eurex) (H2)||99.04||0.00||0.00%||1/19/2012|
|UK Gilts (Liffe) (H2)||116.12||-0.21||-0.18%||7:06:07 AM|
|Short Stlg (Liffe) (H2)||98.96||0.00||0.00%||6:53:25 AM|
|U.S. Dollar Index||80.3050||0.2490||0.31%||7:11:05 AM|
|US Dollar-Japanese Yen||77.1300||0.0200||0.03%||7:21:14 AM|
|EuroFX-US Dollar||1.2915||-0.0053||-0.41%||7:21:14 AM|
|US Dollar-Swiss Franc||0.9349||0.0028||0.30%||7:21:14 AM|
|British Pound-US$||1.5475||-0.0013||-0.08%||7:21:14 AM|
|US$-Canadian Dlr||1.0133||0.0025||0.25%||7:21:14 AM|
|Yen (Globex) (H2)||1.2971||0.0005||0.04%||7:11:13 AM|
|Euro FX (Globex) (H2)||1.2920||-0.0017||-0.13%||7:11:14 AM|
|SwissFranc (Globex)(H2)||1.0705||-0.0010||-0.09%||7:11:13 AM|
|British Pound(Glbx)(H2)||1.5462||0.0002||0.01%||7:11:04 AM|
|Canadian$ (Globex)(H2)||0.9845||-0.0026||-0.26%||7:10:43 AM|
|Gold (Comex) (G2)||1646.2||-8.3||-0.50%||7:11:06 AM|
|Silver (Comex) (H2)||30.355||-0.154||-0.50%||7:10:49 AM|
|Copper (Comex) (H2)||376.3||-3.8||-0.99%||7:10:54 AM|
|Crude Oil (Nymex) (G2)||99.77||-0.62||-0.62%||7:10:27 AM|
|Gasoline (Nymex) (G2)||281.28||-0.30||-0.11%||7:04:37 AM|
|Heating Oil(Nymex) (G2)||303.46||-0.14||-0.05%||7:10:10 AM|
|Corn (CBOT) (H2)||604.25||-1.75||-0.29%||7:11:01 AM|
|Soybeans (CBOT) (H2)||1191.50||-5.50||-0.46%||7:11:08 AM|
|Wheat (CBOT) (H2)||606.00||0.25||0.04%||7:09:50 AM|
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Gold fluctuates heavily ahead of the Italian bond sale
Today Market Completly Cliosed. Open tomorrow Morning.
With the start of the session today, gold is fluctuating heavily within a narrow range ahead of the Italian bond sale, where all eyes in the market are focused on the bond auction especially after fears eased slightly yesterday when Italy was able to run a successful bond sale after the several downbeat auctions seen earlier.
Gold opened the session today at $1555.50 per ounce and recorded the highest at $1561.00 and the lowest at $1543.51, and is currently trading around $1552.03 per ounce, and is expected to act in line with the Italian bond sale, where a successful sale could support the metal to rebound, while a failure is expected to trigger more bearishness, noting that the metal trades around the critical support level of $1533.00.
Yesterday, the metal declined sharply after the European Central Bank announced that its balance sheet widened to 2.37 trillion euros after pumping more liquidity for European banks last week, where lending to the euro-zone banks climbed to 879 billion euros as the Bank mentioned in a statement released today.
Overnight deposits at the European central bank climbed to all- time record of 452 billion euros, which raised concerns and fears in the market that European Bank didn’t use the extra funds provided by the Bank, but they preferred to redeposit them in the Bank in order to benefit from the differences in yields, and in result ECB’s additional fund was not pumped into the economy, hence the liquidity issue is still existed.
The U.S. dollar index inclined sharply yesterday after the announcement, where the euro declined sharply after investors flee to the low yielding dollar in order to avert as much risk as possible, especially when this year is coming to an end soon.
The strong U.S. dollar forced more downside pressures on the metal to trade lower yesterday, and still the metal is unable to record any gains today, where thin and choppy trading are affecting the metal in the time the lack of major fundamentals from Europe led investors to wait for the Italian bond auction.
Among other precious metals, silver opened the session today in Asia at $27.05 per ounce, and recorded a high of $27.13 and a low of $26.69, and is hovering in the moment around the opening level.