Daily Morning Report

Wednesday, June 24–Jim Wyckoff’s Morning Markets Report

European stock markets were down in overnight trading, while Asian bourses were mixed. U.S. stock indexes are pointed toward lower openings when the New York day session begins. Trader and investor risk sentiment is less upbeat at mid-week, amid a troublesome rise in Covid-19 infections in some parts of the world, including some U.S. states. This has intensified the debate on whether the rise in infections will result in a renewed lockdown of businesses that would mean further damage to recovering economies.

Gold prices hit a 7.5-year high overnight, on safe-haven demand amid the uptick in Covid cases recently and on notions the easy-money-infused major economies of the world are presently only on “sugar high” rebounds and a reckoning will occur down the road.

In other overnight news, Germany’s closely watched Ifo business sentiment index rose by a record amount in June, coming in at 86.2 from 79.7 in May. “German business sees light at the end of the tunnel,” said the Ifo report. This is just the latest piece of data suggesting major global economies are healing much faster than most economists had expected.

The important outside markets today see Nymex crude oil prices lower and trading around $40.00 a barrel. The U.S. dollar index is slightly up early today. The yield on the benchmark U.S. Treasury 10-year note is currently around the 0.68% level. For perspective, the 10-year German government bond (the bund) is presently yielding -0.44%.

U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the house price index, and the weekly DOE liquid energy stocks report. Also today the International Monetary Fund issues its world economic outlook report.

–Jim
!–more Continue Reading–>

U.S. STOCK INDEXES

September S&P 500 e-mini futures: Prices are lower in early U.S. trading. Bulls still have the firm overall near-term technical advantage but trading has been sideways recently. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is even with the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Today, shorter-term technical resistance comes in at the overnight high of 3,128.50 and then at this week’s high of 3,145.75. Buy stops likely reside just above those levels. Downside support for active traders today is seen at Tuesday’s low of 3,060.00 and then at this week’s low of 3,027.25. Wyckoff’s Intra-day Market Rating: 6.0

September Nasdaq index futures: Prices are weaker on profit taking after hitting a record high on Tuesday. Bulls remain in firm technical command. Shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at the overnight record high of 10,242.00 and then at Tuesday’s high of 10,296.25. On the downside, shorter-term support is seen at 10,000.00 and then at this week’s low of 9,843.50. Wyckoff’s Intra-Day Market Rating: 4.5.

U.S. TREASURY BONDS AND NOTES FUTURES

September U.S. T-Bonds: Prices are slightly up in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at this week’s high of 178 1/32 and then at 178 14/32. Shorter-term support lies at the overnight low of 176 13/32 and then at 176 even. Wyckoff’s Intra-Day Market Rating: 5.5

September U.S. T-Notes: Prices are slightly weaker in early U.S. trading. Bulls still have the solid near-term technical advantage as prices trade sideways at higher levels. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is even with the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term resistance lies at this week’s high of 138.30.5 and then at 139.03.0. Shorter-term technical support lies at 138.12.0 and then at 138.07.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5

U.S. DOLLAR INDEX

The September U.S. dollar index is firmer in early U.S. trading. Bears have the overall near-term technical advantage. The shorter-term moving averages for the dollar index are neutral early today, as the 4-day is above the 9-day. The 9-day is even with the 18-day moving average. Short-term oscillators for the dollar index are neutral to bearish early today. The dollar index finds shorter-term technical resistance at Tuesday’s high of 97.215 and then at this week’s high of 97.700. Shorter-term support is seen at this week’s low of 96.320 and then at 96.000. Wyckoff’s Intra Day Market Rating: 5.5

NYMEX CRUDE OIL

August Nymex crude oil prices are lower in early U.S. trading on a corrective pullback after hitting a nearly four-month high on Tuesday. A price uptrend is in place on the daily chart. The shorter-term moving averages are bullish early today as the 4-day is above the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral to bearish early today. Look for buy stops to reside just above technical resistance at the overnight high of $40.54 and then at this week’s high of $41.63. Look for sell stops just below technical support at $39.00 and then at $38.00. Wyckoff’s Intra-Day Market Rating: 4.0

GRAINS

US grain futures are a bit firmer in early U.S. pre-market trading. Corn and soybean bulls are fading this week. Wheat bears are firmly in control. Grain market bulls need a weather market to soon develop in the U.S. Corn Belt. Otherwise, grain futures prices will languish at best, or trend down and set new for-the-move lows at worst.

IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any traders and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.

Here is what the Commodity Futures Trading Commission
(CFTC) has said about futures trading (and I agree 100%):
1. Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.

Jim Wyckoff

See on the daily bar chart for August gold futures that prices are starting to trend higher and are now not far from the multi-year high hit this spring. Bulls have gained good momentum and new for-the-move highs are likely in the near term. Fundamentally, the rise in Covid-19 infections around the world are providing a safe-haven bid for the yellow metal.–Stay tuned! Jim

Tuesday, June 23–Jim Wyckoff’s Morning Markets Report

Global stock markets were mostly up in overnight trading. U.S. stock markets are pointed toward higher openings when the New York day session begins. Equities markets were lifted in part overnight following a tweet from President Trump that said the U.S.-China Phase 1 trade deal is still very much in place. This comes following and after-hours sell off after one of Trump’s top economic advisors, China-hawk Peter Navarro, on Monday evening suggested in a TV interview that the trade deal was off. Trump’s tweet a bit later prompted the rebound.

Trader and investor sentiment is also mostly upbeat amid recent data from major world economies that shows they are rebounding from the Covid-19 pandemic shutdowns much more rapidly than most expected. Overnight the Euro zone June flash composite purchasing managers index (PMI) was reported at 46.9 versus expectations for a reading of 40.0 and compares to May’s 31.9. A reading below 50.0 suggests contraction.

However, a disturbing rise in Covid infections in some parts of the world, including some U.S. states, is being watched very closely by the marketplace and could soon dent risk appetite. If the rates of infections continue to increase, the debate will intensify regarding shutting businesses back down. Such would deal a catastrophic blow to the now-recovering economies and would likely send stock markets careening lower. The gold market is presently getting a safe-haven bid on these notions.

The important outside markets today see Nymex crude oil prices higher and trading around $41.50 a barrel. The U.S. dollar index is weaker early today. The yield on the benchmark U.S. Treasury 10-year note is currently around the 0.68% level.

U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, the U.S. flash manufacturing and services PMIs, the Richmond Fed business survey, and new residential sales.

–Jim
!–more Continue Reading–>
U.S. STOCK INDEXES

September S&P 500 e-mini futures: Prices are higher in early U.S. trading. Bulls have the firm overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is even with the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bullish early today. Today, shorter-term technical resistance comes in at last week’s high of 3,156.25 and then at the June high of 3,179.00. Buy stops likely reside just above those levels. Downside support for active traders today is seen at the overnight low of 3,060.00 and then at Monday’s low of 3,027.25. Wyckoff’s Intra-day Market Rating: 6.0

September Nasdaq index futures: Prices are higher and hit a record high in early U.S. trading as the bulls are in firm control. Shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at the overnight record high of 10,204.50 and then at 10,300.00. On the downside, shorter-term support is seen at 10,000.00 and then at Monday’s low of 9,843.50. Wyckoff’s Intra-Day Market Rating: 7.0.

U.S. TREASURY BONDS AND NOTES FUTURES

September U.S. T-Bonds: Prices are down in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is even with the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at this week’s high of 178 1/32 and then at 178 14/32. Shorter-term support lies at 176 even and then at 175 even. Wyckoff’s Intra-Day Market Rating: 4.0

September U.S. T-Notes: Prices are weaker in early U.S. trading. Bulls have the solid near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is even with the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are bearish early today. Shorter-term resistance lies at Monday’s high of 138.30.5 and then at 139.03.0. Shorter-term technical support lies at 138.12.0 and then at 138.07.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.5

U.S. DOLLAR INDEX

The September U.S. dollar index is weaker in early U.S. trading. The shorter-term moving averages for the dollar index are neutral early today, as the 4-day is above the 9-day. The 9-day is even with the 18-day moving average. Short-term oscillators for the dollar index are neutral to bearish early today. The dollar index finds shorter-term technical resistance at the overnight high of 97.215 and then at Monday’s high of 97.700. Shorter-term support is seen at 96.500 and then at 96.250. Wyckoff’s Intra Day Market Rating: 4.5

NYMEX CRUDE OIL

August Nymex crude oil prices are higher and hit a nearly four-month high in early U.S. trading. A price uptrend on the daily chart has restarted. The shorter-term moving averages are bullish early today as the 4-day is above the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are bullish early today. Look for buy stops to reside just above technical resistance at the overnight high of $41.57 and then at $42.00. Look for sell stops just below technical support at $40.00 and then at Monday’s low of $39.00. Wyckoff’s Intra-Day Market Rating: 6.5

GRAINS

US grain futures are weaker in early U.S. pre-market trading. Corn and soybean bulls are fading this week and need a fresh spark. Wheat bulls are already on the ropes, seeing serious technical damage to also suggest that corn and soybeans will find it hard to sustain rallies. Grain market bulls need a weather market to develop in the U.S. Corn Belt and the clock is ticking as the most critical part of the growing season approaches for corn—early July.

IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any traders and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.

Here is what the Commodity Futures Trading Commission
(CFTC) has said about futures trading (and I agree 100%):
1. Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.

Jim Wyckoff

Monday, June 22–Jim Wyckoff’s Morning Markets Report

Global stock markets were mixed to weaker in overnight trading. U.S. stock markets are pointed toward higher openings when the New York day session begins. Traders and investors continue to weigh the positive aspect of economies continuing to come back to life and at a faster pace than most expected versus the negative aspect of a worrisome rise in Covid-19 cases worldwide, including in many states in the U.S. Importantly, the sense of the marketplace is that major central banks of the world will continue to print money if global economies show further signs of sputtering. This influx of cash into the global financial system is also supporting stock market gains despite the still seriously hobbled major economies. Many are wondering how long it will take for the negative consequences of all that easy money to show up in economies.

The important outside markets today see Nymex crude oil prices near steady and trading around $39.75 a barrel. The U.S. dollar index is weaker early today. The yield on the benchmark U.S. Treasury 10-year note is currently around the 0.7% level.

U.S. economic data due for release Monday includes the Chicago Fed national activity index and existing home sales.

–Jim
!–more Continue Reading–>
U.S. STOCK INDEXES

September S&P 500 e-mini futures: Prices are higher in early U.S. trading. Bulls have the firm overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is even with the 9-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 resistance comes in at last week’s high of 3,156.25 and then at the June high of 3,179.00. Buy stops likely reside just above those levels. Downside support for active traders today is seen at the overnight low of 3,027.25 and then at 3,000.00. Wyckoff’s Intra-day Market Rating: 6.0

September Nasdaq index futures: Prices are higher in early U.S. trading as the bulls are in control with prices close to the recent record high. Shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at the record high of 10,140.00 and then at 10,250.00. On the downside, shorter-term support is seen at the overnight low of 9,843.50 and then at 9,700.00. Wyckoff’s Intra-Day Market Rating: 6.5.

U.S. TREASURY BONDS AND NOTES FUTURES

September U.S. T-Bonds: Prices are firmer in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is even with the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at the overnight high of 177 24/32 and then at 178 even. Shorter-term support lies at 177 even and then at Friday’s low of 176 2/32. Wyckoff’s Intra-Day Market Rating: 5.5

September U.S. T-Notes: Prices are near steady in early U.S. trading. Bulls have the solid near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term resistance lies at the overnight high of 138.29.5 and then at 139.00.0. Shorter-term technical support lies at 138.20.0 and then at 138.16.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 5.0

U.S. DOLLAR INDEX

The September U.S. dollar index is weaker in early U.S. trading. The shorter-term moving averages for the dollar index are neutral early today, as the 4-day is above the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at last week’s high of 97.700 and then at 98.000. Shorter-term support is seen at 97.000 and then at 96.765. Wyckoff’s Intra Day Market Rating: 4.5

NYMEX CRUDE OIL

August Nymex crude oil prices are near steady in early U.S. trading. A price uptrend on the daily chart appears to be restarting. The shorter-term moving averages are bullish early today as the 4-day is above the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are neutral to bullish early today. Look for buy stops to reside just above technical resistance at the overnight high of $40.17 and then at the June high of $40.69. Look for sell stops just below technical support at the overnight low of $39.00 and then at $38.00. Wyckoff’s Intra-Day Market Rating: 5.0

GRAINS

US grain futures are weaker in early U.S. pre-market trading. Bulls have stabilized the corn and soybean markets but wheat prices have seen serious technical erosion—so much so that corn and soybeans will find it hard to sustain rallies, too. Grain market bulls need a weather market to develop in the U.S. Corn Belt and the clock is ticking as the most critical part of the growing season approaches for corn—early July. On tap Monday is the weekly USDA export inspections report.

IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any traders and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.

Here is what the Commodity Futures Trading Commission
(CFTC) has said about futures trading (and I agree 100%):
1. Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.

Jim Wyckoff

See on the daily bar chart for December corn futures that prices are in a gentle uptrend. However, the market is languishing at lower price levels and will likely continue to do so without a significant weather scare developing in the Corn Belt this summer. More years than not, some degree of a weather market does occur in the grain futures during the planting and growing seasons. If you’d like to read my “Fear and Greed in a Weather Market” story I wrote a few years back, I’d be happy to email it to you. Just send me an email at jim@jimwyckoff.com.–Stay tuned! Jim

Friday, June 19–Jim Wyckoff’s Morning Markets Report

Global stock markets were mostly up in overnight trading. U.S. stock indexes are pointed toward higher openings when the New York day session begins. Recent, surprisingly upbeat economic data from the U.S. and other countries continue to stoke trader and investor confidence and risk appetite. And there are perceptions that central banks are at the ready with even more monetary stimulus should the need arise.

Friday is quadruple-witching day in the U.S. stock market, whereby stocks, stock options, options on futures and stock index futures contracts expire. History shows these days can produce higher volatility in the stock market.

Lingering in the background of the marketplace at present is the inflammatory rhetoric coming out of North Korea, including that rogue nation blowing up a building near its border with South Korea. Don’t be surprised if this becomes a front-burner marketplace matter in the coming weeks or few months.

Nymex crude oil prices pushed above $40 Friday morning, providing another clue that this important outside market has recovered from its April meltdown and that world economies will recover faster than expected. The other key outside markets early today see the U.S. dollar index near steady. The yield on the benchmark U.S. Treasury 10-year note is currently around the 0.73% level.

U.S. economic data due for release Friday is light and includes international transactions and the current account. Several Federal Reserve officials are slated to give speeches today.

–Jim
!–more Continue Reading–>
U.S. STOCK INDEXES

September S&P 500 e-mini futures: Prices are higher in early U.S. trading. Bulls this week have recovered well from last week’s sell off and working to restart a price uptrend. The shorter-term moving averages (4-, 9- and 18-day) are neutral early today. The 4-day moving average is even with the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are neutral to bullish early today. Today, shorter-term technical resistance comes in at this week’s high of 3,156.25 and then at 3,177.75. Buy stops likely reside just above those levels. Downside support for active traders today is seen at the overnight low of 3,094.75 and then at Thursday’s low of 3,064.50. Wyckoff’s Intra-day Market Rating: 6.0

September Nasdaq index futures: Prices are higher in early U.S. trading as the bulls are also recovering well from late last week’s price pressure and are very close to the recent record high. Shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are bullish early today. Shorter-term technical resistance is seen at the record high of 10,140.00 and then at 10,250.00. On the downside, shorter-term support is seen at the overnight low of 9,979.75 and then at 9,800.00. Wyckoff’s Intra-Day Market Rating: 6.5.

U.S. TREASURY BONDS AND NOTES FUTURES

September U.S. T-Bonds: Prices are lower in early U.S. trading. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is above the 9-day. The 9-day is even with the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term technical resistance is seen at the overnight high of 177 7/32 and then at 178 even. Shorter-term support lies at Thursday’s low of 175 30/32 and then at this week’s low of 174 29/32. Wyckoff’s Intra-Day Market Rating: 4.0

September U.S. T-Notes: Prices are down in early U.S. trading. Bulls still have the solid near-term technical advantage. Shorter-term moving averages (4- 9- 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral early today. Shorter-term resistance lies at Thursday’s high of 138.28.0 and then at 139.00.0. Shorter-term technical support lies at Thursday’s low of 138.16.0 and then at this week’s low of 138.07.0. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 4.0

U.S. DOLLAR INDEX

The September U.S. dollar index is slightly up in early U.S. trading. The shorter-term moving averages for the dollar index are neutral early today, as the 4-day is above the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators for the dollar index are bullish early today. The dollar index finds shorter-term technical resistance at this week’s high of 97.550 and then at 98.000. Shorter-term support is seen at 97.000 and then at 96.765. Wyckoff’s Intra Day Market Rating: 5.5

NYMEX CRUDE OIL

July Nymex crude oil prices are higher in early U.S. trading. A price uptrend on the daily chart appears to be restarting. The shorter-term moving averages are bullish early today as the 4-day is above the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are bullish early today. Look for buy stops to reside just above technical resistance at the June high of $40.44 and then at $45.00. Look for sell stops just below technical support at the overnight low of $38.76 and then at $38.00. Wyckoff’s Intra-Day Market Rating: 6.5

GRAINS

US grain futures are firmer in early U.S. pre-market trading, on short covering. Bulls have stabilized the corn and soybean markets this week but wheat prices have seen serious technical erosion—so much so that corn and soybeans will find it hard to sustain rallies, too. Grain market bulls need a weather market to develop in the U.S. Corn Belt and the clock is ticking as the most critical part of the growing season approaches for corn—early July.

IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any traders and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.

Here is what the Commodity Futures Trading Commission
(CFTC) has said about futures trading (and I agree 100%):
1. Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.

Jim Wyckoff