Thursday’s Futures Setups
The
Dow lost 50.35
to 8229.88, the Nasdaq
fell 3.56 to 1387.45, and the S&PÂ 500 dropped 4.79Â to 869.95.
Investors searched for clues on the progress of the war, but found little. At
one point today, a rumor of a “Red Alert” sent the indices down, and
then back up shortly thereafter when the rumor was dispelled. Republican Guard
units have left Baghdad and are moving toward coalition forces in the desert,
who may see significant action tomorrow.
Long
Candidates:
Contract
|
Setup
|
Direction
|
Trigger
|
Heating Oil (HOK3) |
double bottom |
up | above Wednesday’s high |
Wheat ( WK3 | Quote | Chart | News | PowerRating) |
mini triple bottom |
up | above Wednesday’s high |
Wheat
(
WK3 |
Quote |
Chart |
News |
PowerRating) seems to have some support at 280, and we could see a
reaction bounce tomorrow from this mini triple bottom. This is just a small
scalp, in my opinion, as the trend is most definitely down, and there is a
trendline not too far overhead. But for a day, it may work out.
Heating Oil (HOK3)
may have made a double bottom, but there are a lot of stops right under Friday’s
lows, I imagine. If these are taken out, look for a long setup. A break above
Wednesday’s high might be another choice for a scalp trade.
Short
Candidates:
Contract
|
Setup
|
Direction
|
Trigger
|
Cattle (LCJ3) |
overbought rally |
down | below Wednesday’s low |
Soy Meal (SMK3) |
rally to H&S neckline |
down | below Wednesday’s low |
Cattle (LCJ3)
looks overbought, and may have made a mini double top.
Soy Meal
(
SMK3 |
Quote |
Chart |
News |
PowerRating) is trading at the bottom of a consolidation after
bouncing off the neckline of a head and shoulders pattern. A break below this
area is bearish.
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.