To MRCI Online Subscribers: (04/01/2009)
MRCI Seasonal Action Report: to organize trade
actions for the following week. This report is updated daily
as a tool for monitoring trade actions.
Again, we would like to emphasize to our subscribers that trade exit dates are
also historically optimized turning points and can be important points in time
to be looking for market reversals.
Trade Exits:
Trade Entries:
Buying June09 Australian Dollar(CME) on Fri 4/3 close to initiate long
Trade has been profitable 13 of last 15 yrs - Average: $877
(The A$ has typically been strong during much of the last
Australian fiscal quarter, beginning with a surge into mid April;
note the massive gap on weekly charts.)
Buying July09 Natural Gas(NYM) on Mon 4/6 close to initiate long
Trade has been profitable 12 of last 15 yrs - Average: $1449
(NORMALLY, distributors in hot-weather regions that depend on
natural gas to generate electricity accumulate inventories before
the beginning of air-conditioning season.)
Selling December09 Corn(CBOT) on Mon 4/6 close to initiate short
Trade has been profitable 15 of last 15 yrs - Average: $319
(As planting begins in April, new-crop comes under pressure as
acreage is assured.)
Buying June09 Crude Oil(NYM) on Tue 4/7 close to initiate long
Trade has been profitable 13 of last 15 yrs - Average: $1749
(As the summer driving season approaches, refinery utilization
rises and increases consumption of crude oil; but rising
consumption must compete with the need to accumulate inventory,
thereby accelerating demand.)
Buying June09 Gasoline(NYMEX) on Wed 4/8 close to initiate long
Trade has been profitable 14 of last 15 yrs - Average: $2465
(Rising consumption competing with inventory accumulation
accelerates demand.)
Selling June09 Live Cattle(CME) on Thu 4/9 close to initiate short
Trade has been profitable 12 of last 15 yrs - Average: $434
(Comment next week.)
MRCI Spread Action Report: to organize trade
actions for the following week. This report is updated daily
as a tool for monitoring trade actions.
Again, we would like to emphasize to our subscribers that trade exit dates are
also historically optimized turning points and can be important points in time
to be looking for market reversals.
Spread Exits:
Spread Entries:
Corn - Limits still hang ABOVE several deliveries, including that above
May at 450; limits also hang BELOW December 2009 (349.25) and March 2010.
Soybean Oil - Old limits still hang far ABOVE most deliveries through
January 2010, including that ABOVE May at 57.90.
Rough Rice - Limits hang ABOVE May, starting at 16.53.
Cotton - Old limits still hang far ABOVE July (101.50) & October.
Live Cattle - Limit still hangs BELOW October at 81.25.
Feeder Cattle - Recent limits still hang BELOW April (88.87) and May,
with an old limit still hanging far ABOVE thinly traded August (113.17).
Pork Bellies - With limits hanging ABOVE and also BELOW several
deliveries in this illiquid market, the July contract exceeded its limit
below this past week. However, limits still hang BELOW May (82.90)
& August. Instead, July & August traded limit UP on 3/31, and both
exceeded those limits next day. In so doing, however, July reached
limit UP again on 4/1 at 86.55.
Lean Hogs - Limit still hangs ABOVE April at 71.70 and old limits
still hang ABOVE December.
Lumber - Limits hang BELOW May (148.0) & July; but multiple limits
also now hang ABOVE multiple contracts, including that ABOVE nearby
May at 187.5.
New! Click on the "Flashing Yellow Button" located at the top of this
page and on our Spreads Correlations page and we will automatically,
immediately send you an e-mail with attached PDF file containing
ALL current correlation charts. Just flip through' em!
Caution: Each file is approximately 1 megabyte.
Correlation studies usually don't change on a day-to-day basis,
especially when multi-year, multi-contract, and all with
relatively high correlation numbers.
In addition, analyzing correlation studies is subjective, and one must
use them as a tool rather than as a trading system. You must realize
that even high correlation studies can follow a market pattern for an
extended period of time and then suddenly deviate from this expected
pattern. We like to look at correlation studies as giving us roadmaps
as to where the price might go. Then we use other shorter-term trading
tools for navigating the markets on a daily basis.
Dow Industrials:
Single-year correlation for cash index projects potentially dynamic
rally throughout April and eventually into June; but new single-,
different-year study for September futures suggests higher into
early/mid April, then sideways/lower through July.
Dow Transports:
Two-year correlation for cash index suggests persistent rally
into mid April, pullback into May, then higher still into July.
Dow Utilities:
Single-year correlation for cash index projects lower into May.
S&P 500:
Correlations for cash index and for June futures project rally from
early April into May.
S&P 100 (OEX):
Two-year correlation for cash index suggests modest rally from
early April into June.
DAX:
Single-year correlation for cash index projects bounce into mid
April, lower into early May.
CAC-40:
Correlation for cash index projects rally throughout April and
perhaps into May.
NIKKEI 225:
Correlation for cash market suggests lower into late April, then
potentially dynamic rally into July; study for June futures projects
sideways/higher into May.
SPI 200:
Correlation for June futures projects strong rally into May.
Ten-year Treasury Notes:
Correlations for June & September futures projects potentially
sharply lower prices into May.
Eurodollars:
Correlations for June & September still suggest uptrend intact.
Gold:
Correlation for October futures suggests sideways/lower into mid April
before major uptrend into September/October begins.
Platinum:
Five-year correlation for July futures projects choppy trade in
April, then rally into June.
Silver:
Correlations for May & September futures project modestly lower
into mid April.
Copper:
Correlations for cash market and for May & July futures project lower
from mid/late April through May.
Japanese Yen:
Correlations for cash market and for June futures project
sideways/lower into May.
British Pounds:
Correlations for cash market and for June futures suggest dynamic
rally through April.
Canadian Dollars:
Correlation for cash market suggests lower into mid April, then
rally into mid May; study for June futures projects rally
throughout April.
Crude Oil:
Correlations for cash market and for May-October futures suggest
dynamic rally NOW, with those more deferred suggesting rally to
last through July.
Heating Oil:
Correlations for May-November futures suggest dynamic rally at least
through April.
Gasoline:
Correlation for cash market suggests steadily lower from mid/late
April into June/July; but studies for May-September futures project
dynamic rally at least through April if not for several months.
Natural Gas:
Correlations for May-September futures suggest potentially dynamic
rally NOW, with study for October suggesting more moderate rally
through April and then sideways/lower into July.
Cotton:
Correlations for May & July futures suggest modestly lower into
mid/late April.
Lumber:
Correlation for May futures suggests sideways through April;
study for July projects choppy through April, then rally into May;
study for September suggests sideways/lower for months; new study
for November projects lower through April.
Coffee:
Correlation for May futures suggests modestly lower into April;
study for July projects sideways into mid May, then abruptly lower.
Orange Juice:
Correlations for May, July, September & November suggest continued
erosion.
Soybeans:
Correlation for May futures projects moderate rally into April;
study for July suggests sideways through April, with dynamic rally
beginning in May.
Soybean Oil:
Correlations for May & July futures suggest sideways trading range;
study for August projects sideways/lower into May, then dynamic rally.
Corn:
Correlations for May & July futures suggests lower through April.
Oats:
Correlations for May, July & September futures project choppy,
sideways during April.
Wheat:
Correlations for May CBOT, KCBT, and MGE futures project rally into
mid April; but study for July CBOT now suggests lower through April.
Rough Rice:
Correlation for May futures suggest rally through April; study
for September futures projects erosion into May; study for November
suggests choppy, sideways/higher into June, then lower.
Live Cattle:
Correlation for June futures projects rally throughout April.
Feeder Cattle:
Correlations for April & May futures project much lower.
Pork Bellies:
Correlations for July & August futures project choppy through April.
Milk:
Correlation for April futures suggests erosion through expiry.
Best Regards,
Steve Moore
Nick Colley
Jerry Toepke
Melissa Moore
Rachel Heinze
Mary Hatfield
MRCI - Eugene, OR
(541)484-7256
http://www.mrci.com
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SEASONAL TENDENCIES ARE A COMPOSITE OF SOME OF THE MORE CONSISTENT
COMMODITY FUTURES SEASONALS THAT HAVE OCCURRED OVER THE PAST 15 YEARS.
THERE ARE USUALLY UNDERLYING FUNDAMENTAL CIRCUMSTANCES THAT OCCUR
ANNUALLY THAT TEND TO CAUSE THE FUTURES MARKETS TO REACT IN A SIMILAR
DIRECTIONAL MANNER DURING A CERTAIN CALENDAR PERIOD OF THE YEAR. EVEN
IF A SEASONAL TENDENCY OCCURS IN THE FUTURE, IT MAY NOT RESULT IN A
PROFITABLE TRANSACTION AS FEES, AND THE TIMING OF THE ENTRY AND LIQUIDATION
MAY IMPACT ON THE RESULTS. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT
HAS IN THE PAST OR WILL IN THE FUTURE ACHIEVE PROFITS UTILIZING THESE
STRATEGIES. NO REPRESENTATION IS BEING MADE THAT PRICE PATTERNS WILL RECUR
IN THE FUTURE. HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS,
SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE
THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR
TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN
HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY
ACHIEVED BY ANY PARTICULAR TRADING PROGRAM. ONE OF THE LIMITATIONS
OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY
PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL
TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD
CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING.
FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR ADHERE TO A PARTICULAR TRADING
PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY
AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE
MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH
CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS
AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS. RESULTS NOT ADJUSTED
FOR COMMISSION AND SLIPPAGE.
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Please Remember: These are NOT trading recommendations.
They are provided for information purposes only and
are intended only as potential ideas based on the market's
own performance in the past, but past performance is
not necessarily indicative of future results. Futures
trading involves substantial risk of loss.
Copyright © 2009 Moore Research Center, Inc.
No part of this may be retransmitted without
written permission.
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