WE GOTTA SOMA QUESTIONS!

Stock Indexes, what up?

Before I get to the topic of the day which I will handle last, let's take a look at something interesting in the SP Futures. Whether or not you trade the DOW FUTURES the ES or any other index, the setup is basically the same. The COT data shows a shift to the short side here in the commercials and at the same time we have a major trend line being challenged. On a short term basis if we close below this trend line, we have a shot at getting down into a good buy spot for the end of the year rally. The one thing we have seen so many times in this FED dominated era is for a trend line like this to break and then have the market reverse course and rally.

I do have some sell signals in some markets for tomorrow and one is in the NAZ. However, it did not make it through my filtering process. Sometimes things don't line up perfect but that does not mean this is not a sell here. What bothers me about his setup is that it is just stair stepping down here and it is still above the last pivot prior to the high. This means that the trend is still intact but is living dangerously here. If I had to bet what will happen here I would say over the next couple of weeks we are going to work lower, but I do not expect a sharp down move. There is a presidential re-election at stake and we are starting to hear them use the stock market as a reason why BO has done such a good job. I think most of the public understands that a good portion of the rally off the 09 lows was directly created by the FED so they discount the stock market strength. I still will be very surprised to see a major break before the election. 

That is all opinion which I do not trade with, but I wanted to get it out there. From a technical stand point most of the trades I have on my roster for tomorrow are sells with a couple of buys in markets that are not correlated directly to the stock market.

Here is something I will call the battle of the bands. You can see really contrasting indications of commercial activity between my COT adaptation and the COT data. The Dollar Index has been in a steady downtrend ever since comrade Ben announced QE Infinity. I like the retracement here in price up while my indicator is declining indicating insider selling of the rally. However, the COT data shows very strong commercial buying here which would say not to sell the rally. My new tool says to look for sells soon and the COT says not to. Just buying a market that is going down like this because the commercials are now heavily long is generally not a good idea. You could argue that they are now at the same long level or higher than they were at the lowest low on the charts and price is higher and that makes this bullish. That would be a reasonable argument to make. That is what makes the COT stuff challenging, it is an Art not a science. It is the lack of congruity of this data that has led me to look for other things. I have covered this in more detail in the first edition of my monthly newsletter which I am just finishing up for release tomorrow. It will be interesting to see which band wins the battle here.

This particular setup would be better if price were to rally some more up into my red band area which would likely mean a stock decline. The VIX is also foretelling of some stock weakness, so the evidence on a short term basis, is for a decline. 

HOUSEKEEPING

Thanks to all of you who have given some of my services a whirl. I am in the process of sending out introductory documents. If you have not received anything yet and did sign up for the Swing or Bond trades please email me at cj@wearefuturestraders.com. This is not a link just copy and paste it. The demand has been far more than I anticipated and I have fallen behind a little bit in all the back office stuff. If you signed up for the newsletter, I have not sent out anything on that yet. You will just get it via email tomorrow night. If you do not get one and have checked your spam email me. There have been a few inconsistencies between the email notices I get from Pay Pal and the spreadsheet I get when I log in. I am reconciling it to make sure everyone is accounted for.

The one comment I want to make here that I hope everyone pays close attention to is the following. The Swing trades are not the same as the Bond system in either duration or style. They are a different way of trading. I know some of you are excited about how well you have done in the Bond trades and nobody is happier than I am that they have worked out so well. However, don't assume that the Swing trades are just a straight path to a pot of gold. There will be losses and the winning percentage will be much lower. We will catch some larger moves which is what they are designed to do, but trading is not an easy business. I was nervous over the trades I put in for tomorrow, I have a lot to lose here and I want to urge patience. I think it is best to watch them first so you can see how they play out and what the stops and targets are. You need to be comfortable that this style is for you. This is why I made this just a month to month. I want to make sure people are not stuck having paid for a quarter or a year in something they don't like. For me this is about getting the right people and having them stick with this. I don't want to jam a bunch of people in and have them be unhappy.

The proper way to use them is to first watch a few play out and determine if you can trade the way the orders dictate. You need to take a little ownership from the standpoint of figuring out what the stop loss dollar amounts are, and what percentage of your account to risk. If you just blindly take all the trades you are not going to learn anything. If you are not sure for example what the dollar risk is for 330 points in Heating Oil you should not be trading Heating Oil. You need to get a little involved. Take the time to look this up yourself so you have a better feel for what you are doing. We will give you the entries and exits every day, but to learn anything you have to be a little involved. Over the course of time we will be going through the what and why of these trades. You need to invest something other than just the $100 to be successful. I think most of you want to learn so this is your chance. Please do not expect a winning streak like what we have going in Bonds.

I hope this makes sense. I will be sending out some emails covering some of the other questions that have come up so look for those in the next day or so. This has been a gargantuan task getting all of this organized but I think we are going to have some fun together even though we will take a lump here and there.

Good Trading

IF IT AIN'T BROKE DON'T VIX IT - TRADING FUTURES WITH THE VIX

I have talked about this before in here. The above is a chart of the VIX and it shows one of the ways it can be used to trade the DOW FUTURES or SP FUTURES. It can be used to trade the other indexes as well. I just highlighted those two because they are the most commonly used vehicles to trade. Using the VIX is something I will be covering in my writings in the monthly publication in great detail. I think this is the best timing tool for the stock market on a short term basis.

There have been many things written about this over the years. The one main idea with this you need to keep in mind is that static levels are irrelevant. It is all about relative value here. You can see here we just entered the upper bands here which in the recent past has been a good buy signal. I am still looking for us to hang in there until the end of November or at least until after the election, before anything big happens. This gives some support for a short term long position.

Thanks to everyone who has been trying out the services in my new web site. The demand has been so much stronger than I anticipated and I have fallen behind on the administrative aspect of things. Bear with me. If we happen to start late, I will give Swing subs a free first month. I am considering changing to emailing the trades as opposed to the log in retrieval plan. The problem with this is the disclaimer that is required. I am mulling this over. You should have gotten an email regarding this tonight. If you did not email me from the web site, the emails are working correctly now.

PFG

There was an email that went out today in regards to verifying your accounts with PFG through Rust Omni. If you tried to do this and had problems you are not alone. I tried all my accounts and none of them worked. I then called them and they could not pull them up either and told me the system was not working. Thank goodness they have had 3 months and been paid millions. Can you imagine if we had paid them and insulting 250k what the status would be? I will call them again tomorrow and report what I find out. I think this is just the way the "system" works. They just wear you down and try to get you go give up the fight. I will not. I don't think the material facts have changed, the keystone cops just make it seem like it.

I don't have much more than this things look bullish to me for Friday. I only have one sell signal in all of the markets which is rare.

Good Trading

FUTURES TRADING PART III

There have been a few questions regarding the new site and some of the services, that I will cover after I make the point I want to make today. I think most people are aware of the tremendous run the Bond market has made in recent days. We did catch some of this in our Bond System but not as much as I would have liked. However, it is a mechanical system and we have to live with what it brings. It will never be everything to every market condition. If it were, it would fail. The over optimization of systems is a common problem and one I have been guilty of at times. The point for today is along those lines.

You can see I have labeled the 8 consecutive up closes on the chart. I think most people would assume this is a great time to short this market. After all when something has gone up this far it has to come back down doesn't it? I would be willing to bet some of you are thinking "I know this will come down it can't keep going like this." Let's see what the computer says about that.

Since 2002 we have had 6 occurrences of 8 straight up closes. This shows buying at the market on the opening of the next day, using my standard Bond stop, and exiting at the first profitable opening. Although this is not a stellar pattern to run to the computer and click the mouse over, it is different than what most people would expect. At times the markets are completely counter intuitive and you have to roll with what is not what you think should be. In this case a huge short term burst like this is not bearish. This does not mean run out and buy but it certainly is not a sell pattern.

We can reason to ourselves that this is the result of QE Infinity and that may be true. However, we also had that huge decline after the program was announced. Rarely can you time a big market move directly to a fundamental event precisely. I told readers here at least 6 months ago that QE 3 was coming, even when the FED was denying it. The economy is so much worse than what they are leading on, it is worrisome. I had dinner with one of my best friends last night to catch up since I had not seen him in awhile. He is an incredibly successful guy, one of the very best at what he does in the US. We discussed for a brief time the political situation in this country and both agreed that we have serious serious problems if BO wins. Ironically he has been much more of a democrat than a republican, but shares my concerns about the long term problems BO is creating for us. I don't want to get to into politics here, it always gets me into trouble. However, the point is don't put your head into the sand. When it comes to voting this year do your research and be sure you understand what each guy represents. Forget about the media and their biases. Make your own decision and be comfortable with what it brings. It could very well bring us to a spot we can't recover from.

I think there is too much apathy, and that is allowing the sea change that is being orchestrated to happen. It is a numbers game. If 50.1% go one way that is basically it. I would be willing to bet that about 20% of the public pays no attention to any of this and does not care. Folks that is what they are counting on! DO NOT BE THAT GUY. Some day we are going to wake up and not recognize where we live any more. What the FED is doing now is going to result at some point in a crash for the ages. It will not be tomorrow, but it is going to happen. I see Gensler is now trying to get the Libor rate raised way up. This SOB just keeps giving gifts to me. I have an adjustable mortgage based on the Libor. First he presides over MF and PFG and says sorry even the police don't catch all the criminals. He indirectly there takes away hundreds of thousands of my dollars. Now he wants to kick me while I am down and raise my mortgage payment. I am not sure who I want to go into the Octagon first with, Wassendorf or him. As Gordon Gekko said, "if this guy owned a funeral parlor nobody would die." 

We may not care about politics, but elections have consequences and this idiot has to go. The commodities markets represents trillions of dollars collectively and we have this guy overseeing them.

Here is my model for stock swings that I will be using throughout my newsletter to give directional bias. I am not going to fully explain it here, that will be for those readers who subscribe to it. What I do want to show is what is says at the moment.

What I am looking for at the moment is a similar pattern to the one I have marked on the chart. My first look on this dip is a buy once we get into my zones marked with the green line. We know that typically October is the month to buy stocks and this could play out very nicely if we decline into that time zone. Once that rally begins it will be time to watch to see if my COT Indicator shows selling on the rally. If by chance we were to rally into the end of November and get a sell indicated with my tools, that could be a very good sell signal. The reason for that is that our weird Euro chart shows that time frame as a possible significant top. You can see that by and large my indicator does a pretty good job of telling us what side to be on. 

The main question that seems to be coming out is in regards to the Swing trades in the new web site. The best way I can describe those trades is that they are the trades that I do and have shown periodically in here over the last couple of years. You have seen me catch some big moves like Coffee, Hogs and Natural Gas. There have also been losing trades as well. The biggest difference between these trades and the Bond System is these attempt to catch larger moves and use trailing stops and targets. The Bond trades are designed to catch very short term moves and exit quickly. The average stop loss in the Swing trades will be lower because I trade all the markets with them. A stop in Bean Oil might be $600 - $800 per contract. There are others like Gold where the stops are much larger, but you can trade the mini's to get the stop down. Historically I have made much more money in the Swing trades because there are more of them. The last time I did this in 2007 they made over $40,000 for the year. I have been trying to find the records for them and can't seem to. I have crashed a few hard drives and I know I have it backed up somewhere but can't find it at the moment. That amount is not a promise it is just a fact of the prior track record of it. I cannot guarantee anything as everyone knows.

The Bond System has just been on such a great run, it is out performing what it has done in the past. This does not mean you should just chase the hot hand. I point that out because I don't think you should compare what that system is currently doing and assume it will always be that good. I hope it is I use it myself. However, I know systems have equity swings also and the subs have caught a great opening run who have been using it. I just don't want everyone to think we won't take losses, we will I guarantee it. I am going to limit the number of subs in the Bond System. I am not sure yet on the Swing trades, I have to get a feel for the interest level to make that determination. So far the interest has been strong.

It really comes down to an individual choice, they are two different approaches. For those of you who cannot watch the markets intraday, the Swing trades are probably a better choice since they are not designed to exit quickly. The last time I offered this type of thing back in 2007 I did free trials and that was a nightmare. I had hundreds of people coming and going who just took anything free they could find. Trying to administer all of that was very difficult. I am sure many of them did not even know what they were signing up for. The reason I made both the trading services monthly billing is to enable people to leave quickly if they want to and not be trapped having paid for a whole year. If you are unsure you can sign up for a month and see if you like it. If you don't just cancel it and you have spent either $75 or $100. I can't make it any cheaper than that.

This whole thing only works if I have a happy stable base of clients and that is what I want. I am not going to be a Vegas ad telling everyone how great I am and create a merry go round. That is no good for anyone. I am going to have a comments section in the Newsletter and I will publish both good and bad to be fair. I know there will be bad so I hope there is some good to mix in with it!

I am told by my web hoster that the emails are fixed so email me any questions. If it does not work use my home email, mktwzrd1@gmail.com

Good Trading

FUTURES TRADING ENTERS A NEW ERA PART II

THE GOOD, THE BAD, AND THE UGLY

This can be a lesson to anyone reading. When you stray away from your core competency too far, sometimes you lose sight of certain things. I was pleased to finally get my site launched today even though there are a few bugs. I am sorry the emails do not work in the contact section. My hoster told me they did and I did not double check them. When I did tonight I discovered none of them work, ARGHH! This has been a big distraction from my trading, and now I can get back to business. Today was one of the worst trading days I have had in a while, but the good news was the Bond System fired off another primo trade for the subs. The students beat the teacher today, there is no doubt about that. I managed to overcome the great Bond trade with what you will see below.

Thanks to everyone who signed up for something. There will be information coming to you soon. Everything kicks off October 1. The newsletter will be emailed to you when it is released each month. It will come initially from mktwzrd1@gmail.com, so make sure you have that as an accepted source so it does not get kicked into SPAM. The Bond orders will continue to be sent via email. The Swing trades will be in the website at the designated time each day. There will be days where there are no trades, but on those days the site will state no trades. For those who are doing both the bonds and the Swing trades, be prepared for a lower winning percentage in the Swing trades but higher average profit. Of course the Bonds are basically 100% at this point, so anything will be less accurate than that. Keep in mind they are two different approaches. You are spoiled so far with the Bonds having only one loss of $31 and all the other trades having been wins. I am looking forward to getting rolling on this. I am especially excited to send out the first newsletter edition.

Let me show everyone where I went wrong today, this is something I know better than to do, but I have been too distracted in recent days. Here it is.

RUSSELL

GOLD

If you switched the symbols on these two charts, you would barely be able to tell them apart. The first one is the Russell and the second one is GOLD. These are the same trade, and I did both of them, what a ding bat! I harp all the time about correlations, and I lost sight of it here. There actually is some logic as to why I ignored this correlation when I normally would not have. Michael and I have been playing around with a new trading approach, that is very mechanical. In those instances you just take the trades. I have been trading like this to try it out for about a month, and had not been burned like this. My thinking in systems is you take them all. They systems do not know if they are correlating with something else or not. The reality is these are trades I normally would have never done, and this new approach gets officially kicked to the curb now. I will keep studying it, but not with live ammo for a bit now. Thanks to PFG I don't have enough free capital to experiment like I used to do.

I will cover this subject in detail in an edition of the newsletter, it is very important in how you do your trading. Over exposing yourself to the same trade like I did today is not wise, and it will always catch up to you if this is something you continually do.

It looks to me like the date I mentioned yesterday, about the Presidential cycle dip being due was dead on. Most of the things I use are saying we are likely to go down in most places here in the next week. Beyond that I do not know at this point. My main S & P model does not have a major sell signal here yet. My COT Synthetic is in the sell zone, but it is not reliable when against a trend this strong. I will explain this as well as time goes on to readers of the newsletter. It will be featured every month as a directional tool for which way to look. It is pretty good, but like everything else, it occasionally makes a wrong turn. Typically the wrong indications are the ones that look like this does ( not pictured ), where the indicator says sell when price is flying upward in a big uptrend. There is nothing that picks tops accurately other than a time machine.

I apologize this is a crummy chart, but hopefully you can see it. This is the Presidential cycle in year 4 of a term. Today is the exact day in time where the arrow on the chart indicates a minor dip in price should begin, which will last into the end of October. The Presidential cycle does call for a strong rally into the end of the year in the 4th year of the "regime." You can clearly see that on the chart with the black arrow.

I think from a short term standpoint we need to sell the first bounce here, but bigger picture after that leads to another down leg, it will be a good longer term buy spot.

Good Trading

FUTURES TRADING ENTERS A NEW ERA.... AN HONEST MAN ENTERS THE ROOM

My web site is launched, and here is just a small capture of the home page top portion.

WWW.WEAREFUTURESTRADERS.COM

THE LINK TO THE TRADING WEB SITE IS TO THE RIGHT HERE UNTIL I CAN MAKE IT BETTER

I want to take some time here to cover what this is and what it is not.

This is designed to be a basic site that talks a little bit about me and my partner and fellow trader Michael Poissant. It will detail the services we are offering right now. Many of you may not know Michael, but I can assure you he is one of the best traders that I know. I would not have chosen him as a partner if he were not. We work together developing strategies, and have very similar approaches to trading.

Initially I wanted to get this launched to make it easy for those looking for a Pay Pal option for the Bond System. However, the bigger picture for me in this is to get back into writing a newsletter each month. I made the price $125 per year, which is very inexpensive, probably far too cheap. I did this to make it appeal to a wide audience. What you will find is that there is going to be an abundance of information in this publication. It may leave people wondering why I am revealing so much of what I do?

If you produce anything that someone else pays for, no matter what the price, it better be your best damn effort. I have been surfing the web in recent months, and there is so much hype involved in selling financial products. I will be using some of my successes to advertise, but I will not a running Vegas add with flashing lights. I will under no circumstances ever over promise anything. Having seen that last postcard from a newsletter writer with the revisionist history on it, I was just disgusted. I pledged to myself to never do that EVER. I did email that person, and of course got the standard BS response. He is a phony let's just call him what he is. Ironically he has a long standing publication with a pretty good following. Go figure!

The goal for me is to help people who are struggling to find their way trading, and to do it in a way that is inexpensive. I will certainly not get rich off $125 per year, but it will cover my expenses and time to do it. I had someone tell me the other day about a seminar they were paying over $7000 to go to. I sure hope he becomes a very good trader after paying that amount of money. The truth is, you are going to have to pay something to learn from anyone worth learning from. At the same time it should not be so expensive, that it leaves you with no money left to start trading. I will go through in a comprehensive fashion, what I have learned over the years. I will give each month a view of the coming month in the markets and where I see opportunities. We will have special alerts within the month when conditions dictating immediate action arise. I will also cover specific trading techniques you can use to trade with. The purpose of a newsletter in my view is to get you thinking. You need to think about what you need to do differently to succeed. In some cases it may be just refining what you are doing. In other cases it may be that you need to change quite a few things. Over the years I have gotten some good ideas from newsletters I have read. Please go to the site directly to get more in depth information. As time goes by we will build a library of past issues that will be available for a reasonable price.

I will continue to do this blog every day in the same fashion I have been doing it. My hope is that a big community can develop here where a good exchange of ideas becomes common place. This will help everyone, myself included. I have limited this forum too much and that is on me. The PFG situation has forced me to do what I should have been doing all along. I had gotten too selfish and too isolated. I had reasoned that I just did not want to deal with all of the stuff that goes on that I did not like. The false advertising is one of these things I just did not want to deal with. I did not want to be associated with that type of thing. If you are not careful you can isolate yourself too much when you are a trader. Most of your friends probably don't have any idea what you do or why you do it. I have very few friends that have any idea what being a trader is really all about.

We are taking a risk here in showing live results in a trading system, and allowing it to be traded by subscribers. This Bond System is the best system Michael and I have. If for some reason having a lot of others use it diminishes it's returns, that will cost us a lot more than the amount of money we are making allowing access to it. It is for that reason we are limiting the number of subscribers to it at a certain level. Once that level is reached, we will form a waiting list. I have raised the price of the Bond System to $75 per month. For those who are already in, you are grandfathered in at the original price of $60. This is your reward for trusting in me from the outset. Since the system is ahead over $4000 in the less than two months I have been sending out the signals, this is still a very good deal. 

You will also see a Swing Trading service. This is basically how I trade most of the time. The Soybean trade I showed last week is an example of what will be in there. Read about that approach on the web site, it is $100 per month. The first newsletter will go out the first of October, and we will be off and running. 

Here are my two guarantees for the services, one will shock you.

1) I guarantee you will get the best Michael and I have to offer. I think anyone who has been reading here for any amount of time would expect that.

2) I guarantee there will be losing trades!

If you think about the second statement, it will make sense. Nobody can guarantee anything in this business, and people get themselves in trouble over-hyping things. I know in my own trading I have losses. Even during my very best runs, I still have some losses. Last week I made 7 trades, 6 were wins and one was a loss. The chart of those trades would not show picking every high and low like so many people do. I ground out a profit with a few good trades, a few marginal ones, and one bad one. What gets lost in this business, is how similar it is in many ways to other businesses. You have to find the correct thing to do. You have to hone that skill. You have to keep working hard at it.

If you choose to follow any of the services, thank you. I think you will be pleased with what you get.

The website due to the PFG wipeout, is a result of yours truly doing it solely on his own. It is not going to win an award for beauty, design, or functionality. It will improve over time as the resources come in. I should be getting some money back from PFG in a month or so, which will be a get out of jail card. I cannot tell readers how dramatically my life was changed by that. What often gets lost in all of these financial fraud cases is the human toll on the victims. I am more fortunate than many because I had some money elsewhere. If I had not been in that situation my life would have literally been destroyed by this. I am past it now emotionally, but financially I do not have the resources to launch a site completely like I would want it to be. I will build and improve it as I move forward. One thing that makes the timing of this somewhat unique, is that through a crime I have been knocked down to where many readers are. We can have at this together going forward, and see what we can get accomplished. It should be fun.

I can assure you the products that come will be the best I have to offer. If you have questions or comments please send them to the contact addresses on the site.

Here is one market I find interesting here, CRUDE OIL.

In general I am looking at the short side of this market. We have had a trend break as you can see, and it comes at a time with a bearish COT picture. However, you can see the COT Synthetic is in the buy zone. We also potentially have a higher short term low Monday, if on Tuesday we were to take out Monday's high. This might be good for a quickie up into where the red arrows are, which could set up a better short entry. This is just a possibility, we never now what will happen. Tomorrow is an ideal day for a short term top to be made in the Presidential Cycle for stocks. If that turns out to be accurate, I doubt we will see a Crude rally.

The Presidential cycle shows just a small dip from this short term top into a late October low, that should launch a good sized rally. We don't know yet if we will dip, our Euro based model does not indicate any dip at all here. I just wanted to point out that Crude is not a layup short right at this very moment, even though the trend has broken on a near term basis. Many of my short term signals are buys for tomorrow, so we will have to see what happens. They are above where the prices are as I go to press here, so none of them are filled yet.

I apologize for the scattered thoughts, it has been a very long day.

Thanks for reading

GOLD FUTURES DISAPPOINT ME.....

I mentioned going into Friday I was thinking the metals looked like buys, here is the trade I did on Friday. This falls into the category of a disappointment. This trade was up a good bit ahead at one point then reversed and came back down. My plan had been to hold it if it closed strong which it did not do. As a result, I bailed out close to the close and made a measly $200. When trends get extended this far with all these little small stair step moves, the air gets a little thin. The branches get weaker the higher you get in a tree, and the trading tree is no different.

What I like a lot on this chart is how well my new baby has worked. The four signals were all good ones, although the last one was a scratch or small loss if traded depending on how it was handled. This is still something I am working on, and it will be part of a series I do with my newsletter. There are so many ways to trade, and I have some very good specific methods with this tool already, I still am working on a few others that are a bit longer in hold times than what you see above.

I still think Silver is a potential buy Monday, but I have not yet fully gone through all the trades yet.

We are nearing a point in time where there are some indications we are going to have a pullback in stocks.

You can see the Presidential Cycle indicates a potential small dip coming starting Monday or Tuesday. If the cycle holds true, which it has so far this year, this will be a small dip or even a sideways move. We are seeing some of the markets that have been closely correlated with stocks, start to decline. Typically stocks have led other markets, so this is interesting. It is too soon to tell if this is  a sign that these correlations are loosening up, I doubt it. They are being driven by the FED and it's attempt to create inflation, so I think I will believe it when I see it when it comes to things returning to normal. I have signals on both sides of several markets for Monday, so it is kind of a mixed bag to me right here. Our Eurodollar chart does not indicate any stock top yet, so it is not in complete agreement with the Presidential cycle. I don't have any strong anti trend divergences in my timing tools, supporting shorts yet in the stock market, and I have short term buys tomorrow.

There has been an interesting development that bears watching, for those who use the Trade Navigator software. There has been a parting of the ways between Larry Williams and Genesis. I do have some detailed information about what is behind this, but I do not feel comfortable stating it here. I do not know what this will mean if anything. We have been assured we will still have access to all of the indicators, but it might be prudent to find a backup option here. I for one would be completely screwed if I woke up one day and had no access here. I am researching a place to try and get a backup plan going. I think the Genesis software is by far the best there is, and that is why I use it, and recommend it to others. I have a feeling any backup plan is not going to be very appealing, but you never know. I just closed my Tradestation accounts due to the poor financial position the ratings agencies are giving their parent company. If we look at the bad things that have happened with FCM's they all can be traced to financial problems with the companies developing first. As a result, I don't know if that is a good option. Tradestation probably has the most flexible systems development software, but it is very complex to learn and use.

Net net, nothing to do right now, but it is always prudent to have a backup plan in everything you do.

PFG Update

The court has approved the initial distribution plan for the first wave, but it has been pushed back some. It appears now the first wave, accounts under 50k, will get their money first. It is now going to be into October for the first wave, and the end of October for the second wave. The trustee is soliciting bids from FCM's for a bulk transfer. I have no idea what the interest level is on the part of FCM's. Most people seem to think it will be low. As I have stated, since we know now how vitally important it is to have multiple accounts at different FCM's. I am likely to leave mine where it lands if they do a bulk transfer, as long as it is a different place than where I have the current two accounts. I don't think either of those places is in the business of bidding for something like this anyway.

The lawsuit by Wassendorf Jr continues to be a very important development if there is any merit to it. It is very interesting to me that no statement by the NFA has been made here. The call either was made to the NFA or it was not. If it was they could deflect a huge amount of anger away from them, as well as potentially lawsuits that have been filed against them. The main critique has been they were negligent because they never spoke to anyone at the bank. If this allegation Jr made is true, they actually did speak to someone at the bank. It is bizarre just like so much that relates to this case. Also you have to keep in mind that legal maneuvering is just that. You might file a suit to try and get something else to happen, even if the suit you file does not have much merit.

Website Update

I am actually ready to go but have spent yet another weekend without access to my FTP site due to trouble with my web hoster. Basically the editor where I can create and modify my content does not allow you to enter HTML code, even though it converts what I enter to HTML. When I tried to import the code for the Pay Pal buttons the whole thing shut down. I am furious with this guy at this point. I sent a message indicating a resolution will happen by Monday or I am going elsewhere. Let's hope he chooses Monday, otherwise I am going to be delayed again. Hopefully come Tuesday things will be rolling. I will be building this over time and redesigning upgrading etc.. so cut me a little slack day one. It is not intended to be an and end all for charting, researching, or things like that. It is designed to introduce me and my partner Michael, describe what we do, why we do it, and what we are offering.

Other things will be added as we move on.

This week is an important week due to the cycle up top, let's see what happens.

Good Trading

FUTURES TRADING AT IT'S WORST

This is a scan of a post card I got in the mail today. Mark my words right here and now, I will never as long as I live sell my soul and lie like this in an attempt to get subscribers. Here is the worst part about this, I was actually subscribing to this persons newsletter at the time these claimed calls were made. Guess what, this is not what they called for at the time. In fact not only did they not get the low in 2009 as they have marked here, they steadfastly called for 5500 in the Dow, even after the rally started. If you were trading either Dow Futures or S & P futures, or the E mini S & P futures, you would have repeatedly lost on trades listening to this groups advice. They repeatedly called out selling spots all the way up in both stocks and other commodities markets, and were dead wrong on all of them as well, resulting in me cancelling. I am always willing to learn something from someone else, and that is why I was reading this guys work.

This is a disgrace and gives all of us a bad name. I did email them complaining about this false advertising. Please do not fall for this type of ploy, nobody catches every swing like that, NOBODY. The BS in the middle of the chart is my commentary, that was not on the post card. Hopefully anyone who reads here either before subscribing to anything I have to offer, or does so afterwards, will understand that I call it like it is. When I am wrong I admit it. I just don't understand the logic of being a liar? You may get people in the door, but they won't stay. My intention is to get a core group of people who stay with me. Arghh this really ticked me off when I got it when I saw who it was from. I have an example in my site ironically which is getting close to launching, that I am going to replace with this unless there is a legal issue with doing so, as an example of what not to be fooled by. Nobody is that good including me.

We are mostly in pullback buy mode in places with a couple of exceptions. The energies are in a spot where I would not call them pullback buys, but more in transition. They need to rally some to re-establish their up trends, or bounces are sells. I don't see a play right here.

You saw today why I took the Bean Oil long as a short term trade. By my rules it was against the trend after the big break. I do not overstay my welcome against the trends. Some times I get out too soon on counter trend trades, but I am not in the business of being a hero trading against trends. I have watched that movie on Cinemax for years and am not interested any more. Most of you will eventually have to learn the hard way not to trade against the trend, regardless of what people like me tell you.

Here is the world's favorite market in a sideways consolidation move. This is winding up for a move in one direction or the other, so breakout mode play is the way I am looking at this.

I am still looking for Joe Theisman's wife for an interview. I am not buying that he sleeps through the whole night. I think he is getting up many times and pissing her off to no end ( pun intended ). For those who don't understand this, be thankful you are not hearing those commercials all night long.

Good Trading

SO YOU WANT TO TRADE CRUDE OIL FUTURES DO YOU?

I think at this point the two markets that probably get the most attention are Gold and Crude Oil. In spite of all the opinions and conjecture about why a certain price move happens, you still see the good ole tools occasionally find an acorn. For those of you who are struggling going from one complex method to the next, trying to find a way to trade well, just look at the above chart. We had a fundamental condition, significant COT selling. We then had a false breakout to a new high that reversed the very next day. That reversal day also broke the up trend line from the lows.

This is about as good of a sell setup as you can get. I pointed out the other day how similar I thought the chart pattern was to the last big turn down in Heating Oil. These are the types of things I will be writing about every month in my newsletter. We will also send out special bulletins when we see something like this setting up. You should not expect one every week, they do not set up this well that often. However, when they do we will let you know. I will still be doing my commentary in here every day, but I will not be able to always point out everything all the time. Further, the exact timing of these setups is important. It is helpful to know they are here, but it is another thing to be able to take action at the appropriate time.

There are a number of ways to trade, and this type of trade does take a larger stop, and a different approach than most others. Here we are trying to get into a trade with a large potential move that can be held for a bit. It requires a different mindset. Most people can't stand the sight of a few thousand dollars profit in their accounts, and will not be able to catch these big moves. I can tell you that you will never get rich trading without catching some big moves. All this stuff about scalping $50 at a time on a 75 tick chart, is just that "stuff." Even for the rare few who can do it, it is incredibly draining to trade like that glued to every tick on the screen. I know I have been there.

If you do decide to read my newsletter, and elect to trade some of these types of things me and my partner Mike write about, please please, do not watch intraday charts once the trades are on. You will never catch a multi - week move watching a 30 min chart or any other short term chart for that matter. Net net here, we had a great fundamental setup, I pointed it out, and down we are going.

The ES is starting to feel a bit heavy to me here, perhaps the September swoon may still happen. All my short term signals are still buys there, so if we see this night weakness reverses, I will be pulled into some long side positions.

Here is a small little trade I made today in Soybean Oil. I had mentioned that Soybeans should be exited if Tuesday's high was taken out. I had some patterns that were bullish in Bean Oil, so when the Soybean trade was about to get stopped out, I went long in Bean Oil and exited at the close for a quick 50 points there. Bean Oil had held up the best of the bean complex, so it made sense to me to take a buy there if I was going to be exiting my short in the weak one.This was kind of a goofy little trade, but it made some money.

I am still looking at shorting this rally, so this was basically a day type of trade. However, I never looked at a single intraday chart. I do not even have any intraday charts in my work spaces. You can trade short term without being a slave to the machine. I put these orders in including an exit a couple of minutes before the close on a contingent order, and went off to do something else. I checked in at 3 pm to see how I did. It does not need to be more complicated than that. If it is try something else. I have been looking at web sites on trading, and I don't see any where the people say they actually take the trades they teach. It seems they hype what great teachers they are and how they can help, but don't show any proof they make money themselves. Whether it is me or someone else, don't take instruction from someone who is not using the techniques they are teaching you themselves. If what they are teaching you is so great, they should be using it themselves to make money. I talk to people all the time about trading, and I don't like what I hear about the paths they are going down. 

PFG

I read the trustee's website, and it does appear from the motion in the court he filed that we might have to fill out claim forms. Once the motion is approved, if that is the determination of the court, I will post that information here. I would assume if there is one the process of getting us some money is going to be slowed down considerably. There are 17,000 people getting money in the first distribution. That ought to be good for another 50 - 100 large for the trustee ( $50,000 - $100,000).

Think about how messed up that is, we are paying them probably at least $100,000 to a process a claim form that results in us only getting back 30% or our money. Bankruptcy is a great business if you are a vulture apparently. The longer things can be dragged out the more re-distribution can take place. Sound familiar, politics ring a bell?

Now that I have had time to digest the law suit by Jr against US Bank I have one thought. I think it is legal maneuvering. However, even with that being the case, do make these allegations he must have something somewhere to base them on. This case could be so quickly dismissed otherwise. Further he does set himself up for further attacks and humiliation. He has made his life a lot tougher by doing this. Perhaps he is nuts or maybe he just thinks "well I am bankrupt anyway so why not take a shot." However, even with either of those states of mind being possible, it seems there still has to be some merit or the suit would go nowhere. It will be interesting to see what comes out. The bank's response means nothing., but if they are guilty they are going to be in very big trouble. Aside from the recovery for us, I would expect a monster fine, if it can be proven they had a hand in this fraud. They were grossly negligent in this situation, even if they are not guilty of what Jr. is alleging.

My gut is that it goes nowhere, but I hope I am wrong.

Most of my looks tomorrow are on the long side, so if we roll over here I am going to be watching from the sidelines, and trying to finish up the web site.

Good Trading

DOW JONES FUTURES WRAP UP

I realize the thread has strayed away from the original idea about Dow Jones Futures, but I just want to finish up the tracking of this trade. You can see we just missed my target here today which was about 9 cents under the low. At this point it is my feeling that the stop should be right where it is indicated, above the high of today. It may well be that this is too close. However, this was a break away type of bar, so if it is quickly taken out, this move down could have been a fake. Once I get a big profit going I tend to track the stops tight and just trap myself out of these types of trades. At times you get a big run, and the price just goes. At other times it just gives a quick burst, then reverses. Since I am not in the business to never be wrong, I tailor my approach to what I am looking to do, and call it a day. If I get taken out here so be it, the profit is still a good one for only being in the trade such a short amount of time.

I could care less about the fundamentals of what the crop reports show. They had nothing to do with why I did this trade, so why should I care what they say now? Just like Eastwood says, "a man has to know his limitations." I know mine.

Here is a fundamental setup that I think is worth pointing out. I know many people like to trade Crude Oil Futures, and this is in the same complex. This is more indicative of the type of thing I will be discussing in one section of my newsletter. I will be covering both short term and longer term ways of trading. Here is a setup to look for a big move from.

This is a situation that is a little unusual, but it goes to show how you need to know how to read the COT report to look for setups. Here we have a key price level being tested in Heating Oil, and at the same time a huge increase in open interest, while at the same time there is a large amount of commercial selling. This basically shows the small money is buying this move into this big resistance level. There are no absolutes I know of, but this is a situation where we have to be on the lookout for sell signals. When you have a big picture fundamental setup like this, it needs to be handled differently than just getting a signal on a daily chart. I will be getting into this in my writings over the next several months. This is why I am not super bullish at the moment on energies. This is a sell setup in my world, not a buy.

PFG

I did say that I did not think much would happen here, then a weird story came out today about Wassendorf Jr suing US Bank. Some of the stories indicate the suit accuses a specific person of being involved in the fraud, others just say it is a ploy to try and get out from underneath the $6 Million loan guarantee he has on the HQ building. I think it is most likely the latter, and not to be paid attention to. It would be nice if this had merit, but I doubt it does. If it did and this bank employee did by chance do what he is alleging, you can release the balloons. We all will wind up whole if this by some long shot turns out to be true. If a major bank participated in a fraud like this, the award would be a huge amount, and most likely would be settled. I find it hard to believe this could be true because I think some word along these lines would have leaked out by now. This would take the NFA off the hook if they had actually been told directly by a bank employee, that the revised statement was correct and it was a forgery. It is hard to believe they would not have stated that by now to clear their name, since their very existence is in jeopardy over this. Do not get your hopes up if you read this story, I think it is a ruse.

I thought this next picture was indicative of future students of mine looking up to the instructor for something they want. Perhaps this is how our Futures Trading class will look? This is not me in the picture, but you get the idea I think. We will have beginners and advanced students, come one, come all.

Good trading

DOW JONES FUTURE, WHAT IS THE FUTURE FOLLOW UP

Over the weekend I pointed out the selling opportunity I saw in Soybeans, and today we were rewarded with a limit down move. I would love to think I have enough of a following where I caused this, but obviously that is not the case. My following is me, myself and I, and a small posse that is growing slowly. This is an example of what I will be calling a Swing Trade in my upcoming website. These trades will cover all the markets, and are designed to catch moves of 3 to 15 days. 

Just to walk through this one going forward, here are the next steps for me. It is really easy to get excited about a boomer first day in a trade like this, but you have to keep the emotions out of this. We may well just go straight back up from here. However, when I have a potential bigger fish on the line, I try to ride them. Since we had an across the board huge decline in the grains, some follow through should happen. The initial target for this trade is 1621 where I have the red line on the screen. Will we get there? I have no idea. What I do know is that during the course of a year, I have to catch a few big fish to really grow my account. From a short term stand point, if we were to get a couple more down days, it would probably be a good profit taking spot. At this point with a win this big, my stop is at break even. If we just bounce right back to that level, I want to be out. I do run the risk of giving back a big profit, but in case you had not noticed, there is risk in trading futures!

Readers are going to have to bear with me, you will see this market call in some of the marketing I will be doing to try and build a base of subscribers. Can you blame me? I am a understated type of person, so self marketing is not something that comes easily to me, but I have to do some now to get my web site going once it is launched. Besides, anyone who read this and took this trade certainly benefited in spades. The question now is, are we seeing the beginning of the standard September commodities sell off? It is hard to say. The HFT factor is always out there and when you see a move in the energies like today, you have to wonder some times what is behind it.

We saw a sharp break in energies that was quickly reversed almost back to the break out spot. This reminds me of a trade from last year in Heating Oil.

You can see in this instance a similar day. We were tooling along, strong up trend, no worries, then boom. We came all the way back that day to the break out point, and it looked like we might just sail back up. However, what most people missed there was the trend line had broken on that first day. That also happened today. There was a very prominent trend line that broke decisively. Once the low went the next day we knew we were in business. We don't know if the same thing will happen this time, but I wanted to point this out just because I thought it was so similar. The markets have a funny way of making the news people look bad. All the commentary about why the middle east turmoil should cause Oil prices to sky rocket, and that is the top. This is not uncommon. One of the things we have to do if focus on price action and not all this BS about what should happen and why. There are things to know that move markets, but you will not hear them on television. The people that report on these things have no clue, don't trade, and probably don't care to learn. They are paid for volume ( words ) not for accuracy. I always love the breaking reports on CNBC, they always give you a possible buy and sell scenario on every report. Isn't that the whole point? We already knew it could go up or down before we tuned in.

As to the trade in the energies, when I see a bar that wide if I am not in a trade already, I wait for the dust to settle. I may miss a big move, but this stop is just way too big for my taste. If I were short now, my stop would be above yesterday's high. If we are going down, that spot should not be seen again.

PFG UPDATE

Unfortunately we are now likely going into another lengthy period with nothing new being reported. The initial distribution with what I will call the F You amount, is going to happen in two phases, one Sept 28th, and another a couple week later in October. You do not need to file a claim form. They apparently are distributing based on the last account statements. If you have not verified yours, go to the CCC website here and read the instruction on how to check your accounts.

 http://commoditycustomercoalition.org/?p=2218

I did so and all four of mine showed the correct balances. It is 30 to 40% of those balances depending on your classification. At this point Forex is not included. In my case that is still well into 6 figures, but we now see all the quotes from the trustee about how we are not going to get all of our money back. This tells me he is not tough which is what is required, and what helped the Madoff victims so much. They have a very tough trustee who threatened people with lawsuits all over the place, and intimidated people on the fringe into playing ball. Why this guy is not doing the same I have no idea. At the very least you would think he would go after the banks.

There has to be something unusual that went on there, but it is just one big secret. All we know is there was a Corleone payoff to a fat attorney who looks like she ate the $200 Million in Twinkies. She supposedly turned down a partner position in another firm to stay? I am calling BS on that. I would have said take it then subpoenaed her the next day. What is another few hundred bucks, they have already racked up into the millions in legal and accounting fees at this point, with all of us sitting here on a goose egg. They have not found a single dollar that has been reported, that indicates it was beyond what was reported to have been missing the day this whole thing imploded.

The biggest problem with this, and it is a common problem, is lack of communication. There could very well be decent explanations for everything that will make all of this understandable, yet we are not privy to these top secret dealings. Here is one thing I have learned, bankruptcies are designed to bilk creditors and make attorneys millionaires. I guess my decision not to become an attorney I made in my 20's was a bad one. However, I have a conscience problem. There is no way I could hear all these stories of people having their lives ruined, and be comfortable knowing I had made millions from it. Had I become an attorney, I would have quit the day OJ walked. At that time my girlfriend was an attorney at a large LA based firm. I was on the phone with here when that verdict was read, I told her if she had any guts she would quit.

I will give updates now going forward only when there are new developments, which will likely not be every day. It is time to focus solely on making money trading and not crying over what is no longer here.

I hope some of you are short the grains, and the trade keeps rolling for us.

Good Trading

DOW JONES FUTURES - WHAT IS THE FUTURE?

I debated this for quite some time, but finally made a decision. When I begin publishing my newsletter, the first issue is going to cover one of my most prized possessions. I think it is important to give people who trust in you, the best you have. Everyone myself included, wants to try and figure out where the DOW is going next. Since we know that most markets with a few exceptions, trade almost tick for tick with the Dow now, we can help our trading immensely, if we have a good idea where stocks are going. You can see where the lines are drawn on the chart, by and large indicate pretty good entries into the market. There are 5 winning trades here, and 2 very small losses. That is just taking the indicator straight up. There are ways of filtering these, which I will get into once the newsletter begins. I am also going to discuss exactly what those bands are, how they are calculated, and how to use them. Readers are going to instantly see how helpful they are in every market.

For now, the rules say this is a bull market, no shorts. It is anyone's guess how far we go, but I think new all time highs are coming pretty soon. The whole thing is one big ruse, and we see one thing happen over and over again. Criminals always overdo things, which leads to them getting caught. One of my favorite lines, which came from an alcoholic, is "anything worth doing is worth over doing." If you have a drinking problem this is not funny, but I think it is. I also think it applies to what we are seeing happen in the world right now. The local paper the San Diego Union Tribune, has an article today about how the Fed is saying cutting spending would be catastrophic. Let's examine that statement for a minute.

We currently have an out of control federal deficit, and corresponding national debt. I have yet to find one single instance of a debt problem that was solved by not cutting costs. For me when PFG stole hundreds and hundreds of thousands of dollars from me, did I just increase my spending in reaction to that? Did I decide I would spend my way out of this huge hole that created for me? Of course not, I fired my landscapers, cleaning lady, and cut back every penny I could in every aspect of my life. I went from Whole Foods to Walmart, from $40 wine the $15. I cut back the watering in the pasture of my ranch to reduce the water bill. I changed the size of my trash bin I use. I asked my wife to pay for some of the dog expenses out of her business. I left my country club, and decided not to play golf again for at least a year. This is something I love to do, but I had to sacrifice everything to get through this.You get the gist of this. I looked at every single expense I had knowing I had to cut every penny just to survive.

It actually feels really good to be responsible with money. I had been a millionaire for a long time, and had not been as responsible for money as I should have been. I did not throw it away, but I certainly was wasting it in many places for no reason. If I can do all of this, why in the world can't the government at the very least reduce the amount of the increase in spending each year? Keep in mind when the government talks about spending cuts, they are talking about lowering the rate of the increases, not actually reducing the gross amount they spend. They are now scaring us saying if we don't keep spending irresponsibly, the world is going to end? I say we tell Chicken Little to let it end then!

Here in California, the state legislature just recently passed a bill requiring all companies no matter the size, to provide a retirement plan for every worker. For those who don't there will be fines, and employers could be responsible for gains that theoretically could have been made! If I had not read this with my own eyes I would never have believed it. They are expanding entitlements. The first thing I did when forming my company for the website, was partner with someone in another state and formed the LLC there. The other state has an annual fee for the LLC of $50, Calfornia, $880. OF COURSE! Who in their right mind would start a business of any kind in California? NOBODY. If things go well and we have to hire some people, they will be hired in another state, not here. It is not just talking point chatter, when people say that regulations are killing small businesses. It is a fact.

Now we go across the country to the Chicago teachers strike, and see that a 16% raise is not enough? Who in the world is making annual pay wage increases like that in this economy? If I were running things back there I would blow them all out and hire replacements. Yes education is very important. Is it important enough that it needs to bankrupt the whole state? If you look at the pay amounts including benefits teachers are being offered in the new contract, it totals triple the median income of that area, TRIPLE! It is not good enough.

All of this is leading me to the following. There is one commonality in all of this, it is all not sustainable. The FED keeps doing the money printing to move the stock market higher, hoping that will generate all these other trickle up types of things. The problem is the smart people know they are building an incredible house of cards, and the higher it goes, the more worried they are getting. We are getting close to making new all time highs in stocks, yet there is barely a buzz at all about it. In past big bull markets like this, they were the talk of the news every night. They barely get a mention now because everyone knows it is bogus. It is a sad state of affairs unfortunately.

The point I am making about all of this is as follows. You need to be long, and looking to play the long side of most markets. It is highly unlikely any significant dip will come along before November. When we get dips, if we do, we have to be looking to buy them. There is going to come a time in the future, when this whole thing is going to collapse, and when it does we are going to hope for 2008, because it is going to be a lot worse than that was. It could well be a couple more years, but I do think it is going to occur under BO term 2 and he is going to own it. He is not going to be able to blame W at that point even though I am sure he will try. Even if Romney is able to beat the media and Barry and win, he is going to be stuck with the same problems nobody wants to solve. These problems are decades in the making, so we can blame everyone, not just one side.

As traders we can make money off this stuff, so that is where our focus needs to be. The tools I have that I show above, should help time the entries and exits, and the political stuff really does not matter. The newsletter is going to be $125 a year, so pretty cheap, and a good way to get some very valuable tools to help you. I am getting close on the site, probably next week it will launch. I have to submit business docs to Pay Pal to prove it is legit etc, so that is what is the last thing holding it up. Please do not expect this massive huge resource spot for charting and all types of fancy things. I may be able to eventually build into that, but it is not going to start that way. It is going to detail what I can offer, why it is valuable, and how to get access to it. The services are going to be where the meat is, and it will be easy and cheap to get them. I have priced the newsletter low to get a large audience, not because of content. This is going to be the best deal going.

I mentioned the other day that the grains were lagging the FED asset push, and I think they are setup for sell signals now. Here is one of them, Soybeans, that looks attractive to me here.

I am not a huge fan of reversal bars, and we had one Friday here. However, this market has had a short term trend break, marked on the chart, and it is potentially now making a lower short term high than the peak. It is an aggressive trade, but does seem like one I am going to consider doing.

Thanks for reading