Futures Market - Copper Highlight #3
"FND LAUNCHING" and "Linear Time Cycle Index" signal long copper position 2 days prior to 11 year low and sharp ensuing rally.
(COMMENT # 490, 523)
UPDATED 19980707
COMMENT 1998-490
1. The market in COMMENT # 487 should have gotten everyone off to a good start.
2. Let's now turn to page 300 in "The 1998 $upertrader's Almanac - 2nd Half Edition".
3. Note the uptrend in the middle chart of long term seasonality for the rest of the month or so.
4. Now turn to this, the 28th week of the year, and, specifically, to page 81.
5. Note this market in the "FND LAUNCHINGS" column.
6. If you're not familiar with these terms, you can turn to the "Index" on page 399 and note that they're explained on page 32.
7. The discussion begins at the bottom of page 32 and runs about 2 pages or so - shouldn't take but a minute or two to review.
8. Basis the December contract, this market made a new 10 year low on July 1st, right at the end of the "FND SLAMMER" for this market.
9. Are you beginning to see how this fits?
10. Now we turn to page 345 in "The 1998-99 $upertrader's Book of Linear Time Cycles".
11. See the solid line in the chart at the bottom of the page?
12. This solid line is the "Linear Cycle Index".
13. Note how it turns upward over the next few months from the low of the year in June.
14. Now look at the "histogram" (the vertical solid black bars) at the very bottom of the page.
15. Was this market supposed to make its yearly low around mid-year?
16. Is a 10 year low also the low of the year?
17. Isn't this easy?
18. OK, we've identified some information suggesting that prices should begin to turn up.
19. Now we want to use a trading technique which will provide us an entry point and a market-generated, protective stop.
20. In other words, to make sure that our analysis is correct, we want the market to ratify our analysis and FORCE us into the position.
21. Let's turn to pages 205-209 in "The $upertrader's Reference Manual".
22. Can you see how this technique is appropriate for use TODAY?
23. One of two things happens - the market either forces us into the position or makes a new low.
24. If the first instance, we enter our stop and go to the beach.
25. In the second instance, we still have the timing analysis suggesting a bottom, but we have to reanalyze and use a different entry technique.
26. So there you have it.
27. Can you believe how simple this process of trading is?
28. Just turn the pages of the books and pay attention!
UPDATED 19980715
COMMENT 1998-523
1. Noticed how China decided to cut back about 90,000 tons of copper production.
2. Funny how this decision was announced right as the market made a new 10 year low and wiped out public stops, isn't it (unless yours was one of the stops)?
3. Mines are not closed overnight.
4. It takes a considerable period of time to mothball such production, lay off workers, and so on.
5. Information is withheld, however, and released at appropriate times.
6. A revisit to COMMENT # 490 of 980707 with these thoughts in mind might be instructive.
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