November 8th, 2019 - Issue #989
In This Issue
1. Trading 202: AI App - the concept of Leading and Following Markets.
2. Hot Market Report: Natural Gas - Colder weather brings out volatility
3. Economic Calendar
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1. Trading 202: Price-Driven Trade Ideas - the concept of Leading and Following Markets.
What they are and how you can benefit from them - FREE trial to an AI APP.
At any given time, there are a multitude of factors that impact the markets. They are constantly moving and changing. One way for traders to stay on top of this ever-shifting environment is with Leading and Following Markets.
The fundamental concept of this technology is to identify a market that typically moves in the direction of another market, thus identifying a “leading” and a “following” market. By investing in the “following” market, the trader is able to use the “leading” market as a better indicator of fluctuation than the chaotic markets at large.
Using this strategy can make the whole process seem less like a gamble.
To read the rest of the article as well as a FREE TRIAL to an artificial intelligence APP which scans and provides price driven trade ideas, please fill out the form below.
* HEAR & See what Reports are coming out
* Backtest trade ideas
* Hear tweets as they come out
* Updated support & resistance levels
*Much More!
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2. Hot Market Report: Natural Gas - Colder weather brings out volatility
By Joe Easton, Senior BrokerClick on image below to enlarge
This week’s highlighted Market is Natural Gas futures. Natural Gas is part of the energy sector along with its cousins, Crude Oil, RBOB - Unleaded gas and heating oil. All traded on the NYMEX/GLOBEX exchange.
Most Winters Natural Gas Futures wakes up from its slumber and provides volatility increasing risk and profit potential. Dubbed the “Widow-maker” Natural Gas has a history of making strong trends with little retrace opportunity to exit wrong sided positions. This week is another classic example in the litany. For December Natural Gas Futures, the trend turned after 2 weeks ago Thursday’s inventory report. We bounced off significant support at $2.296 ( based on the November Contract). . EIA reports often provide additional liquidity and opportunities for market reversals. In this case we haven’t looked back since. We have witnessed the three gaps “breakaway”, “runaway”, (also known as continuation) and “exhaustion gap”. The first being $.05 second being $.09 and lastly $.07 respectively. These gaps along with the intraday moves have taken the NG futures from $2.29 to a high of $2.90. This is a $.60 ($6000 per contract) move equivalent to a 30% jump in value! Since this recent high we have retraced some to $2.75, however I expect to make another move higher at least to $2.94 and possibly higher. Bulls want to hold $2.67- $2.71. For full disclosure, I bought a call out of the money with lots of time to give the market a chance to continue the uptrend. Contact your Broker and we can help implement a strategy together.4 hour chart from this morning, Nov. 8th 2019.
This chart was prepared using E-Futures Int'l software, which you can demo for 28 days with realtime data.
To access a free trial to the ALGOS shown in the chart ( DIAMONDS included) along with other tools, visit and sign up for a free trial for 21 days with real-time data.
Natural Gas Futures Specs. (this market also offers a mini Nat Gas futures contract which is half the size)
Hours: 5:00 PM to 4:00 PM the following day, Central Time
Margins: $2700 initial, $2500 maintenance ( as of the date of this newsletter)
Point Value: full point = $100 ( Example: 404.0 to 405.0 ). Min. price fluctuation is 0.1 = $10 ( Example: 404.1 to 404.2)
Settlement: Physical, deliverable commodity
Months: Monthly cycle, All Months
Weekly Options:YES
Some of the basic fundamentals to keep in mind when you are considering trading the Nat Gas market:
1. Longer term view of current market prices
2. Supply and Demand
3. Seasonality, i.e. heating and cooling cycles
4. Be aware of Thursday morning’s EIA gas storage report at 9:30 AM CDT
Our brokers here at Cannon will be happy to chat about the Natural Gas market, other energies, other futures, options, futures spreads and much more!
Feel free to contact us at any time.
3. Economic Calendar
Source: Moore Research Center, Inc.
| Date | Reports | Expiration & Notice Dates |
|---|---|---|
| 11/08 Fri |
9:00 AM CST - Univ of Mich Consumer Sent-Prelim(Nov)
9:00 AM CST - Wholesale Inventories(Sep) 11:00 AM CST - WASDE Report & Crop Production |
LT: Nov Orange Juice(ICE)
Nov Canadian Dollar Options(CME) Nov Currencies Options(CME) Nov Mx Peso Options(CME) Nov US Dollar Index Options(ICE) Dec Cotton Options(NYM) Dec Coffee Options(ICE) |
| 11/11 Mon |
VETERANS DAY
|
|
| 11/12 Tue |
3:00 PM CST - Crop Progress
|
|
| 11/13 Wed |
6:00 AM CST - MBA Mortgage Index
7:30 AM CST - Core CPI & CPI(Oct) 1:00 AM CST - Treasury Budget(Oct) 3:30 PM CST - API Energy Stocks |
|
| 11/14 Thu |
7:30 AM CST - Initial Claims-Weekly
7:30 AM CST - Core PPI & PPI(Oct) 9:30 AM CST - EIA Natural Gas Report 10:00 AM CST - EIA Petroleum Status Report 2:00 PM CST - Dairy Products Sales 3:30 PM CST - Money Supply |
LT: Nov Canola(CBT)
Nov Rough Rice(CBT) Nov Soybeans(CBT) |
| 11/15 Fri |
7:30 AM CST - USDA Weekly Export Sales
7:30 AM CST - Empire State Manufacturing(Nov) 7:30 AM CST - Export(ex-ag) & Import(ex-oil) Prices(Oct) 7:30 AM CST - Retail Sales(Oct) 7:30 AM CST - Retail Sales Ex-Auto(Oct) 8:15 AM CST - Capacity Util & Industrial Prod(Oct) 9:00 AM CST - Business Inventories(Sep) 11:00 AM CST - NOPA Crush |
FN: Dec Cocoa(ICE)
LT: Nov Lumber(CME) Nov Nikkei Options(CME) Nov Eurodollar Options(CME) Dec Crude Lt Options(NYM) Dec Orange Juice Options(ICE) Dec Sugar-11 Options(ICE) |
| 11/18 Mon |
3:00 PM CST - Net Long-Term TIC Flows(Sep)
3:00 PM CST - Crop Progress |
FN: Nov Lumber(CME)
LT: Nov Eurodollar(CME) Nov Mx Peso(CME) |
| 11/19 Tue |
7:30 AM CST - Building Permits & Housing Starts(Oct)
3:30 PM CST - API Energy Stocks |
|
| 11/20 Wed |
6:00 AM CST - MBA Mortgage Index
9:30 AM CST - EIA Petroleum Status Report 2:00 PM CST - Dairy Products Sales |
FN: Dec Coffee(ICE)
LT: Dec Crude Lt(NYM) Dec Platinum & Palladium Options(NYM) |
| 11/21 Thu |
7:30 AM CST - USDA Weekly Export Sales
7:30 AM CST - Initial Claims-Weekly 7:30 AM CST - Philadephia Fed Index(Nov) 9:00 AM CST - Existing Home Sales(Oct) 9:00 AM CST - Leading Indicators(Oct) 9:30 AM CST - EIA Natural Gas Report 3:30 PM CST - Money Supply |
LT: Nov Feeder Cattle(CME)
Nov Feeder Cattle Options(CME) |
| FN=First Notice, OE=Option Expiration, LT=Last Trade | ||
* Please note that the information contained in this letter is intended for clients, prospective clients, and audiences who have a basic understanding, familiarity, and interest in the futures markets.
** The material contained in this letter is of opinion only and does not guarantee any profits. These are risky markets and only risk capital should be used. Past performances are not necessarily indicative of future results.
*** This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts herein contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgment in trading!
