TheStrategyLab.com Price Action Trading Support Forum

Today's trades that were posted in real-time in #FuturesTrades chat room via my IRC user name wrbtrader. You can review each trade from entry to exit along with commentary and an occasional trading tip because its all archived @ http://www.thestrategylab.com/ftchat/forum/viewtopic.php?f=66&t=329



FYI - You can ask me questions here at the forum or you can tweet me on twitter about anything related to today's trading or related to your own trading.

@ http://twitter.com/wrbtrader

In addition, posted below are direct links about my trade methodology or trading approach that enables me to identify key trading areas in the price action that represent changes in supply/demand along with being able to exploit the changes in supply/demand.

http://www.thestrategylab.com/WRBAnalysisTutorials.htm

http://www.thestrategylab.com/TradeStrategies.htm

Also, I strongly believe that profitable trading involves more than just trade signals and that's why most traders fail because they put all their efforts in trade signals while ignoring the impact on their trading results via market psychology, trader psychology (trading habits/routine and personal lifestyle). If you don't understand this perspective...please ask questions here at the forum for more info or you can tweet me on twitter @wrbtrader.

My Trading Performance: +5.25 Emini ES ($ES_F) points


------------------------------

Stocks Jump Again
Weaker dollar and Australian rate hike spur investors, with the Dow posting a triple-digit gain for the second straight day.
By Alexandra Twin, CNNMoney.com senior writer
Last Updated: October 6, 2009: 4:20 PM ET

NEW YORK (CNNMoney.com) -- Wall Street rallied Tuesday, gaining for a second session as a weaker dollar boosted commodities and dollar-sensitive stocks, fostering a broad-based rally.

The Dow Jones industrial average (INDU) rose 132 points, or 1.4%, according to early tallies. The S&P 500 (SPX) index gained 14 points, or 1.4%, and the Nasdaq composite (COMP) rose 35 points, or 1.7%.

The runup had been stronger through midday, but lost some steam as the dollar cut losses and financial shares turned mixed to negative.

The stock advance was broad based, with 29 of 30 Dow stocks rising as investors piled into a variety of stocks battered in a two-week selloff. Worries that the rally had gotten ahead of the recovery caused the selloff at the end of the third quarter and start of the fourth.

But that decline of just over 4% on the S&P 500 seemed to give investors the entry point they were looking for to jump back into stocks.

"I think most people believe that stocks are going to generally keep drifting higher for the next few months," said Gary Webb, CEO at Webb Financial Group. "So while nothing fundamental has changed this week, investors are taking opportunities to buy on the lows."

"We've seen a lot of these elevator moments over the last month, these short, sharp pullbacks that ended up bringing people back in," said Fred Dickson, chief market strategist at D.A. Davidson & Co. "That's what we're seeing here."

Investors also welcomed reports that Australia became the first major economy to lift interest rates since the start of the financial crisis.

The falling dollar boosted gold to an all-time high of $1,045 an ounce during the session and $1,039.70 at the close. The weak U.S. currency was also good for the stocks of multi-national companies that benefit from a weaker dollar.

A weaker-than-expected response to a government debt auction dulled some of the shine on the rally.

Economy: An upbeat reading on the services sector of the economy helped spark the advance Monday, but there was little on the docket until Wednesday when readings on consumer credit and the Treasury budget were due.

Seven months and counting: A roughly seven-month-long rally in U.S. stocks petered out late September at the end of an otherwise upbeat third quarter. In the July-September period, the Dow and S&P 500 both rallied 15%, the best quarter in a decade, while the Nasdaq rose 15.7%, its best quarter in six years.

But the selloff was modest amid the broader rally that's been in place since last March. Since bottoming at a 12-year low March 9, the S&P 500 has gained 51.2%, and the Dow has gained 45% as of Monday's close. After hitting a six-year low, the Nasdaq has gained nearly 61%.

On the move: The broad advance benefited a number of stocks and sectors.

Materials and commodities stocks surged, including Dow components Alcoa (AA, Fortune 500), DuPont (DD, Fortune 500), Chevron (CVX, Fortune 500) and Exxon Mobil (XOM, Fortune 500).

The Dow's other biggest gainers were Caterpillar (CAT, Fortune 500), Hewlett-Packard (HPQ, Fortune 500), IBM (IBM, Fortune 500), JPMorgan Chase (JPM, Fortune 500) and United Technologies (UTX, Fortune 500).

Market breadth was positive. On the New York Stock Exchange, winners topped losers by almost four to one on volume of 1.23 billion shares. On the Nasdaq, advancers topped decliners two to one on volume of 2.41 billion shares.

Results due to begin: The third-quarter earnings reporting period unofficially kicks off Wednesday with Alcoa, as is typical. The aluminum maker is expected to post a loss versus a profit a year ago, demonstrating the weak quarter expected for the materials sector.

S&P 500 profits are expected to have dropped almost 25% from the third quarter of 2008.

Company news: Boeing (BA, Fortune 500) said it will take a $1 billion charge in the third quarter because of higher costs to produce its 747-8 airplanes, and the rough market conditions. The stock was little changed and was the only Dow stock not to advance.

World markets: Global markets rallied after Australia became the first major economy to boost interest rates since the financial crisis began. Australia's central bank boosted its overnight lending rate by a quarter percentage point to 3.25%, saying it was time to start taking away the stimulus of low rates as the economy is no longer weakening.

In Europe, London's FTSE 100, France's CAC 40 and Germany's DAX all gained over 2%. Asian markets ended higher.

Currency and commodities: The dollar tumbled versus the euro and the yen, resuming its recent plunge against a basket of currencies.

U.S. light crude oil for November delivery settled up 47 cents to $70.41 a barrel on the New York Mercantile Exchange.

COMEX gold for December delivery rose $21.90 to settle at a record $1,039.70 an ounce, after rising as high as $1,045, an intraday record. The previous record close of $1,020.20 was set two weeks ago.

Bonds: Treasury prices fell, raising the yield on the 10-year note to 3.24% from 3.22% late Monday. Treasury prices and yields move in opposite directions.

The government saw good, but not great, demand for its auction of $39 billion in 3-year notes. Treasury said the bid-to-cover ratio, which measures demand, was 2.76, short of the 3.02 ratio seen the last time it sold 3-year notes.



Yahoo! Finance

4:30 pm : Despite a downward drift in afternoon action, stocks were able to march considerably higher in broad-based fashion for the second straight session as overseas gains and a weaker U.S. dollar kept buyers in the market.

The major indices started markedly higher as the previous session's gains were extended amid news that by Australia's Reserve Bank hiked its key lending rate by 25 basis points to 3.25%. Though the rate hike may strike some as an unlikely impetus for higher stock prices, global participants were encouraged by the symbolism of the act, since it suggests that the global economy has strengthened. That consideration helped drive the Dow Jones World Index to a 1.9% gain, which is its best percentage gain in two months.

Weakness in the U.S. dollar continues to bode well for stocks, especially for shares of multinationals. The Dollar Index dropped 0.5% this session, but it is still trading above its 2009 lows.

Commodities were helped considerably by the dollar's decline. In turn, the CRB Commodity Index tacked on 1.3%. Gold was one of the best performing assets this session. It spiked to a record intraday high of $1045 per ounce, before it settled with a 2.2% gain at a record closing high of $1039.70 per ounce.

The dollar's drop and gold's gains helped materials stocks show leadership in the early going, but as the greenback pared its losses midsession and pulled the materials sector back from its near 3% gain, the broader market drifted off of its midday highs. A pullback by financials, which were leaders in the previous session, also undercut the broader market. Goldman Sachs (GS 186.98, +0.51) weighed considerably on the sector as participants pressured the stock in high volume.

However, the stock market was able to recover from the afternoon drift as materials stocks and financial stocks rebounded. Materials stocks settled with a 1.9% gain, while financials finished 1.2% higher. That helped the stock market finish on a relatively positive note and book a two-session gain of 2.9%, its best back-to-back performance in more than one month.

There weren't any economic releases this session and only a handful of companies made announcements ahead of earnings season's start tomorrow night. Participants had little reaction to results from an auction 3-year Treasuries. Key tests of interest will come later this week with the auctions of 10-year Notes and 30-year Bonds.

Advancing Sectors: Energy (+2.1%), Materials (+1.9%), Tech (+1.9%), Consumer Discretionary (+1.5%), Telecom (+1.2%), Financials (+1.2%), Industrials (+1.1%), Consumer Staples (+0.9%), Health Care (+0.8%), Utilities (+0.7%)
Declining Sectors: (None)DJ30 +131.50 NASDAQ +35.42 NQ100 +1.8% R2K +1.8% SP400 +1.4% SP500 +14.26 NASDAQ Adv/Vol/Dec 2007/2.42 bln/675 NYSE Adv/Vol/Dec 2414/1.23 bln/621

3:30 pm : Stocks are making a strong recovery off afternoon lows as broad-based gains persist.

A weak dollar has buoyed asset prices across the board this session. Energy and materials stocks have provided considerable strength, helped by the weakness in the dollar. They are up 2.4% and 2.1%, respectively. The dollar index is currently down 0.5% on the session.

Precious metals have been a noticeable beneficiary of the weakness in the dollar since the March lows (along with the rest of the U.S. markets). Gold futures hit an all time high this session at $1045 per ounce. December gold futures finished a strong session at an all time closing high of $1039.70 per ounce, up 2.2%. Gold futures are now up almost 20% since the March lows as the dollar index has fallen greater than 14% over the same period. Silver futures have also risen in the face of the weak dollar. They closed up 4.6% at $17.30 per ounce.

November crude oil managed to post modest gains this session. Still, the 0.7% gain underperformed the gains seen in the broader commodity index. The November crude oil futures closed at $70.88 per barrel after failing to surpass the $72 level late in the morning.

November natural gas futures actually traded lower this session, despite the aforementioned weakness in the dollar. They closed down 2.2% at $4.88 per contract.DJ30 +139.28 NASDAQ +34.38 SP500 +15.03 NASDAQ Adv/Vol/Dec 1894/2.04 bln/774 NYSE Adv/Vol/Dec 2359/900 mln/638

3:00 pm : Stocks are now trying to reclaim the gains that they recently surrendered in a broad-based afternoon decline. Financial stocks cotninue to trade off of their highs, however; the sector is currently up a modest 0.6% as it lags the broader market.

The only other major sectors to trade with comparable gains are the defensive-oriented sectors. As such, health care is up 0.6%, consumer staples are up 0.6%, telecom is up 0.7%, and utilities are up 0.3%.DJ30 +102.25 NASDAQ +24.77 SP500 +10.62 NASDAQ Adv/Vol/Dec 1770/1.87 bln/897 NYSE Adv/Vol/Dec 2204/818 mln/779

2:30 pm : The major indices have extended their decline so that they now trade at their worst levels of the afternoon. Still, stocks are up in broad fashion as more than 75% of the companies listed in the S&P 500 sport gains. Close to 90% of the S&P 500 components had been trading with gains in the early going, though.

This afternoon's decline coincides with a rising U.S. dollar. Though the greenback remains in negative territory, it has managed to make its way off of session lows. In turn, the Dollar Index is now down 0.4%.DJ30 +79.35 NASDAQ +18.31 SP500 +7.88 NASDAQ Adv/Vol/Dec 1675/1.72 bln/966 NYSE Adv/Vol/Dec 2026/756 mln/944

2:00 pm : Stocks continue to pare their gains as they drift off of their highs, which were reached late morning. The steady descent comes as financial stocks hand back a substantial chunk of their gains to now trade with a more modest gain of 0.6% after being up more than 2%.

Materials stocks are also pulling back. The sector was an early leader and had been up roughly 2.8% at its session high, but it is now up 1.3%.

Still, each of the three major indices continues to sport gains of more than 1%. DJ30 +106.63 NASDAQ +27.91 SP500 +12.28 NASDAQ Adv/Vol/Dec 1863/1.53 bln/789 NYSE Adv/Vol/Dec 2295/672 mln/679

1:30 pm : The financial sector has pulled back from a 2.3% gain to trade with a 1.0% gain as shares of Goldman Sachs (GS 186.69, +0.22) make a sharp reversal amid a spike in trading volume. The financial sector was a leader in the broader market during the previous session.

Separately, results from an auction of 3-year Treasuries were solid. The bid-to-cover was nearly 2.8, which is up from the previous average of 2.6. Key tests of interest will come later this week with the auctions of 10-year Notes and 30-year Bonds.DJ30 +128.32 NASDAQ +34.58 SP500 +14.58 NASDAQ Adv/Vol/Dec 1940/1.41 bln/703 NYSE Adv/Vol/Dec 2434/613 mln/537

1:05 pm : Following four straight down sessions, stocks are putting together their best two session advance by percent in more than one month. The extension of the previous session's advance comes largely as a result of strong gains overseas and continued weakness in the U.S. dollar.

Stocks started the session considerably higher, reflecting the broad gains that were registered overseas following the decision by Australia's Reserve Bank to tack on 25 basis points to its key lending rate, which now stands at 3.25%. The rate hike acted as a testament to the notion that the global economy has strengthened since flirting with disaster.

Meanwhile, the U.S. dollar remains mired in weakness, which has proven helpful to multinationals and particularly beneficial to commodities and basic materials stocks. With the Dollar Index down 0.6%, gold prices have climbed to record levels. Gold prices are currently up 2.3% to $1040.50 per ounce after being as high as $1045 per ounce.

Interest in gold has helped send the SPDR Gold Trust (GLD 101.98, +2.16) to its best single session percentage advance in months. Yamana Gold (AUY 11.27, +0.86) is also benefiting from higher gold prices, as well as news that the company's estimated total production for the third quarter of 2009 hit a record high.

Gold's gains and strength in other basic materials stocks have lifted the broader materials sector to a 2.2% gain, despite an earnings miss from Mosaic (MOS 47.95, +1.99).

Energy is currently the best performing sector, though. It is up 2.3% as explorers (+2.7%) and drillers (+3.3%) spike amid a 1.1% gain in oil prices. Contracts for crude are currently trading hands at $71.20 per barrel.

All 10 major sectors in the S&P 500 are still sporting solid gains, but the broader market has eased off of its session highs. Dow component Boeing (BA 52.24, -0.04) has been a laggard for the entire session and a bit of a drag on blue chips. The company announced this morning that it expects a pretax charge against third quarter results of approximately $1.0 billion, or $0.90 per share, due to increased production costs associated with certain production programs. DJ30 +131.35 NASDAQ +34.85 SP500 +14.72 NASDAQ Adv/Vol/Dec 1975/1.31 bln/651 NYSE Adv/Vol/Dec 2451/567 mln/500

12:30 pm : Since easing off of session highs, stocks have started to move sideways as they hold steady to their gains.

Advances throughout Europe were even more impressive during Tuesday's trade. Germany's DAX advanced 2.7%, while France's CAC moved 2.6% higher in its best single session percentage gain in more than one month. Britain's FTSE finished the session with a 2.3% gain.

Strength in the U.S. and overseas has helped the Dow Jones World Index put together a 2.2% gain. That marks its best percentage gain since July.DJ30 +151.37 NASDAQ +38.13 SP500 +17.04 NASDAQ Adv/Vol/Dec 1989/1.17 bln/607 NYSE Adv/Vol/Dec 2557/502 mln/406

12:00 pm : Stocks have drifted off of their session highs, but the continue to sport impressive gains as eight of the 10 major sectors trade with gains of 1% or more.

Meanwhile, the U.S. dollar continues to trade with weakness. In turn, the Dollar Index is down 0.6%, just above its session lows.

Amid the broader market's positive tone, Treasuries have spent the entire sessionin negative territory. The benchmark 10-year Note is down 7 ticks, which has lifted its yield back toward 3.25%.DJ30 +147.44 NASDAQ +36.16 SP500 +16.81 NASDAQ Adv/Vol/Dec 1992/1.06 bln/586 NYSE Adv/Vol/Dec 2560/459 mln/399

11:30 am : All 30 Dow components had been sporting gains, until Boeing (BA 52.24, -0.04) slipped back into negative territory. The stock is trading as a relative laggard following the company's announcement that it expects a pretax charge against third quarter results of approximately $1.0 billion, or $0.90 per share, due to increased production costs and the difficult market conditions affectign its 747-8 program. The company also said that it now expects the first flight of its 747-8 Freighter to occur by early next year.DJ30 +158.48 NASDAQ +39.31 SP500 +18.04 NASDAQ Adv/Vol/Dec 1991/919 mln/541 NYSE Adv/Vol/Dec 2574/403 mln/357

11:00 am : Gold prices continue to push higher. The yellow metal is now being priced at a fresh record high of $1042.80 per ounce, up 2.6%. That has helped drive the SPDR Gold Trust (GLD 102.36, +2.54), to its best single session percentage gain in months.

Meanwhile, the broader market continues to trade near session highs. However, stocks have yet to fully erase the losses that they incurred last week.DJ30 +133.91 NASDAQ +35.36 SP500 +16.22 NASDAQ Adv/Vol/Dec 1941/754 mln/536 NYSE Adv/Vol/Dec 2540/334 mln/357

10:35 am : A weak dollar and news that Australia raised its rates last night are giving a boost to some of the commodity complex. Gold hit all-time highs of $1043.20 per ounce after steadily rising overnight. Currently gold is 2.3% higher at $1041.10 per ounce. December silver is tracking gold, hitting its own highs of $17.335 per ounce in recent trade and currently trading 4.56% higher at $17.30 per ounce.

October crude oil rose steadily in positive territory overnight until hitting session highs of $71.92 per barrel in recent trade. Currently, crude is 1.9% higher at $71.78 per barrel.

October natural gas hit highs this morning of $5.12 per MMBtu and reversed back into negative territory and to fresh lows of $4.902 per MMBtu. Currently natural gas is trading at $4.956 per MMBtu.DJ30 +111.77 NASDAQ +29.90 SP500 +13.52 NASDAQ Adv/Vol/Dec 1868 /610.0 mln/550 NYSE Adv/Vol/Dec 2445/274.5 mln/386

10:00 am : The major indices have extended their opening gains. The positive tone has taken nearly 90% of the stocks listed in the S&P 500 into the green.

What's more, the buying effort comes on the heels of the previous session's 1.5% gain and puts stocks on course to make their best back-to-back performance in more than one month.

Advancing Sectors: Materials (+2.5%), Energy (+1.8%), Financials (+1.8%), Industrials (+1.8%), Consumer Discretionary (+1.6%), Tech (+1.6%), Telecom (+0.9%), Utilities (+0.7%), Consumer Staples (+0.7%), Health Care (+0.5%)
Declining Sectors: (None)

Early Movers: Trading up -- FONR +72.1%, NTRI +21.5%, AVCT +20.8%, SRDX +17.9%, PNX +9.6%, CRUS +9.2%, HRBN +9%, BEE +8.9%, KGN +8.5%, HL +8.5%; Trading down -- VRNMD -26.5%, MNKD -20.4%, EXTR -14.6%, STJ -14%, ARP -11.1%, TINY -10.1%, RBN -8.6%, ARRS -6.5%, ZSL -6.3%, IRET -6.1%DJ30 +121.29 NASDAQ +33.67 SP500 +15.16 NASDAQ Adv/Vol/Dec 1842/372 mln/462 NYSE Adv/Vol/Dec 2414/183 mln/325

09:45 am : Broad-based buying has lifted stocks to a strong start. Gains are especially strong in the materials sector, which is up 2.5% amid higher commodities and basic materials prices. As such, gold continues to glisten as it sports a 1.5% gain at $1032.40 per ounce, near the record high of $1035 per ounce that it set earlier in pit trade.

Health care is the only major sector that has failed to make its way into positive territory, though its loss has been limited. The sector is currently off 0.1% as health care equipment stocks (-2.3%) and managed care stocks (-0.7%) falter. Health care facilities stocks (+1.6%) are providing support, though.DJ30 +97.56 NASDAQ +21.33 SP500 +11.41 NASDAQ Adv/Vol/Dec 1655/209 mln/531 NYSE Adv/Vol/Dec 2226/116 mln/414

09:15 am : S&P futures vs fair value: +8.50. Nasdaq futures vs fair value: +10.00. Stock futures continue to trade with strength as gains from the previous session carryover and overseas markets rally amid news that the Reserve Bank of Australia tacked on 25 basis points to its key lending rate, which now stands at 3.25%. Though many wouldn't expect a rate hike to bode well for stocks, participants are moved more by the symbolism of the hike in that it suggests the global economy has steadied. A weaker U.S. dollar also continues to help prop up stocks, and commodities, too. With the Dollar Index down 0.5% in the early going, crude oil prices are up 1.3% to $71.30 per barrel. Meanwhile, gold prices are up a sharp 1.7% to $1033.70 per ounce. Gold recently registered new record highs by hitting $1035 per ounce.

09:00 am : S&P futures vs fair value: +8.80. Nasdaq futures vs fair value: +10.00. Stock futures have eased back from their morning highs, but they continue to trade with relative strength. Crude oil futures continue to look especially strong. In the first few minutes of pit trade, oil prices are up 1.3% to $71.30 per barrel. According to the EIA, fourth quarter oil demand in the U.S. is expected to drop 1.7% from the previous year. However, T. Boone Pickens stated in a CNBC interview earlier this morning that oil prices will average $80 per barrel next year. Meanwhile, gold prices have built on the previous session's spike to hit fresh 52-week highs. Gold contracts are currently pricing the yellow metal 1.1% higher at $1027.50 per ounce. Prices are still shy of the record $1033.90 per ounce that was reached in the first quarter of 2008. The precious metal's higher price is helping to prop up gold stocks like Yamana Gold (AUY), which is up 4% to $10.82 per share ahead of the opening bell. The company recently stated that its estimated total production for the third quarter of 2009 was a record of approximately 314,200 gold equivalent ounces. That represents 9% and 16% increase from the second quarter and first quarter of 2009, respectively.

08:35 am : S&P futures vs fair value: +9.30. Nasdaq futures vs fair value: +11.80. Europe's major stock indices are pushing higher as Germany's DAX makes its way to a 1.6% gain. Of its 30 members, only Fresenius Medical, Fresenius SE, and Muenchener Rue are trading in the red. In Britain, the FTSE is up 1.5% as nearly 95% of its components sport gains. BP PLC (BP) is a primary leaders, even though analysts at RBS downgraded the stock. According to UK Times Online, the European Commission wants Royal Bank of Scotland to sacrifice up to 10% of its small business customers as the penalty for receiving billions of pounds in state aid. The report also indicated that Lloyds Banking Group (LYG) is under pressure to shrink its share of personal accounts. Separately, The Independent reported that the Financial Services Authority said that banks operating in the UK will be required to hold some 1 billion pounds in government securities to ensure that they have enough liquidity in times of financial stress. In other news, UK Guardian reported that a measure of industrial output, which includes energy production, fell by 2.5% in August. However, UK Telegraph reported that house prices climbed for the third straight month in September. Meanwhile, in France, the CAC is up 1.4% as BNP Paribas and Total (TOT) provide leadership. According to The Wall Street Journal, Societe Generale said it is launching a rights issue to repay state funds. The remainder will be used to buy the 20% stake it doesn't own in its Credit du Nord unit and to boost its capital ratios. Asian stocks fared well in Tuesday's trade. Japan's Nikkei tacked on 0.2% as Tokyo Electron, Shin Etsu Chemical, and Sumitomo moved higher. Financial outfits HSBC (HBC), China Life, and Bank of China helped Hong Kong's Hang Seng climb 1.9%. Hang Seng Bank was a laggard, though. The Shanghai Composite climbed 0.9%.

08:00 am : S&P futures vs fair value: +10.20. Nasdaq futures vs fair value: +13.50. Stock futures are up markedly in the morning following the market's first advance in five sessions. The upbeat tone comes amid strong overseas gains and continued weakness in the U.S. dollar, which is currently off by 0.5% against a basket of major foreign currencies. Additionally, Mosaic (MOS) announced last evening that during the latest quarter it brought in $0.23 per share, but that missed the consensus earnings estimate of $0.35 per share. Still, shares of MOS are up 1.2% to $46.50 per share in premarket trading. This morning, Chattem (CHTT) announced earnings of $1.31 per share for its latest quarter, but that is not immediately comparable to the consensus, which had been pegged at $1.21 per share. Meanwhile, Pepsi Bottling (PBG) reported that it brought in $1.06 per share, which was a penny above the average earnings estimate. Earnings season kicks off Wednesday night when Dow component Alcoa (AA) reports its latest results.

06:20 am : S&P futures vs fair value: +9.10. Nasdaq futures vs fair value: +12.50.

06:20 am : Nikkei...9691.80...+17.30...+0.20%. Hang Seng...20811.53...+382.50...+1.90%.

06:20 am : FTSE...5097.02...+72.60...+1.50%. DAX...5593.87...+85.30...+1.60%.

Go Back To TheStrategyLab.com Homepage