How did you come by developing Boomerang?

I’ve been trading for over 15 years and have tried many different methods and systems. Some were overly complicated and some were overly simple.  Traders have strive for their entire careers to discover the “perfect system” for day trading the index markets.

After the internet really took over in 2002 we have seen a plethora of technical indicators. Practically all of them are good in that they serve a particular purpose or give a certain type of reading on the market.  Indicators are just that….tools to read or perceive something about the market action.

Boomerang Scalp Trader evolved after I found myself coming back again and again to very simple things. I had come to realize that trading was really not about particular indicators but in becoming experienced with your tools.  That is what Boomerang Scalp Trader is and that includes the handbook which is the most important part.

Boomerang Scalp Trader System and Indicator

What are the drawbacks of “Boomerang” The Scalp Trader?

The so called drawbacks are not necessarily in Boomerang but in the markets themselves.  No system is going to work well in a choppy, go nowhere type market that is trading in an active 3 point range.  You have to adapt when you see that by either standing aside or scalping for just 1.00 on the trades.  Of course that is a modification and logic tells you that the stop would have to be tightened too unless you were a really fast, expert scalper.  If you learn to read the market tape bias as we explain in the manual then you will be able to use Boomerang more effectively.  One aspect of Boomerang that some might consider a “drawback” (I don’t) is when you see an ascending market for example and the Boom bars are off red color with Red Sell arrows coming in.  For an inexperienced trader they may perceive that those are “wrong signals” but if they had read the handbook they would know that these are the algorithms shifting to a sell bias in spite of the market going up.  An experienced trader would see it as a “stand aside and get ready to short” signal.  Again, this is what systems do.  Give you readings that assist you in determining where and how to trade.

Boomerang Scalp Trader System and Indicator

What are the +5/-5 levels on the Boomerang Force Index?

These are levels that I have predetermined from developing this BFI over the years.  When the market is swinging during the day these levels will show over extended energy on the Force Index.   You can look for reversals soon after that usually.  If the market tape bias is one sided bullish or bearish then the prices are going to hang up or down on that +5/-5 level and stay there until that pattern has exhausted itself fully.   We mentioned the 1-2-3 pattern in the blog as a way to determine when that pattern is close to a conclusion.

Boomerang Scalp Trader System and Indicator

Does Boomerang only scalp the markets?

Primarily yes, but Boomerang had a recent webinar with Mohan, talked about how to catch what is sometimes called a “runner”.  That is an extended move beyond our normal 3 point scalp.  I had built this feature into Boomerang by adding the “Trailblazer” line (black) which gives a simple bias reading by watching how the range bars are reacting to that line.  As long as the bars stay in general on the same side of the Trailblazer and the TB holds the Blue Boomerang Bias line, you can hold that trade for a runner which nowadays is usually up to around 6-8 points.

Boomerang Scalp Trader System and Indicator

What is the most difficult thing about trading with Boomerang Scalp Trader?

That is mostly the psychological component of the individual trader. If they are not experienced with scalping or the high speed of the Emini S&P500 then it can come as a surprise when the market goes into what is called a “fast market”.  In other words, it is human nature that when the market is moving in your direction at top speed and you glance over at your money meter on the trade platform and its soaring you want to hold on.  That is when you should be getting out.  We call these Volume Blasts or Delta Blasts and you need to be liquidating your scalp position into that blast and not waiting for it to “end”.  The so called end is usually a fast reversal fade off the blast back to near break even on your trade which was up 4-5 points at one level.  That can be extremely frustrating for an inexperienced trader especially.  That is why in our manual we recommend a specific setup on Ninja that automatically scalps the trade out at +3.00 gains.  Sometimes inexperienced traders will tell us there is something wrong with Boomerang …because they didn’t get out fast enough. As mentioned, it’s a psychological issue which is due to inexperience in scalping the Emini S&P500.

Boomerang Scalp Trader System and Indicator

Are there any closing thoughts about Boomerang?

As the developer I looked around for some time on how to approach the market. Then I discovered Adam over at Indicator Warehouse.  He is really a professional that knows his stuff and is an honest business man.  I told him I wanted to offer a really superior trading system I had developed for a very low cost. I guess I was getting tired of seeing these overpriced and hyped systems and courses.  So I told him to make it really affordable so traders could have this excellent system that I have used for years at a much lower cost then what is out there and with all the super cool Ninja features.  I said if you do that I will follow up with great trading manual and free blog so that traders could learn to trade with it at the bare bones cost to them.  That was my goal and so far we have accomplished that. I may take Boomerang Scalp Trader off the market anytime as I don’t want it to become too popular of a tool that is altered by excessive volume at the signals it gives.  That would take thousands of contracts so it’s not a big concern, but I am keeping my eye on it.

Boomerang Scalp Trader System and Indicator

July 1st, 2009

If you like this newsletter, you will love “Commodity Options”.  Look for great deals on Carley’s book through Amazon!

Stocks tepidly higher in pre-employment report trade

The day was chock full of mixed economic data, but equities found a way to trade higher.  Coming into the day, statistics pointed toward a positive trading session as the first trading day in July has historically had good outings.  Not surprisingly, it seems as though mutual funds were on the buy side of the markets in early to mid-session trade; however, the buying quickly dried up.

Richard E. Cripps, chief market strategist for Stifel Nicolaus commented on the day’s action, “Some of the buying that wasn’t’ done yesterday is being done today,” he added, “I’m a little surprised.  There isn’t a lot of convincing volume here to read too much into this.”

News on the day included ADP’s prediction of tomorrow’s employment report.  According to the payroll firm, the U.S. economy has lost over 470,000 jobs in the most recent month.  Most analysts are expecting the government to report a number closer to 400,000.  The ISM manufacturing index was reported slightly better than expected and so were pending home sales.  The mixed news puts even more emphasis on tomorrows data.

It was apparent from the “get-go” that many traders have already begun their long holiday weekend.  Those that did stick around for today’s session, will likely make their departure after tomorrows employment report.  Accordingly, tomorrow will likely see very little trading volume; scaling back on your trading is recommended.

Going into tomorrow, we aren’t taking any bold stances.  It seems as though there are equally likely odds that the market will go down tomorrow as there are that it will go up.  On a larger scale, we see resistance near 950 and support at 890 in the S&P with the 920 area as the pivot…If we had to pick a direction, we would say lower from here, but we wouldn’t be willing to put much more on the line than a friendly bet between friends.

Likewise, we see strong resistance in the Russell near 535 and support at 487 but have little opinion as to what the next day or two will bring.  Resistance in the NASDAQ should be found near 515 and support at 1417.

If you have missed this newsletter in recent days, we apologize for the inconvenience.  Unfortunately, we have limited time and sometimes have to prioritize.  Keep in mind that clients of DeCarley Trading were, and are always, welcome to contact us for guidance above and beyond this newsletter.  If you aren’t already trading with us, perhaps you should be.

* Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data.  However, market analysis and commentary does.  Charts provided by Track ‘n Trade, Gecko software.

**Seasonality is already be factored into current prices, any references to such does not indicate future market action.

Please note: A mini S&P chart is used because it is better for charting purposes, but trade recommendations are based the full sized S&P unless otherwise noted.

S&P 500 Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Russell Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Please note: A mini-NASDAQ chart is used because it is better for charting purposes, trade recommendations will denote whether a mini or full sized contract should be used.

NASDAQ Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

————

Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
cgarner@DeCarleyTrading.com
1-866-790-TRADE
Local : 702-947-0701

www.CarleyGarnerTrading.com
www.DeCarleyTrading.com

*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.

There is substantial risk of loss in trading futures and options.

Past performance is not indicative of future results.  The information and data in this report were obtained from sources considered reliable.  Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities.  Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Tuesday, 6.30.09

Jim Wyckoff, Senior Analyst, TraderPlanet.com, LLC

OVERNIGHT/EARLY MORNING DEVELOPMENTS

There is no standout market feature in quieter overnight/early morning trading today.

JIM’S MARKET THOUGHT OF THE DAY *

It’s an important time for the grain futures markets. Traders today get the latest USDA projections on supply, demand and planted acreage in the U.S. This USDA report is one of the more important grain market reports of the year. The calendar turns to July on Wednesday. That month is the generally the hottest of the year for the Corn Belt, and when rains can become less plentiful in the region. July is when the corn crop progresses through the key pollination stage. Trading next week could be the most important trading week of the year for grains. History shows that existing price trends in grain futures can be reversed the first trading week after the U.S. Independence Day holiday, or can accelerate. –Jim

U.S. STOCK INDEXES

The U.S. stock indexes are firmer in early morning trading today. Trading is choppy and lackluster heading into mid-summer. Bulls and bears are still fighting for near-term technical control, with neither able to sustain a price trend the past six weeks.

September S&P 500: The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Today, shorter-term technical support comes in at Monday’s low of 907.40 and then at 900.00. Sell stops likely reside just under those levels. Upside resistance for active traders today is located at the overnight high of 925.00 and then 935.00. Buy stops are likely located just above those levels. Wyckoff’s Intra-day Market Rating: 5.5

Today’s key near-term Fibonacci support/resistance level: 925.00.

PIVOT POINT LEVELS FOR SEPTEMBER S&P 500:

Pivot:————- 917.55

1st Support:——– 911.10

2nd Support:——– 900.95

1st Resistance:—– 927.70

2nd Resistance:—– 934.20

Nasdaq Index: The shorter-term moving averages (4- 9-and 18-day) are neutral early today. The 4-day moving average is above the 9-day and 18-day. The 9-day average is below the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical support is located at the overnight low of 1,475.00 and then at 1,464.00. Sell stops likely reside just below those levels. On the upside, short-term resistance is seen at Monday’s high of 1,493.00 and then at 1,500.00. Buy stops are likely located just above those levels. Wyckoff’s Intra-Day Market Rating: 5.5

Today’s key near-term Fibonacci support/resistance level: 1,473.00

PIVOT POINT LEVELS FOR NASDAQ:

Pivot:———— 1,480.20

1st Support:—— 1,467.35

2nd Support:—— 1,453.20

1st Resistance:— 1,494.35

2nd Resistance:— 1,507.20

September Dow: Sell stops likely reside just below support at 8,400 and then more stops just below support at Monday’s low of 8,373. Buy stops likely reside just above shorter-term technical resistance at 8,500 and then at 8,550. Shorter-term moving averages are bearish early today, as the 4-day moving average is below the 9-day and 18-day. The 9-day moving average is below the 18-day moving average. Shorter-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Wyckoff’s Intra-Day Market Rating: 5.5

Today’s key near-term Fibonacci support/resistance level: 8,512

PIVOT POINT LEVELS FOR SEPTEMBER DOW:

Pivot:———— 8,436

1st Support:—— 8,395

2nd Support:—— 8,331

1st Resistance:— 8,500

2nd Resistance:— 8,541

U.S. TREASURY BONDS AND NOTES

U.S. T-Bonds and T-Notes are firmer in early trading today. The bulls have gained near-term technical momentum recently.

September U.S. T-Bonds: Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day and 18-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical support lies at the overnight low of 118 13/32 and then at Monday’s low of 118 1/32. Sell stops likely reside just below those levels. Shorter-term technical resistance lies at 119 even and then at 119 16/32. Buy stops likely reside just above those levels. Wyckoff’s Intra-Day Market Rating: 5.5

Today’s key near-term Fibonacci support/resistance level: 118 11/32

September U.S. T-Bonds

138 27/32–lifetime high

122 11/32–Previous Month’s high

121 31/32–100-day moving average

119 22/32–second pivot point resistance

119 4/32–first pivot point resistance

119 4/32–previous day’s high

118 19/32–previous day’s close

118 19/32–pivot point

118 1/32–first pivot point support

118 1/32–previous day’s low

117 30/32–4-day moving average

117 16/32–second pivot point support

116 24/32–9-day moving average

115 12/32–18-day moving average

114 12/32–previous month’s low

110 8/32–lifetime low

September U.S. T-Notes: Shorter-term oscillators (RSI, slow stochastics) are neutral early today. Buy stops likely reside just above shorter-term technical resistance at Monday’s high of 116.23.0 and then at 117.00.0. Shorter-term moving averages are bullish early today. The 4-day moving average is above the 9-day. The 9-day is above the 18-day moving average. Sell stop orders are likely located just below support at the overnight low of 116.07.0 and then at 116.00.0. Wyckoff’s Intra Day Market Rating: 5.5

Today’s key near-term Fibonacci support/resistance level: 116.20.0

September U.S. T-Notes

125 24/32–lifetime high

120 14/32–previous month’s high

119 5/32–100-day moving average

117 1/32–second pivot point resistance

116 25/32–first pivot point resistance

116 23/32–previous day’s high

116 16/32–previous day’s close

116 14/32–pivot point

116 6/32–first pivot point support

116 4/32–previous day’s low

116 3/32–4-day moving average

115 27/32–second pivot point support

115 13/32–9-day moving average

115 12/32–previous month’s low

114 24/32–18-day moving average

109 –lifetime low

CURRENCIES

The September U.S. dollar index is weaker in early trading today. Trading has turned choppy, but bears still have the overall near-term technical edge. Slow stochastics for the dollar index are bearish early today. The dollar index finds shorter-term technical resistance at the overnight high of 80.05 and then at 80.50. Shorter-term support is seen at the overnight low of 79.69 and then at 79.50. Today’s key near-term Fibonacci support/resistance level: 80.42. Wyckoff’s Intra Day Market Rating: 4.0

The September Euro is firmer in early electronic trading. Prices hit a fresh three-week high overnight. Bulls have the overall near-term technical advantage. Euro finds sell stop orders are likely located just below technical support at the overnight low of 1.4066 and then at 1.4000. Shorter-term technical resistance for the Euro is seen at the overnight high of 1.4149 and then at 1.4200. Buy stops likely reside just above those levels. Slow stochastics for the Euro are still bullish early today. Today’s key near-term Fibonacci support/resistance level: 1.4098. Wyckoff’s Intra Day Market Rating: 6.0

GOLD

Gold is near steady in early dealings today. Bulls have gained some fresh upside technical momentum, but need to show more power soon to keep it. For August gold, shorter-term technical resistance is seen at the overnight high of $945.40 and then at last week’s high of $949.00. Buy stops likely reside just above those levels. Sell stops likely reside just below support at the overnight low of $937.80 and then at Monday’s low of $933.60. Today’s key near-term Fibonacci support/resistance level: $930.00. Wyckoff’s Intra-Day Market Rating: 5.0

CRUDE OIL

Crude oil prices are slightly higher early today, but have backed well down from the overnight high. Bulls still have the overall near-term technical advantage. In August crude, look for buy stops to reside just above resistance at $72.00 and then just above resistance at $72.50. Look for sell stops just below technical support at the overnight low of $70.95 and then more sell stops just below support at $70.00. Today’s key near-term Fibonacci support/resistance level: $71.10. Wyckoff’s Intra-Day Market Rating: 5.0

GRAINS

Prices were firmer in overnight trading, on position evening ahead of this morning’s key USDA report. Grain bulls are still fading. Weather in the Corn Belt at present is still deemed bearish for corn and soybeans, and for wheat. Remember that the first trading day after the Fourth of July holiday weekend, which is Monday, July 6, will be a very critical trading day in the grains.

The S&P futures are performing nicely Monday morning as they attempt to create separation between price and our near-term downtrend lines.  The S&P futures could have a little upward mobility today should they clear our 1st tier resistance.  The next pit-stop would likely be near our 3rd tier uptrend line and our 935.5 resistance.  We are uncertain where the S&P is getting its positive momentum from today other than China’s sudden reaffirmation that it plans no immediate, large-scale exit from the Dollar.  This rhetoric is a complete reversal from last week’s call for a new global monetary standard.  Sifting through the confusion, it seems China is saying it’s sticking with the Dollar for the near-term, yet is planning to diversify its longer-term reserve composition.

Regardless, China’s newest statement is having a stabilizing effect on U.S. Treasuries, which is comforting to inventors.  Speaking of Treasuries, the 30 Year T-Bond futures have posted encouraging gains over the past 10 days in reaction to substantial demand at recent auctions.  As a result, yields have declined to more respectable levels, temporarily easing investor concerns surrounding the impact of rising rates on a fragile U.S. economy.  Therefore, rising/stable Treasury prices are having a positive impact on equities, a 360 from the pre-crisis days.

Putting this week’s positive start aside, the real game changer will be the flood of economic data beginning with tomorrow’s consumer confidence and Chicago PMI data points along with Japan’s Tankan manufacturing index.  Investors are still attempting to gauge where the economic recovery stands while trying to set a bar for future corporate performance.  Although current moment lies in the bulls’ corner, there’s a new downward force holding down price.  Hence, the markets may continue their relative sideways movements until investors get more concrete economic data and corporate earnings.  With important economic data on the way, the ingredients are on the table for investors to finally make a new directional commitment.  We recognize the same indecisiveness in the GBP/USD, EUR/USD, USD/JPY, gold and crude.  Therefore, we will monitor the performance of the S&P’s correlations for any directional indication.

Present Price: 922.25

Resistances: 923, 931, 935.5, 941.5, 947

Supports: 918.75, 910.75, 902, 895.25, 888.75

Psychological: 900

Disclaimer: FastBrokers’ market commentary is provided for information purposes only and under no circumstances should be regardedneither as an investment advice nor as a solicitation or an offer to sell/buy any financial product. FastBrokers assumes no responsibility or liability from gains or losses incurred by the information herein contained.

Risk Disclosure: There is a substantial risk of loss in trading futures and foreign exchange. Please carefully review all risk disclosure documents before opening an account as these financial instruments are not appropriate for all investors.

“Commodity Options” is now available at TradersLibrary.com!

Stocks soar, but tomorrow may be different

After what seemed to be a quiet open, trade quickly turned into a mass of buy programs.  According to our sources, short covering triggered buy stops then the sharp reversal triggered technical buy programs…and the rest is history.

The buying was said to be attributable to homebuilder and retail stocks.  Homebuilding shares benefited from an announcement by Lennar Corporation reporting that orders for new homes had jumped 63% during the second quarter.  Bed Bath & Beyond gave a boost to customer discretionary stocks after reporting that its first quarter profit climbed 14% thanks to overflow business from rival Linens N Things.

On the economic front, claims for unemployment benefits rose by 15,000 to 627,000 last week.  More significantly, 1st quarter GDP was reported at a negative 5.5%.  The print was better than expected but didn’t paint a positive picture for the economy.

Some of the market volatility was likely due to the day’s events in Washington.  Ben Bernanke spent the day being questioned by Congress in regards to the Bank of America Merrill Lynch deal that cost taxpayers $20 billion.  The Fed chair claims, “I did not tell Bank of America’s management that the Federal Reserve would take action against the board or management”, in regards to questions regarding the “forced” merger of the firms.

In our last newsletter we mentioned that the S&P can bounce as high as 920 without compromising the bears.  Today’s high of 917ish was significant, and while a retest of the highs and maybe even 921 are possible in Friday’s session we feel as though failure to close above these levels will lead to another wave of selling going into next week.
We see strong resistance in the Russell near 507 and 8,544 in the Dow.  The NASDAQ remains the strongest of the major indices, but we see resistance near 1482.

This report was written a little earlier than usual, but the analysis should still be relatively current.  I am speaking at a CFA (Certified Financial Analyst)  event tonight, so time is a little scarce.

* Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data.  However, market analysis and commentary does.  Charts provided by Track ‘n Trade, Gecko software.

**Seasonality is already be factored into current prices, any references to such does not indicate future market action.

Please note: A mini S&P chart is used because it is better for charting purposes, but trade recommendations are based the full sized S&P unless otherwise noted.

S&P 500 Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Russell Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Please note: A mini-NASDAQ chart is used because it is better for charting purposes, trade recommendations will denote whether a mini or full sized contract should be used.

NASDAQ Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

————————-

Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
cgarner@DeCarleyTrading.com
1-866-790-TRADE
Local : 702-947-0701

www.CarleyGarnerTrading.com
www.DeCarleyTrading.com

*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.

There is substantial risk of loss in trading futures and options.

Past performance is not indicative of future results.  The information and data in this report were obtained from sources considered reliable.  Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities.  Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

June 22nd, 2009

“Commodity Options” is now available at TradersLibrary.com!

Optimism wanes on Wall Street

Sharp selling in the commodity markets forced stock investors to reconsider their positions.  Crude oil tumbled over $3 per barrel at one point on Monday after the World Bank reported that they expect the global economy to shrink by 2.9% this year.  In March, the organization believed that the economy would shrink at a pace of 1.7%.  The World Bank also stated that it believed that global trade would plunge by 9.7% in 2009.  The waned confidence quickly dominated trade in stock index futures and once the tone was set, there was no going back.

According to Peter Cardillo of Avalon Partners Inc., “Stock investors want to see stability in commodity prices, not a surge or a tumble.”  The logic being that sharp rise, although suggests confidence in the economy, has the potential to pinch consumers.  On the other hand, a sharp drop in commodity prices suggests weak global demand and more importantly expectations for a sluggish recovery.  He added, “You need a balancing act within the commodity markets.”  Clearly, today’s commodity trade was highly imbalanced.  Along with plunging crude prices, soybean futures dropped by about a quarter per bushel on the session and silver fell nearly half of a buck.

The recent pullback in equities was long overdue.  Last week’s negative showing was the first of its kind in over a month.  Price digestion is imperative for a healthy bull.  That said, we don’t think that the selling is over.  As mentioned in last week’s newsletter, we think that the S&P could be headed toward the mid-to-high 870’s but keep in mind that if investors begin to panic, the liquidation could result in a quick move to the mid 800’s.  For now, we are planning on being bullish near 875.

We see support in the Russell near 485 but think that we will see the low 470’s again at some point this week or next.  The once resilient NASDAQ seems destined for 1401.

* Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data.  However, market analysis and commentary does.  Charts provided by Track ‘n Trade, Gecko software.

**Seasonality is already be factored into current prices, any references to such does not indicate future market action.

Please note: A mini S&P chart is used because it is better for charting purposes, but trade recommendations are based the full sized S&P unless otherwise noted.

S&P 500 Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Russell Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Please note: A mini-NASDAQ chart is used because it is better for charting purposes, trade recommendations will denote whether a mini or full sized contract should be used.

NASDAQ Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

———–
Carley Garner

Senior Analyst / Commodity Broker

DeCarley Trading

cgarner@DeCarleyTrading.com

1-866-790-TRADE

Local : 702-947-0701

www.CarleyGarnerTrading.com

www.DeCarleyTrading.com

*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.

There is substantial risk of loss in trading futures and options.

Past performance is not indicative of future results.  The information and data in this report were obtained from sources considered reliable.  Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities.  Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

The S&P futures are drifting lower after the World Banks slashed its expectation for global growth.  It appears as if the futures are in for another retest of 900.  U.S. equities may be giving into their downtrend tendencies as market sentiment turns sour.  Hence, the sideways trading range may finally break with investors deciding upon a direction.  However, 900 is a tricky level, and 880-900 should prove to be a worthy near-term ally of the bulls.  Economic data continues to come in mixed and it remains to be seen whether the economic stabilization can materialize into a recovery.  There are a couple psychological factors impacting the market, particularly political tensions in Iran and North Korea.  While these political problems are certainly applying some immediate-term downward pressure, we don’t expect either to have a lasting influence unless they result in nuclear warfare or a large constraint in the supply of crude.  The largest downward force on the S&P is the fact that equities have rallied so strongly thus far this year.  As a result, equities appear overvalued and in need of a healthy pullback.  The psychological forces attacking the market today could provide the fuel for a sizeable retreat in the S&P as investor uncertainty rises.

The most disconcerting development concerning the present state of U.S. equities is the negative performance of gold and crude.  Gold has just dropped below important supports.  The precious metal has been a leading indicator for equities lately, foreboding a similar pullback in the S&P.  Additionally, crude futures have fallen beneath their first tier trend line and are trading back below $70/bbl.  Meanwhile, the EUR/USD and USD/JPY are at critical junctures while continually indicating a preference for their respective downtrends.  Altogether, the S&P’s correlations support an environment for a sizable downturn in U.S. equities.  Therefore, we maintain our negative near-term outlook on the S&P futures.  The key for the S&P in the near-term will be staying above our 1st tier downtrend line and May lows.  If these two technical defenses don’t hold, the present pullback in the S&P could pick up speed.

Present Price: 902.50

Resistances: 906.75, 914, 922, 927, 935.5

Supports: 897.50, 890, 878, 873, 864.25

Psychological: 900, 950

Disclaimer: FastBrokers’ market commentary is provided for information purposes only and under no circumstances should be regardedneither as an investment advice nor as a solicitation or an offer to sell/buy any financial product. FastBrokers assumes no responsibility or liability from gains or losses incurred by the information herein contained.
Risk Disclosure: There is a substantial risk of loss in trading futures and foreign exchange. Please carefully review all risk disclosure documents before opening an account as these financial instruments are not appropriate for all investors.

The S&P futures continue to creep further away from our uptrend lines as the bulls fight to avoid a retest of 900.  The further our uptrend lines drift away, the more likely we are to see a sizeable pullback.  On a positive note, buyers were able to keep the S&P at a reasonable level despite a report showing a decline in consumer prices in addition to Standard and Poors slashing its ratings on 22 U.S. banks.  While considerable hope remains that the U.S. economy is on the path to recovery, investors can’t ignore that equities have made an incredible run thus far this year.  Therefore, the question becomes whether U.S. equities are trading at fair value.  We believe the impact of the economic crisis on future corporate earnings hasn’t been fully realized.  As a result, investors may be pricing in a recovery based on historical precedents rather than reality.  Hence, the debate among investors continues, creating the relatively narrow trading range we’ve witnessed over the past 10 weeks.  Meanwhile, the 900 area should prove to be a worthy battle ground.  Investors should keep an eye on the S&P’s interaction with our newly formed 2nd tier downtrend line along with our 1st tier downtrend line.  Any decline beneath our 1st tier downtrend line could result in considerable losses.  Luckily for bulls, today’s Philly manufacturing index came in well above analyst expectations, reinforcing the viability of an economic recovery.

Indicator wise, all of the S&P’s correlations are recovering or consolidating while maintaining their near-term downward pressure.  The correlations show investors are considering sending U.S. equities into another leg down, yet investors aren’t ready to commit since a medium-term uptrend is in play.  However, inflection points are approaching in both the EUR/USD and GBP/USD while gold trades just above important uptrend lines.  Hence, even though the market may choose to consolidate over the immediate term, it seems a breakout point is approaching.  Therefore, investors shouldn’t get too comfortable since we believe volatility could pick up shortly.

Present Price: 919.00

Resistances: 918, 927, 933.75, 939.50, 945.75, 952

Supports: 914, 906.75, 897.50, 890, 878

Psychological: 900, 950

Disclaimer: FastBrokers’ market commentary is provided for information purposes only and under no circumstances should be regardedneither as an investment advice nor as a solicitation or an offer to sell/buy any financial product. FastBrokers assumes no responsibility or liability from gains or losses incurred by the information herein contained.

Risk Disclosure: There is a substantial risk of loss in trading futures and foreign exchange. Please carefully review all risk disclosure documents before opening an account as these financial instruments are not appropriate for all investors.

R.B.I. Trader’s Update

6 / 16 / 2009

(Published Since 1996)

The market opened higher on Tuesday and the early strength was sold as the ES backed away from the 924.00 level. A pullback to 919.25 was bought, and the market tested its highs. After getting turned away from 924.00 for the forth time, the market finally broke lower and a little bit of panic selling hit the market. The ES bounced off of the 908 support level, but failed at the 912 updated resistance area and then the market fell to new lows for the day. The ES reached 906.50 before reversing, and then bounced to the 60ema on the 5 minutes chart before the move fizzled out.
With the trends and momentum favoring the bears, the move was sold and the market fell into the close.

The daily internal gauges all look worse than prices do at this time. The short term overbought/oversold indicators are now at an extreme. In addition, the Vix jumped another 6% on Tuesday and is set to give several buy signals if it reverses. So, unless things are really bad, then this current selloff should be near a low that gives us a decent oversold bounce. The market looks like it wants to go lower first, but a reversal from the 900 area should set up a trade on the long side. It would also fit the quarterly expiration games, if they take them down then run them up at the end of the week.

We get the CPI before the open on Wednesday. If the market opens higher, it’s a short as soon as the move stalls/reverses. If there is follow through selling and the ES goes down to the 902.00-900.50 zone in the first 20-40 minutes and then turns up, it should be the start of a decent rebound. However, if the market gets down there and can not get turned back up, then the market is in for another bad day. The first good bounce will likely be sold if the move doesn’t have much gusto, so beware of a wimpy rally reversing.

Good Trading,

Mike Reed

Copyright (c) 2009 by TradeStalker.com, Ft Wayne, IN.

TradeStalker Updates may not be redistributed without permission.

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Disclaimer

The financial markets are risky. Investing is risky.

Past performance does not guarantee future performance.

The foregoing has been prepared solely for informational purposes and is not a solicitation, or an offer to buy or sell any security. Opinions are based on historical research and data believed reliable, but there is no guarantee that future results will be profitable.

We are not advocating trading futures. The prices and contracts in the TradeStalker Updates specify a manner in which you could trade. We occasionally mention the SP500 and Nasdaq futures markets because it is extremely liquid and tends to lead the other markets.

This is not an endorsement or recommendation of the SP500 and Nasdaq futures markets. The risk of loss in futures is substantial. You can lose more than your original investment. We are not Registered Investment Advisors or Commodity Trading Advisors.

June 16th, 2009

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VIX in the spotlight again

A positive reading on housing starts and building permits triggered a small wave of early morning buying but overseas weakness and mixed economic news prevented the move from becoming more than an oversold bounce.

We mentioned last week that the stagnant volatility wasn’t going to last.  This week it seems as though traders are embracing it.  According to our sources, speculators and even large investment houses were getting on the long side of volatility through the purchase of VIX call options and call spreads.  Buyers are using the August and September options, meaning that they think that it could be a rough summer for equities.  This is something that we have suspected as well, but the relentless early summer trade has proven many wrong thus far.

Coming into today, we were expected a decent sized bounce from what we had deemed to be considerably support on the daily chart.  However, the upside momentum was a disappointment and the S&P has settled beneath our critical pivot level of 917.  This leaves us on the fence in terms of near-term direction.

If you are trading the S&P, look for weakness to continue as long as the market closes beneath 917.  Above such areas, however, the bulls may have an edge.  Major resistance lies at 957 and support at 877.  We will refrain from making any bold calls until things clear up a bit.

The NASDAQ on the other hand, managed to remain above its major pivot area near 1445.  If tech stocks are still the leader, this may be significant for the bulls.  In the meantime, intermediate term resistance can be found near 1538 and support near 1350.  The “make or break” area for the Russell appears to be 504.

* Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data.  However, market analysis and commentary does.  Charts provided by Track ‘n Trade, Gecko software.

**Seasonality is already be factored into current prices, any references to such does not indicate future market action.

Please note: A mini S&P chart is used because it is better for charting purposes, but trade recommendations are based the full sized S&P unless otherwise noted.

S&P 500 Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Russell Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Please note: A mini-NASDAQ chart is used because it is better for charting purposes, trade recommendations will denote whether a mini or full sized contract should be used.

NASDAQ Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

————

Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
cgarner@DeCarleyTrading.com

1-866-790-TRADE
Local : 702-947-0701

www.CarleyGarnerTrading.com
www.DeCarleyTrading.com

*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.

There is substantial risk of loss in trading futures and options.

Past performance is not indicative of future results.  The information and data in this report were obtained from sources considered reliable.  Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities.  Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.