Thursday’s Futures Setups
Crude supplies were up 3.1
billion barrels last week, while unleaded supplies were up 2.7
million barrels. Housing starts in August were down 4% from July’s pace and up
5.1% from a year ago. Rains from hurricane Isabel are expected to begin tonight.
Coffee got whacked the past few days but may be showing some signs of a reaction.
Cocoa may be showing some signs of life as well.
Hurricane Isabel is getting closer to land, but seems to be diminishing in power
— down to a category two. Still, folks have been buying plywood in preparation
and the general hysteria is definitely present. Rains are expected to
begin tonight, so watch for a “buy on the rumor, sell on the news” scenario.
Please note that while there are strong trends, one bar or a series of bars
forming a setup can sometimes indicate a contra move for the next day. This
contra move may not be long-lasting — maybe only for a day or two. Trading with
the main trend is always the highest probability trade.
Be advised that some futures contracts are prone to gaps.
Remember, use stops on all your trades.