Futures Market - Food Highlight #2
"Seasonal Launching" trading technique precedes sharp rally and misses first half 1998 low in cocoa by 1 day.
(COMMENT # 86)
UPDATED 19980213
COMMENT 1998-86
Just like reading these COMMENTS is something new for you, writing them is also something new for me. It is thus that I must humbly announce that the market discussed in COMMENT # 76 was cotton.
1. Although the market is favored, the breaking of the up trendline discussed suggests loss of momentum and, at the least, a period of consolidation.
2. Turn to page 332. Can you determine the normal tendency for this market over the next few months from the chart on this page?
3. It is expected that this lost momentum will return to this market. Traders should thus be particularly sensitive to signals that would suggest the up trend is attempting to reassert itself if positions have been exited or one is willing to add positions.
4. As an example, as this is written at 11:46 CST, a simple break of today's high would be such a signal, especially since today's low (so far) in CTH at 6630 is just barely below the .618 retracement of the entire 980126 to 980210 upmove.
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