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Hi Stig,
The 14-day ADX chart is currently at 14, and waiting to cross above the 15 level line. In English, it means a wakeup call for a trading range market such as Sugar! On the weekly chart, I can see a possible resistance level at 12.85.
Arnold(one of the RT'ers) also mentioned that commercials are 2 to 1 short in this market. I thought this might be an interesting info.
Thanks for shedding light on this market!
Happy trading,
Frank
-----Original Message-----
From: Stig Olausson [SMTP:olausson@xxxxxxxxxxxxx]
Sent: Thursday, October 30, 1997 8:33 PM
To: RealTraders Discussion Group
Subject: Sv: MARCH Sugar
This is a reply to Frank, but after I sent it I come to think that perhaps
someone else also was interested....
Stig
>
> > Today was certainly an upside breakout above the resistance level 11.91
> to close at 12. Both weekly, and daily trend are up and rising. I'm long
in
> this market with a protective sell-stop at 11.80. Can't see any overhead
> resistance! Is this market staging for a strong rally?
> > Any comments are greatly appreciated.
>
>
> Frank,
>
> This is a post I got from Douglas after my initial post on March sugar (I
> hope you don't mind me posting it to RT Douglas)
>
> > You got me back into the books, Stig, and one of the things I ran
across
> > was in a book called "All About Futures" by Thomas A. McCafferty &
> > Russell R. Wasendorf in a seasonal & pricing tendency overview of
> > several markets, one of which was sugar...
> >
> > "Sugar pricing has an unusual pricing history. Many analysts liken it
> > to the 'tulipomania' that occurred in 17th century Holland."
> >
> > It goes on to speak of the 1974 bull market where prices increased 8
> > fold over the '73 level. Then it came down faster than it went up from
> > 65 back down to 15-20 cent range. In 1980, sugar rallied to 45 cents.
> >
> > The synopsis ends with this caveat, "The point is simply this: sugar
has
> > a propensity to move way beyond what could be expected based on
> > fundamentals. It can be a very emotionally driven market. Keep that
in
> > mind."
>
> Well, before I read it, I had decided to keep on the side lines, but
after
> these lines I decided to keep my eyes open.
> But when SUH broke 12.00 yesterday (the neckline of the continuation
> inverted H&S I talket about in my initial post), I couldn't resist. (I am
a
> firm believer in H&S patterns) I entered 20 minutes after opening today
(on
> a market order) at 12.07. This was also because I read $upertrader's
> almanac again and found that SU has a 10year seasonal tendency to rise
from
> early October - end Dec. at the end of the book Frank Taucher also have a
> segment he calls "Best Bets" (p362) where you can read:"This
market(sugar)
> built a huge base over the last 16 years. If the interpretation is
correct,
> prices are preparing for an explosive upside move".
>
> It is not a very detailed chart, but the way I see it we have broken out
> upside from a major resistance line startin at around 16,25.(!) we tested
> the line it on Sep 25 at 11.26 and we are now starting a major move up.
> Like Frank, I don't see any immediate overhead resistance either.
>
> Please look at the volume on this break out. This is serious stuff!
> The power of this break makes me think that we will not have a pullback
(I
> ALWAYS think like that!!!), so I wouldn't hesitate to enter now. But
> anybody with a better sense could probably get a fill around 12.10 on a
> pullback, for a nice ride to a MINIMUM of 12.94( the potential in the H&S
> pattern), but if we should believe the content of the above quote from
the
> book above there is more to come.
>
> They way I see it is that we have now tested the downnside and it didn't
> work - and since sugar evidently isn't going sideways(see above), the
only
> way is UP.
>
> Best regards
>
> stig
>
>
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