It isn't in the losses or the missed signals but in the profits cut short where we suffer failure.

- Joe Kellogg

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June 10, 2008

REVERSAL DATES FOR THE WEEK of June 9, 2008 - June 13, 2008

MONDAY -- Dow
TUESDAY -- Soybeans, Gold, J-Yen
WEDNESDAY -- Soybean Oil, S&P, Euro Currency, Coffee
THURSDAY -- Crude Oil, Silver, Swiss Franc
FRIDAY -- Bonds

CURRENT RECOMMENDED POSITION

MARKETS TO WATCH:

1-JUNE TREASURY BONDS - The three-day corrective rally ended at the 20-day SMA and turned lower. The long-term trend is still down, therefore the T-Bonds should continue towards the 110-00-reaction line target. The next reversal date is due on June 13.

2-JUNE HOGS - The Hogs gapped lower and traded past the (C) low of 7570 stop to trigger the sell signal on June 3. This was enough to confirm the bearish TR pattern signal a trend shift. Hold the short position and move the protective stop to 7625.

3-JUNE BRITISH POUND - A bullish swing pattern is forming at the 20-day SMA and dipped below the 60% buy window on June 5. As suggested, the market traded past the 196.50 trigger price to confirm the buy signal and bullish TR pattern. This appears to be a major TR pattern and could portend a significant rally to the reaction line at 205.50. Hold the long position and use 194.85 as the protective stop. The next two reversal dates are due on June 20 and June 27.

4-JULY COCOA - The market traded through the buy trigger price (2815) on Friday and closed beyond the (E) pivot higher, confirming the bullish TC pattern. In turn, the TC pattern projects another move to the 3100 reaction line target. The next reversal date is due June 17. 

5-JULY CORN - Corn reached the centerline target ($6.73) before closing lower than the opening price. Since last Friday (June 6th) was the projected reversal date, Monday's lower close is a negative trail day signal. This could up a short-term pullback in the Corn over the next few days. If currently long, it is time to move the protective stops to $6.40 or even bank your current gains.

6-JUNE JAPANESE YEN - Friday's rally identified a new bearish trigger price at 9395, based on the May 29-June 2nd reaction swing. A trade below 9395 would portend a move to the lower reaction line target at 9100 on or before the next reversal date due June 20.    

7-JULY SOYBEANS - The recent rally paused at the 78% retracement level, $14.89, before backing off and closing at $14.52. Since Tuesday is a projected reversal date, the lower close on Monday and a lower trade on Tuesday, could be setting up a continuation pattern. The longer-term cycle is still bullish and still projects a price move to the centerline -- currently at $15.75.

*Due to the volatility of the markets, all trade recommendations are subject to change without notice.

How to use the Reversal Dates

Every good trading signal needs three key elements to be considered a successful signal. Time, Price and Pattern. When these three come together, great things can happen. If you can improve your timing or price entry, it can enhance any trading method. That is what the Reversal Dates can do for you. They will identify when the market should react, and at what price level the market needs to be for this to happen. They will even tell you what the market has to do to confirm the trade. The first thing I do is, identify Time.

TIME
The Reversal Date Indicator consists of three parts. The first is Time. This is identified by the projected Reversal date and will indicate which markets are ready to react and when the reaction should occur. The most common misconception about the Reversal dates is the idea that the market must reverse on every signal date, which is not true. Instead, The Reversal Date itself helps to identify the market's reaction. A high percentage of the time, the market will reverse the current trend, but not always. A smaller percentage of the time, the market will form a "continuation pattern," indicating the market will likely continue in the same direction as the prevailing trend. Often this will occur during a consolidation or after a very small correction.

PRICE
Once the Reversal date has been identified, the next thing to do is monitor the price. If the market is making a new high/low, or if it is trading inside a buy/sell window, then the second component of a trade signal is in place. You now have Time and Price working together. For most traders, that will be enough, but the Reversal Date Indicator takes it one step further.

PATTERN
After extensive research into price patterns, I have identified specific price patterns, which occur during reversal timing. These patterns can be used to confirm the market reversals or market continuations. When, and only when, these three components are all working together, will there be a trade signal generated.

Traders Market Views is a product of Traders Network and all statements herein reflect Traders Network's market research. Traders Network and/or its principals, brokers and employees may or may not have established positions in part or all of the markets herein mentioned. It is possible that some of those positions, if any, are in direct conflict with the market commentary herewith.

THE RISK OF LOSS IN TRADING COMMODITY CONTRACTS CAN BE SUBSTANTIAL. YOU SHOULD, THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER OR OVER-COMPENSATED FOR THE IMPACT IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES.

Joseph Kellogg started in the commodity business as a commercial grain merchandiser and basis trader. He was one of the architects of the Farm Marketing Program (FMP). This marketing plan was designed for agricultural businesses to use with grain options in strategies that could not only hedge their cash crops, but also aid in their marketing. He hosted "Futures Talk," a commodity talk radio program that aired bi-weekly on a Los Angeles radio station. Joseph has also developed many option writing strategies, which can be used with the reversal point method.