DAILY E-LETTERS

3/1-3/31

03/31/00

Yen up 200 on overnight with the aforementioned TANKAN being released next week
(APRIL OPTIONS ALSO HAVE ONE WEEK TO GO) and "BIG AL" says he is not picking on US stocks (that's a relief!).

         A friend of mine read a book and wants to daytrade in markets with small moves (1/16) and LOW volatility (as per "the system") He seeks only 1/16th per successful trade BUT risks 2/16ths. Using some simple math he must "win" 2 out of every 3 trades to breakeven and then add the "costs" (commission,time). I am familiar with "scalping" and while it has its merits it should be executed in markets with a decent daily range and volatility and requires quick decisions and order execution. For these reasons the electronic markets (mini S&P and NASDAQ) offer the best of both worlds. With no floor brokers (middlemen) and the ability to SELL as easy as you BUY these markets are excellent daytrading vehicles. As an example you (and I do mean YOU since I can "hook you up" with and electronic account to trade these markets with FREE LIVE QUOTES @ $29 per trade)would place a SELL at 4410 and a BUY at 4390 with stop(sometimes reverses) 10 points away(4420 but stop 4380 sell stop) and you wait for the market to fill both limit orders and take your scalping. CALL me about details.

Have had a number of electronic problems today (due to yesterdays "upgrades")so this is shorter than I hoped. MY APOLOGIES.

JYEN-is going through the roof as it is now up 240 points. AVOID bucking this trend.
SOY BEANS-planting intentions could send market soaring.
COCOA-has not hit its bottom yet
COTTON- is not dead yet.
SILVER-did not bounce enough will break 492 low next week..

03/30/00

IBM, CRUDE OIL, SILVER all have one specific thing in common that allows you to analyzeand trade them the same way you would "dope out the Form" for the Kentucky Derby, Historical PriceMovement or simply CHARTS. They tell the story (sometime a few minutes late) and it is the job ofthe analyst to write (and trade) a probable ending. Fundamentals should not be "thrown out thewindow" but used as an additional tool for the technician. I prefer to enter a number of my optionsplays just before the release of this type of data and find often that the short period of time is irrelevantto the big move that could occur. PLANTING INTENTIONS for US Farmers is released tomorrow
and is an excellent example of the points I just made. On to the TRADES.

S&P 500-did almost exactly as we forecast yesterday (except for when OUR PRESIDENT spoke which messed everything up) speaking of WHOM will be arriving at MY BACK door later today (he will visit the NYSE). The INDEX is DOWN 14.00 points right now (8:30 I'm running late!) and I see an ideal situation where the over night "GAP" may be filled DAYTRADERS should either BUY a dip to 1411.50 or wait for a conformation by entering the LONG side with a BUY STOP at 1520.50. EXIT target is 1529.50.

SUGAR-did a nice "cleanout" and appears ready to fill a long time "gap" at the 565 area so in a two tiered DAYTRADE BUY MAY SUGAR at 541 with a 534 stop and REVERSE at 564. 550 PUTS also become the BUY at this level for approx 11 points (let the order work)

03/29/00

       Opec and "BIG AL" should be quite for awhile but there is no lacking of fresh news and meetings on the near horizon. The Japanese TANKAN (most major economic report) will be released next week, ECB (European Central Bank) will meet tomorrow, and US farmer Crop Planting Intentions is due on Friday.  By the way, that BIG S yesterday was in tribute to the Michigan State Spartans and their "inevitable" Championship. On to the TRADES.

CURRENCIES-as mentioned should have an interesting two weeks with Europe and Japan having events. Coincidentally, the April OPTIONS expire a week from Friday and a few plays are in the making. The JYEN is up 50 on the overnight (9629) and a DAYTRADE BUY is on a pullback to 9600 (use 9602 entry) with a stop at 9584. Swiss Franc rallied on an rate hike but does not seem very strong and the 6000 PUT for approx 18 points ($225) is a solid play.

STOCK INDEX's-appear (to me) to be forming a text book BULL FLAG (BIG up move followed by THREE days of lower highs and lower lows) with today being the third day SO for DAYTRADERS look to SHORT the S&P(I prefer the MINI for daytrading) at 1539.50 with a stop at 1545.25. The DOW JONES has the potential to touch the 10,900 (futures price for JUNE) and expect a good bounce if that level is touched.

PORK BELLIES-posted back-to-back LIMIT UP days (300 points or $1200) as was projected here last week. The release of a "Hoof and mouth" breakout in Asia has been sighted as on cause and though these same circumstance helped catapult the bellies to $1.00 a few years ago I am inclined to "FADE THE JOURNAL" today and go SHORT (just today) 9540 is my SELL level and tight stops are really unheard of in this market but I will go with 9615 risking approx $300. CAUTION wait till the opening bell before placing orders in case it goes limit up again (I do not want to get anybody "stuck" in this ever dangerous market)

QUICK NOTES
COCOA-bounced at my number (ok I said 785 it hit 786) SELL at 822.
MEATS-should stay strong LIVE CATTLE my favorite
COTTON-rally made stall due to genetic news from Chins.
SUGAR-is a SELL if(when) it fills GAP at 565.

03/28/00

           Trading the OPTIONS markets are a game in themselves as the average speculator does not keep in constant touch with the floor, follow past option patterns, and play with bids and offers aswell as cancels or FOK (fill or kill). I find that when most people are giving up (because of time elapse or lost money) and "dump" their options for a hundred bucks that is is usually a good time to get in.  The short "time factor" involved in my plays is based on the fact that TIME is a luxury that is expensive and often an unnecessary element for a successful trade. Using KEY reports (Crop production), MEETINGS (OPEC), and technical factors as a prelude to making a short term option purchase will allow you to take a larger position with increased probabilities for the same "cost" as the longer term play. You only have to hit ONE of THREE of these types of trades to show a substantial profit. On to the TRADES.


LIVE CATTLE-is trying my patience a tad with the April contract not able to break through the contract highs (7350).CALLS for this month, STRIKE 7400 at 25 points each ($100) are enticing and will complement the 7300 CALLS we rec'd at 40 ten days ago, but the most "attractive" (more TIME than I am use to) play is the JUNE 7200 CALLS for 30 points (LC is $4 a point with a 150 point daily limit).

COPPER-has multiple signals generated in the past week including firing a fractal BUY signal last Wed when it broke the 8210 level. Due to the expiring April option (today) and the MARCH Contract (tomorrow) the market had a "perfect" cleanout yesterday dropping below the significant 8000 area just long enough to take out stops. BUY ONE 8200 MAY CALL for 130 points ($325) and TWO 8400 calls for 80-90 points especially with the next two factals being at 8600 and 9000.

QUICK NOTES
GOLD-will chase STOPS down to 275 (after that maybe 260)
LEAN HOG-headed for 75 cents
PORK BELLIES- $1.00 per pound is not unlikely after Friday's BULLISH report
COCOA-JUST KEEPS DROPPING (may "bounce at 785)
SUGAR-is a SELL if(when) it fills GAP at 565.

03/27/00

      Russia elects a ruler, OPEC flexes its muscle, and the SPARTANS are in the Final Four again (I am a MSU Alumni). Report wise this weeks holds some key releases in both the economic and agricultural areas. Today the Consumer Confidence numbers will be slightly weaker than last month (140.0 verse 141.8) and existing home sales up.26 million. New Home sales figures will come out on Wednesday and are expected to rise to 890,000 from 882,000. Thur. is the final 4th quarter GDP slated at +7.0%(adj .1%+) Friday Personal Income +3%, Consumption +.9% and Factory Orders -1.0% round out the economic side of the week's data and in the Agricultural sector Planting Intentions and Grain stocks will be released before the market opens. On to the TRADES.

CRUDE OIL-rallied slightly on Friday, perhaps in anticipation of This week's OPEC meetings, but after oil hit a 9-year high above $34 a barrel this month, the market retraced 20 percent. The major OPEC exporter Saudi Arabia wants to ease up on its export restraints and keep prices of $23 to $25 a barrel but OPEC members like Iran, Libya and Algeria have resisted, setting the stage for today's meeting. Three full trading weeks remain on the MAY options and with the OPEC premium built in they are NOT CHEAP but as rumors and facts are released volatility should rule. A BULL spread seems the most frugal way to play both the meeting and the ensuing API reports and "legging in" is the best method. BUY the 2800 CALL at 110 (on a possible early morning dip) and then (on the afternoon rally) SELL the 2900 CALL for 85 which would produce at debit of $250 with a max profit potential of $750 ($1000-250) ALSO the APRIL HEAT and GASOILINE options expire on TUESDAY but it would be hard for me to guage a entry price without seeing how the market opens at 9:50 est in NEW YORK.

GRAINS- especially the Soy Bean, has been up and down in a 13 cents range for a week and may have a sharp dip before the run up after Next Friday's report. MAY CALLS were recomended and still are. Those who went with our LONG BEANS/SHORT WHEAT play should lighten up on half the position after friday's 11 cent differntial. DAYTRADE wise SELL MAY WHEAT at 269 3/4 with a stop at 272 1/4.

COCOA-hit our fractal of 841 and took out some longs. Still see the 757 contract LOWS being retested in the next few weeks and oppourtunity's increase with a pop up to the 854 level (which is a good DAYTRADE SELL area with a stop at 866). The 850 PUTS (in the money at this writing) may shrink back down to $180 each and would be a great BUY.

QUICK NOTES
DOW JONES-trend monday IF dow CASH(opens at 9:30 est) is up or down 50 points in the first 15 minutes GO WITH THE TREND using a 20 point ($200) stop.

03/24/00

         If spring water costs $20.00 per GALLON how is GASOLINE overpriced at $2.00
per??? Just my thought for the week. Friday's (of which today is one) is usually one that I use to EXIT option positions (many often expire at week's end) so I do not have as many trade ideas as usual. So I will use some space to reiterate some trading methods I use and some quick rules we all know yet often break ( it does take a lot discipline to trade, successfully)


Use limit orders (both for entry and exit) never "at the market"
Don't "chase" markets.If your limit is touched but not filled cancel and LOWER
         (or RAISE on sells) your price

• Never double-up on LOSERS (Why does everyone do that?)
  Have "stop loss" order to enter when establishing a position (and only move it
  CLOSER)  3 stops and you're OUT (cancel/replace 2 times and you are LUCKY, 3ird time I'll bet you're OUT)                                                                                                                  Use open orders (GTC good till canceled)
  Sell options on FRIDAYS buy them on MONDAYS (due to erosion of time
  value)

PRINT THESE E-LETTERS and refer back to them (many of my option trades
and S&R { support and resistance} numbers take 1-3 days to activate.

Just following these rules WILL NOT make you money (You still NEED winning trades) but it will make you a better TRADER and increase you profit probability. On to the trades.

PORK BELLIES-can go either way due to conflicting reports over "packaging of the belly" (changes would be bearish) and this afternoons Quarterly HOG & PIG report (rumored to be bullish). I, of course, like the options in a situation like this and feel the upside is the right side. As we always note the Belly options are among the most expensive (due due the high volatility) so usually 1 is a sufficient play for the small speculator. BUY the MAY 9600 CALL and SELL the MAY 10000 CALL for 100 points debit ($400).

SOY BEANS-will probably enjoy a quite day and settle within +/- 1 cents of $5.25 due to the APRIL option expiration. Though I feel these beans need to drop to the 514 area before they start their summer ascent start BUYING the MAY CALLS today 550 for 5 1/4 cents and 575 for 2 1/2.

03/23/00

Those who have followed my writings know I specialize in recommending short term
LONG options. That is NOT all I trade and while I attempt to provide DAYTRADE numbers in many markets, this form of speculation requires plenty of "thinking on your feet" as support/resistance and trends shift throughout the day. I do accept phone calls with updated trade numbers especially for the S&P and NASDAQ (I prefer the liquidity of the MINI's as well as the electronic access) so feel free to give me a ring and see if what I have to say is of value to you.  On to the TRADES.

COTTON-fullfilled TWO requisites for going LONG. It retraced 33% (up over 14 cents since JAN 1 and dropped 4 1/2 this past week) and dipped below the significant number of 60.00.   We mentioned to watch for this move last week and now that it has occurred our option play has been activated. BUY the MAY 6200 CALL for 45 points ($5 a point) AND the 6300 CALL for 25 points ($125). For DAYTRADERS BUY MAY at 59.55 with a stop at 59.20 risking approximately $175.

COCOA-options we have (850 puts for 17 points) and yesterday's close hit weekly highs (875) so that sets us up for a DAYTRADE. SELL MAY at 882 with a TIGHT STOP at 892 (risk $100). Tentative exit point is 851 with supporting fractal at 841.

QUICK NOTES
LIVE CATTLE-just missed contract highs by 10 points VERY BULLISH
COPPER-option expires TUES should test 80.00 support level
NATURAL GAS-will New York BUSES change from diesel to NG???
JYEN-down 70 points "THE TREND IS YOUR FRIEND" SELL!!!

HEATING OIL, UNLEADED GASOLINE, NATURAL GAS and COPPER options have
FIVE DAYS
BOND and GRAIN OPTIONS EXPIRE FRIDAY

03/22/00

         It always amazes (but no longer surprises) me how almost every time an interest rate hike (or drop) is announced that the Stock Index's go in one direction first (the basic "cleanout") before they move rapidly the other way. Such was the story yesterday as the 2:15 announcement saw the markets drop like a rock only to reverse and set new highs. Just keep that in mind for next MAY's rate hike. My favorite quote from the FED yesterday was concerning the present economic conditions which said RISKs remain "weighted toward conditions that may generate heightened inflation pressures". GO FIGGA' On to the TRADES.

US BONDS-enjoyed a rally after the rate increase since the perception down the road is not for too many more hikes. Options expire on Friday and the short-term play is BUY the 9600 PUTS for 8 points (about $100) and if 9528 trades BUY one future (verses every TWO PUTS) to position yourself on both side for the rest of the week.

LIVE CATTLE-filled its "gap" last week as expected and is now poised for a run at contract highs (73.50 for APRIL) the COMBO trade we recommended last week is still quite viable. BUY 2 April 7300 CALLS for 40 points ($180 each) and 2 June 7200 CALLS for 30 points ($120).  Livestock slaughter report is released Friday afternoon.

QUICK NOTES:
COPPER-should retest 80.00 level and bounce
OJ-bearish head and shoulder formation
WHEAT-weakest of all the grains
BEAN OIL- opposite of the WHEAT
LIVE CATTLE-left a bullish island bottom
HEATING OIL, UNLEADED GASOLINE, NATURAL GAS and COPPER options have
ONE WEEK till expiration.
BOND and GRAIN OPTIONS EXPIRE FRIDAY

03/21/00

A good day for less talk and more ACTION! On to the TRADES.

SOYBEAN-chart illustrates two formations that are not often seen but each are BEARISH. An inverted head and shoulders (Jan and March highs and Feb lower high) and an ISLAND TOP (left when market "gaps" up one day and "gaps" down the next) which developed yesterday. I keep stating I am seeking a spot to enter as a long term BULL and if the May contract can trade down to the 511-513 area I will have my entry target. Short term (April options expire on Friday) I prefer the PUTS (520 strike for 2 1/4 cents {$112.50}) BUT for MAY options (if my scenario plays through) BUY CALLS MAY 550 for 5 cents and 575 for 2 1/2.

COCOA-with the drop of $100 in 2 days erased half of the $200 gained in the 13 days. This
market has been very kind to SELLERS after periodic rallies. 841 is both the next support level and a triggering fractal point which, if broken, signals a possible retest of the 27 year lows (757).  Today, on a DAYTRADE I expect a slight early morning rally to 872 (SELL 871) with a stop at 883 (risk approx $120) BUY PUTS MAY strike 850 for 17 points ($170).

COTTON-is in the midst of a well needed cleanout that should continue till the 60.00 cent level is breached. This fiber has seen a 14 cent run up in this millennium so a 4 cent drop in a week is not overly bearish. The MAY 6200 CALL could be had (for those that are patient) for 50 points ($250) and still has over 3 weeks to go and a KEY report on the 31st of this month.

QUICK NOTES:
SILVER-breaks 505 then 490 is a target.
OJ-bearish head and shoulder formation
WHEAT-weakest of all the grains
BEAN OIL-oppisite of the WHEAT
LIVE CATTLE-left a bullish island bottom
HEATING OIL, UNLEADED GASOLINE, NATURAL GAS and COPPER options have
ONE WEEK till expiration.
BOND and GRAIN OPTIONS EXPIRE FRIDAY

03/20/00

     As another season begins the unanswered questions from the winter still persist. Will there be a long sustained DROUGHT in the U.S. this SUMMER? Is OPEC going to INCREASE production in time to stave off $2 gasoline? Will "BIG AL" surprise the economy and STOP raising rates? Answers to these questions and many more will be unfolded in our coming episodes so stay tuned. Same BAT time same BAT channel.(HEY how about that SNOW in NYC on FRIDAY!!!)  Highlights in the economy this week include: TREASURY BUDGET today is forecast at -$43.1 billion (that seems like a big number) with the TRADE DEFICIT due Tuesday at -$26.5 bil (from -$25.5 last month). "BIG AL" Greenspan will have his monthly meeting Tues also and is expected to RAISE rates 1/4 of a %. Friday ends the somewhat "quite" week of reports with the DURABLE GOODS slated to come in at -.2% up from -1.3%. ON to the TRADES.

CURRENCIES-will be watching the FED report this week and will be reacting to the elections in Taiwan last Saturday and the increase of the short-term rates in the Euro. The JYEN is expected to take the brunt of these increases even after Friday's 100 point drop. 3 weeks remain in the April Options (which mean they are still quite expensive. A bear spread in the JYEN is the call. BUY the 9400 PUT and SELL a 9250 for a Debit of 35 points (each point is $12.50). The Canadian Gov't is expected to follow the US rate change (if there is any) so look for some strength in our Northern cousin's currency. CALLS at strike 6850 go for 24 points ($240) and are a good BUY.

COFFEE-has been S L O W L Y dropping towards a dollar a pound due to strong harvests and exports. A meeting in London on the 4+5 of APRIL will have the Brazilian and Colombian Govt's pushing for regulation of exports which may result in the with holding of 5 million bags of coffee from the world market. OPTIONS for the MAY contract expire on the 12th of APRIL which leads us to BUYING the 115 CALLS for approx 100 points (1 cent or $375) (the 120 may be had for
.50)

BOND and GRAIN OPTIONS EXPIRE FRIDAY

03/17/00

              OPTION EXPIRATION did not disappoint from the perspective of past trends and unusually high volatility.  WHY so many OPTIONS plays??? While DAYTRADING is fast (and FUN?) it requires more minute by minute attention and effort. POSITION trading can prove to be very lucrative but exposes one to radical overnight price moves and an "uncontrollable" risk factor. By sticking with LOW PRICED, HIGH VALUE (timed before reports/flat markets/low volatility) LONG OPTIONS not only can we set a specific game plan and alleviate unnecessary risk, but with an average account size (5-15K) we can be in 3-5 different markets simultaneously, investing as little as 10% per commodity. Steady profits can be achieved by merely hitting 1 of 3 plays and if you have a "hot week" (we get them sometimes) and cash in on all three that 30% risk could result in a DOUBLING of the account. Of course the equal probability exists that you lose every trade but that is why they call this "speculation" and not "WINNING" On to the trades.

SOY BEANS-seemed to have formed an inverted head and shoulders and dropped to unchanged by the close. A triple top now exists and if yesterday's highs are taken out it becomes even more bullish. I am "still waiting" for a decent "cleanout" and unfortunately may not get it with the BEANS up 8 CENTS on the over night.

Still like this week's LIVE CATTLE (buy 73 calls April 72 June) COCOA (puts cost less now) and OJ (fear of frost GONE).

03/16/00

          PPI heads the list of economic numbers today (it is expected to be slightly inflationary at +.5 to.6%) but more of a factor maybe the expiration of the March Index OPTIONS. It was stated here last week that HISTORICALLY (which does not mean 'ALL-the-time) the market trades UP on the last remaining days of the options (this is due partially because fund managers use the PUTS to protect their underling stocks and "pressure" is relieved as expiration draws nearer). Quick REMINDER though the options EXPIRE today the settlement price will not be determined until the OPENING of the market on FRIDAY. On to the TRADES.

LEAN HOG-is in a strong bull phase and may offer an opportunity to enter today. Retracment and support seem to be at the 70.00 level (that would mean a drop of 1 cent today) and a third day with a lower high and a lower low would finish a BULL flag formation. DAYTRADERS should place BUYS at the 70.05 area with a relatively tight stop at 69.45 (risk approx. $240) In the OPTIONS BUY the the JUNE 7100 call and SELL the JUNE 7500 CALL for 1 cent ($400).

COCOA-inched up to the 900 level in the MAY contract and could "nip" at stops just above this number. The MAY 850 PUT for 17 points ($170) with three weeks to go is a fine speculative move.

Orange Juice-has experience periodic "pop-ups" due to weather related situations but has a plentiful crop both domestically and foreign. For 200 points ($300) a BUY of the MAY
8500 put could prove to be a viable play for the next month.

03/15/00

      Again the question of the week is CRASH or CORRECTION?? As has been mentioned earlier this week the OPTION expiration (Triple Witching) is a dangerous time to be in overnight positions and the best way to play the stock indexes is through these short term instruments. Will a rebound occur today? Overnight's have the Nasdaq up 44 which is still below a 33% retracement.   Industrial production and current account deficit are due this morning and may aid in a short term recovery. On to the TRADES.

CRUDE OIL- dipped 33 points yesterday and is DOWN 40 despite some numbers in the API report that would point toward bullishness. One figure states that "total inventories of crude oil and refined products (are) the lowest since the end of March 1996" API news release 3/15. With only one day to go in the APRIL options we may not see as much activity as would normally follow this report. Still there are some good opportunities to incorporate the options with the futures for the next two days.

SILVER-is a most perplexing and often tantalizing market. For SEVEN days the settlement price for MAY has stayed within a 4 cent range-almost in the middle of the two strike prices $5.00 and $5.25.  The PPI due tomorrow may trigger either BUY signal by breaking 5.18 1/2 or SELL at 506 1/2. Either way it seems unlikely that this metal can stay so range bound. With three weeks to go in the MAY OPTIONS and hints of inflation a purchase of a 525 call for 7 cents ($350) would be my selection except that premium price is a little high. For those who like intricate strategies here is a combo trade. SELL MAY STRANGLE 500 put and 525 call for 16 cents and BUY the JUNE 550 call and 475 put for 10 cents, and take a credit of 6 cents and see if the 525/500 range hold till the may expiration.

LIVE CATTLE -had posted two week highs at 6985 and just completed a 33% retracement of its gains and looks poised to launch a run to contract highs. JUNE 72 CALLS at 30 points $120 is a solid long term play in this meat.

03/14/00

      It was forecast that this would be an action packed week for futures traders and so far it has lived up to the hype as even the Mighty Mighty NASDAQ proved nothing is completely unstoppable (down 141 points, 4th largest drop ever). Triple Witching and a host of economic numbers will proliferate the next four days which should translate into high volatility (an option traders utopia). Inflation indicators such as the PPI (thurs) and CPI (fri) may affect the Precious Metals market. Cold weather and tonight's API report will move the Energy Complex and let's not forget about the National Weather Service's cautions about possible drought conditions this summer from La Nina' remnants. 'NUFF said, on to the TRADES:

CRUDE OIL settled at $32.00 a barrel (on the APRILcontract) and had a 84 cents range. Last week's API (American Petroleum Institute) report was quite bearish (highest stocks since Sept 98) resulting in a $2.00 drop in crude the next day. What will tonight's report reveal?? I don't know (if YOU do , call me) but with puts and calls expiring Thursday it is time for the 48 HOUR OPTION PLAY. In APRIL a STRANGLE (31 PUT / 33 CALL) may go for $400 on the opening (a little less if you work each strike at 16 points each throughout the day) or on a 20 point dip BUY the 3250 CALL for 26 points ($260) each (remember at least TWO for flexibility). Still see the HEATING OIL as a fine short term rallying vehicle with snow forecast for parts of the East coast this weekend).

COCOA-hit a 885 double top this morning on the open and the MAY 850 PUT looks quite
attractive at 19-21 points ($190-$210). Same underlying reason as delineated last week.

SUGAR-sparked some interest when it surged 20 points yesterday settling at 542. There is a "GAP" at the 562 level that could be touched today but overall this market is still in a LT downward trend. IF the gap is filled the option play is BUY one MAY 550 put for 14 points and two 500 PUTS for 7 points (total outlay $268 plus commissions ) if only the 550 area is touched 3 500 puts would be the call.

SOY BEANS- have been increasing their range daily and have touched the Mid-term trend line which should result in some selling. I am still waiting for one last "cleanout" to begin picking up MAY and JULY CALLS but in the meantime I will BUY the APRIL 510 PUTS for 2 1/4 CENTS ($112.50 each) since they still have ten days to go till expiration.

03/13/00

        Let's get right into what will be an action packed week in the Futures market. Reports begin today with the release of the WORLD Agricultural Production report. Economically speaking the first wave of data is due tomorrow morning in the form of RETAIL SALES expected up .2% from last months +.7%. Wednesday INDUSTRIAL PRODUCTION is targeted at +.4% (+.5% last time) and CAPACITY UTILIZATION at 81.8% up .2% and current Account Deficit for the 4th quarter is expected to rise to $95.0 bill from $89.9. Thursday (last trading day for Stock Index Options) features the PPI (Producer Price Index) which was unchanged in FEB and is projected to be +.6% (+.3% excluding energy) and Housing starts which should be .06 million lower than lastly month. And finally on Friday (TRIPLE WITCHING) the CPI (Consumer Price Index) is expected to double from last month at up .4% from +.2%. Due to some "panic" in the Asian Markets perception of the "TECH SECTOR" the overnight prices in the Stock market are WAY DOWN (S&P OFF 22 points and NASDAQ is LIMIT DOWN at 82 points) On to the TRADES.

STOCK INDEXES-and their option (MARCH) have a week to go and with HEAVY selling
expected on the opening a close inspection of the price of CALLS would seem to be the way to start the week off. I have mentioned in the past that the frequency of times that the market trades UP near this expiration is several times more probable than the reverse. I will not be "DIVING IN" on the open but the CALLS are the way to go. (Those who are daring can get some "Juicy" premium for SELLING PUTS taking advantage of HIGH VOLATILITY).

SOY BEANS-had a slight pull back on a Semi-neutral report but with headlines in the WSJ touting an upcoming drought in the midwest this planting season the overnight bean market is up 5 cents. I have been looking for a spot to get LONG the distant BEAN CALLS and in the meantime still consider the 520 APRIL CALLS for 3 cents a good short term investment (they still have two weeks till expiration.

HEATING OIL-has been the weakest of the weakening energy complex (which may only be a retracement) due to all the hype about summer driving season and OPEC decisions. With two weeks and one day left till APRIL option expiration this market has a great deal of potential.  Unfortunately the Premium for an option that is 4 cents out-of the-money is 1.25 (almost $500) so this seems to be an opportunity to SELL PUTS. I happen to like the HEAT this week mostly because for the next SIX days the EAST COAST is predicted to be in the midst of another COLD spell that could culminate with snow this weekend. (APRIL CRUDE OPTONS expire a week from tomorrow and are MUCH less expensive BUY the 3300 APRIL CALL for 22 points $220)

03/10/00

It is one of those Friday's, USDA reports released at 8:30, 5 options expire( Sugar, coffee,
Silver, Gold, and Platinum), and a plethora of economic information will be released next week, SO our insights will be limited today. I will give you all a few LINKS to some site that provide some interesting information. The first is the COMMITMENT of TRADERS
(http://www.cftc.gov/dea/cot.html) where the Positions of commercials and speculators are revealed . You can follow your own system but I like to be on the opposite side of the speculators. WHY?? It is just one factor I use when doing MY analysis. The second is the CROP PRODUCTION (http://usda.mannlib.cornell.edu/reports/nassr/field/pcp-bb/) which offers a myriad of data. On to the TRADE.

INDEX OPTIONS-are an ideal vehicle to watch (and PLAY?) today . S&P (reg and mini) and DOW options for MARCH expire on Thursday. The premiums become more reasonable after the time value over the weekend expires SO SELLERS may want to take a two day short position (strangle would be best strategy) in these options.

03/09/00

       I love options!!! Sure, occasionally they expire worthless and the market then continues in the direction I wanted (leaving me to "curse" the manipulative floor brokers) but the advantages they provide clearly outweigh the negatives. In volatile markets (like the CRUDE OIL) using the LONG OPTION strategies I provide give us three major advantages. 1) We have a limited risk--the total cost of the option we BUY (plus commission) is all we have to lose regardless of which direction the market heads. 2) By purchasing multiple (usually three) options we "set ourselves up" for trades down the road (we may use the Futures contract to "lock-in" a profit or use the "protected contract" as a daytrade vehicle). 3) We can enter into several markets and build a portfolio of futures positions using set percentages of the account (usually 10% per market). The profits are not as extreme as if you had a futures position but then again you do not have to wait an hour for a fill back on you stop in a market that dropped 100 points in 5 minutes. On to the trades.

COCOA-is in the midst of a run-up due to the delivery pressure on the EXPIRING (next Thursday) March contract. How much higher can it go?? Not quite sure but with the MAY 850 PUT trading now at 34 points ($340) I will be placing a BUY order at a price of 21 ($210). The underlying future (the MAY) is trading at 871 and I expect resistance at the 888 level. Cocoa has been in a year long down trend due to the fact that chocolate is a LUXURY not a NECESSITY and world economies are having enough problems with supplying their people with food and energy and have little spare cash for "Godiva's" fine products.

GRAINS-have two BIG reports due "back-to-back". Friday is the Monthly USDA Crop
production numbers (always "fun" deciphering these things) and on Monday we have the
WORLD AG report. Again the way to approach the affected markets is through the OPTIONS. It is hard enough "guess" what the reports will reveal and often times their release triggers "LIMIT" moves something that is "great" if you are on the right side but "catastrophic" otherwise. The PLAY??? On a slight (3-4 cents) pullback BUY 2 APRIL SOY BEAN CALLS strike 520 for 4 1/4 cents ($212.50) and 1 500 PUT for 2 1/2 cents ($125) Report is released at 8:30 est tomorrow. APRIL WHEAT PUTS are also on my list.

03/08/00

       Status Quo these days seems to be stock markets up or down 200 points and analysts
saying "don't worry be happy". REBOUND could be the word of the day as Nasdaq is up over 40 points and even the Dow has strength (up 90 points). While this week is SLOW in terms of report releases ("BIG AL" does give a speech to banker's at 9:30) next week makes up for it and then some. Beside the "TRIPLE WITCHING" next Friday CPI, PPI, BUS. INV., WORLD AG PROD., RETAIL SALE and EARNINGS all come out. On to the TRADES.

CRUDE OIL-was a SELL (DOWN OVER $1.00 overnight) only not until the day ended. Last night's API report revealed the LARGEST CRUDE OIL STOCKS since Sept '98 and this number has the OPEC thinking about a change in their supply stance. Can't say the run is over but "cleanouts" in this market are always viscous and with the APRIL option still having a week and two days to go this is were you should look if thinking about trading OIL. SELLERS can find some high volatility on BOTH sides and SHORT STRANGLES (while dangerous) can be very profitable. For those wanting more time the HEATING OIL and UNGAS options do not expire until the 28th March.

INDEX OPTIONS-expire next THURSDAY (settle on Friday morn) and HISTORICALLY
(which of course is not indicative of futures results) the stock market tends to trend up just before Triple Witching. I usually look at the options on the Monday before expiration since the premiums become more reasonable but with the rollercoaster ride the markets have experienced strikes that seem unattainable may be a good start toward a trading plan that can be executed with the futures next week.

GRAINS-are approaching the planting season as well as a "double report affect". Friday the Monthly USDA report is released (8:30 est) and on Monday the WORLD AG numbers are unveiled. Either of these two could be the "jump start" that the BEANS need. I have been looking for a "pull back" in order to pick up some MAY CALLS at a reasonable price. As a futures play I like LONG MAY BEANS/ SHORT MAY WHEAT with a risk of 4 cents $200.

03/07/00   

   "When is the Nasdaq/Dow spread going to reverse itself?" is the most posed question I have had the past week(I have "touted" this spread since mid-DEC) and my answer remains the same, IT WON'T. The surge that Tech's and Bio's are experiencing are not only the "flavor of the month" but do not have the increased costs that energy prices are bringing to the Industrials nor the effect that a rise rates have on the other sectors. "Should I still get in this SPREAD or is it TOO LATE?". Well most investors HATE not being in on the "ground floor" but given a mild pullback in the Nasdaq or and equally strong DOW DAY (super tuesday may help) I say "full speed ahead".  On to the TRADES.

SUGAR-may not be rescued by the Russians (the BIGGEST importers of sugar) after all. Without this demand factor I do not see much hope for this market until the end of the current trade cycle. A double top may form before the next big drop and that point should be SOLD. Today seems like the IDEAL time for this to occur. SELL MAY SUGAR at 5.24 with a stop at 5.38. I have some concerns because the options are SO CHEAP (i usually say inexpensive but not today) with the MAY price at 5.04 the 500 call is only 10 points and the 500 put is 6 and they EXPIRE on Friday.. Either are an excellent start to playing this market for the week.

CRUDE OIL-is higher in the overnight by 35 cents (what else is new) and while I have said that there IS NO TOP until an official OPEC decision is reached TODAY seems to be a good SELL opportunity with the API (American PetroLeum Industry) numbers coming out tonight a retracement is not unlikely SELL APRIL CRUDE at 3259 or BUY the APRIL option 3100 PUT for $250 which expires a week from Thursday.

GOLD-has not shown much life and the April option expires on Friday (as well as the SILVER) A 295 CALL goes for about $120 and you may get a 290 PUT (if you wait half a day) for $160 which would set up a nice STRANGLE.

03/06/00

Not the most active week, report wise, BUT "BIG AL" will have a little say in the matter at 11:00 est today. Slight weakness in the overnight stocks (Nasdaq down 10 and S&P off 1.50) should not overly dampen a continued quest for 5000 on the Nasdaq (are you all still long from 3960?) Tomorrow Productivity for the 4th quarter is expected at +6.5% a rise of 1.5% from the previous and Consumer Credit a $8.0 billion down from 11.2. Thur is the Initial Jobless Claims (280,000 verses 275,000) and on FRIDAY is the MONTHLY USDA PRODUCTION report which can affect GRAINS, COTTON, and other softs. On to the TRADES.

JYEN- on WED broke the 9400 area and touched off a fractal BUY signal by exceeding the FEB 1 high. Pull back on friday may have had something to do with the options expiration and the market is up 45 to 9330 this morning. TOO much time in the APRIL options for my taste but a retest of the 9400 area will signal a triple fractal top and trigger a BUY and HOLD strategy up to the 9633. SELLING PUTS is a good option ,move (I suggest the 9200 for 55 points $687.50). I would also look at LONG YEN/ SHORT SWISS 1 to 2. WARNING JUNE become the "FRONT
MONTH" tomorrow!!!

SOY BEANS-may be range bound (515 to 505) in anticipation of Friday's crop report or Thurs export numbers. There is PLENTY of time in the APRIL serial option in the beans (two weeks and 4 days) and wHile I am BULLISH I will BUY the 500 PUTS for 3 1/2 cents TODAY in expectations of a drop off in the next two days and then BUY the MAY FUTURES contract at the 501-500 level. You can WAIT and BUY the 510 CALLS for 3 cents IF $5.00 does trade in the MAY.

LIVE CATTLE-gave us a BUY signal LONG TERM last week and we bought the JUNE 7200 calls and it was a strong week for the meats. Today ALL signs point towards a DROP of 100-110 points (33% retracement of 8 day move and filling of the "GAP" from Thurs) and then NEW CONTRACT HIGHS. LT OPTIONS (CALLS) still the play.

03/03/00

       Unemployment rate due this morning and if it is not out of the range of 5.0% to 2.5% the markets should not have drastic reactions. On to the TRADES.

GOLD and SILVER-moved (and usually move) together yesterday but their charts give off
different technical signals. With the APRI: OPTIONS expiring next Friday (3/10) an SPREAD can be had for a minor sum. BUY the April GOLD 295 call for $200 and the SILVER 500 PUT for 3 cents ($150). TWO of each is the recommended dosage.

COCOA-rallied on some delivery pressure and has been a profitable SELL on each of its previous rallies. The MAY 750 PUT for $120 is a good value play but you may be able to WAIT till MONDAY and pick up the 800 PUT for $220 (it is trading at $300 right now).

COPPER-suffered from lack of "projected future demand" and "excessive short term stocks" but still has a lot of life to it. The APRIL option has 3 weeks left and the 82.00 CALL for 80-95 points ($2.50 per) is a fine BUY today to set-up some other trades down the road.

03/02/00

The ECB did NOT up its interest rate and the "rouge" oil nations are still meeting in London to decide if they will break from the OPEC ranks and up production quotas in April (Crude which broke the $31 level yesterday traded down 50 cents in the overnight BUT is unchanged right now [a bullish sign]). 10:00 is the release of Leading Indicators and New home sales. On to the trades.

LUMBER-not a "great" trading market (similar to Pork bellies many LIMIT moves) but with the $10 limit up yesterday and the release of a key report today (New Home Sales) could mean the start of a bull run. May not get an early "dip" in this market but place BUY orders $2 below the settlement at 338.00.

SILVER and BEANS-are both on their way down. Sliver to the 492 (502 now) area and Beans to the 490 (496) level. At that point I become a BUYER again.

CURRENCIES-did not have a "big" overnight reaction (although the Jyen had a 100 point range) still see the one day March option as a play early this morning given the 10:00 report releases. I like the at the money SWISS PUT 6050 for 22 points $275.

EXPIRING OPTIONS
SWISS, YEN, CD, AD, $, MARCH LIVE CATTLE and APRIL COCOA on FRIDAY

03/01/00

     NOT MUCH "CHIT-CHAT" TODAY. Just a FYI, Jan 28th on the web site's "previous
trades" is the day I noted that July Soybeans were at $5.44 and july Silver was at $5.45. Friday'ssettlement for both were $5.14 exactly. On to the TRADES.

CURRENCIES-with the expiring options (Friday) are still an excellent play. Our SWISS call yesterday (6100 C/6000 P) has one option at-the-money but it was the JYEN that made a strong move last night (up 160 points) so the 3-2 day option looks enticing on that currency too. In the SWISS today you can "work" an option order on a strike 50 points away from the future for about $200 16 points. Given the volatility in the JYEN it would cost apporox. double for the same scenario.

PORK BELLIES-are in a very bullish tone BUT I do like "FADING" the WSJ headline story and today it reads "Pork Bellies SOAR on expectation of BULLISH data". Look for a "CLEANOUT" down to the the 90.00 level. OPTIONS are ALWAYS expensive in this market BUT if you are a "writer" of options (you SELL them" look for "juicy" PUT PREMIUMS (on the dip).

LIVE CATTLE-trade from yesterday (72 JUNE CALLS) still a BUY. QUICK NOTE the USDA has found that 50% of all US cattle have the e-coli bacteria. I am not saying this as a panic but to let most know that it is in the market mechanics already.