User [gary fullett /172.139.244.240] joined forum on Thu Jul 06 20:58:26 EDT 2000
<gary fullett> good evening
<mrj> Hi Capt and Gary
<gary fullett> how is everyone tonight?
<Capt> Hi guys
<mrj> ok
<Capt> great
User [mrj] left forum on Thu Jul 06 20:59:31 EDT 2000
<gary fullett> great I will wait a few minutes before beginiing okay?
<Capt> Ok
User [mrj /209.16.79.112] joined forum on Thu Jul 06 20:59:59 EDT 2000
<gary fullett> give me 3 minutes and we will begin okay?
<mrj> k
User [mrj] left forum on Thu Jul 06 21:01:30 EDT 2000
User [mrj /209.16.79.112] joined forum on Thu Jul 06 21:01:56 EDT 2000
<gary fullett> okay I am back sorry
<gary fullett> any quetions?
<gary fullett> I want to chat a bit about the grains before they get to zero?
<gary fullett> lol
<mrj> :)
<gary fullett> this maket has been very interesting
<gary fullett> since the made the highs in late april and early May
<gary fullett> obviously
<gary fullett> the market turned from being bullish to being very bearish
User [Frank /63.160.52.234] joined forum on Thu Jul 06 21:05:37 EDT 2000
<gary fullett> I would imagine
<gary fullett> that the funds are short
<gary fullett> anf this level
<mrj> hi Frank
<gary fullett> looking for lower prices
<gary fullett> the volume
<Frank> hi mr J how are u today?
<gary fullett> still is indicating supply
<gary fullett> with litle demand being evident at this level
<mrj> good Frank
<Frank> a question gary when u can answer?
<gary fullett> please ask Frank
<Frank> why are the december contracts in cotton higher volumn than the forward contracts?
<gary fullett> it is the lead month
<Frank> wyhat is October?
<Frank> what
<gary fullett> a bad month for cotton
<Frank> ok
<gary fullett> July is a fairly active
<gary fullett> month
<gary fullett> the new crop cotton
<gary fullett> is december
<Frank> ic
<gary fullett> and cotton in october I believe is part new crop part old crop
<gary fullett> like sept beans
<Frank> i noticed that to
<gary fullett> after july beans nov becomes the most active for the same reason
<gary fullett> because Nov is the last
<Frank> Ic
<gary fullett> Nov is the first month
<gary fullett> of new crop
<gary fullett> and sept is part new part old crop beans
<gary fullett> like Oct cotton
<gary fullett> so poelle tend to trade
<Frank> I c
<gary fullett> people
<gary fullett> trade the new crop
<gary fullett> so after july cotton most people trade December
<gary fullett> like after July beans
<gary fullett> Nov then is the most active
<gary fullett> Okay?
<mrj>
<Frank> yes thanks
<Capt> Thanks for that explanation! I liked it! Clears uo a few questions I had.
<gary fullett> great
<gary fullett> I try t be through
<Frank> where is amos?
<gary fullett> because alot of people read the logs
<gary fullett> and they email me
<gary fullett> and ask questions from the log
<gary fullett> so if i explain more fully
<gary fullett> it helps everyone
<gary fullett> the log goes out to 300 people
<gary fullett> Amos.. he computer crashed yesterday
<gary fullett> and he couldnt get charts
<gary fullett> and todat the whole computer broke down
<gary fullett> so he wont be on line till next week
<gary fullett> I chatted with him earlier today
<gary fullett> he feels lost with out his charts
<Frank> I wanted to know if what i wrote him was what he wanted
<Frank> amos i mean
<gary fullett> i dont know what you wrote him
<Frank> ok
<gary fullett> grains:
<gary fullett> the low last yr in Nov benas I believe was at the 453 area
<gary fullett> today we got close to that level I would assume that that level
<gary fullett> will be tested
<gary fullett> it will be interesting what the market does if it tests this area
<gary fullett> It is interesting there is NOT 1 piece on news that is bulish grains
<Capt> Is somebody accumulating?
<gary fullett> so any surprises to me ould be to the upide
<gary fullett> Capt that is a very good question
<Frank> buy the bad news
<gary fullett> I wouild assume not at this poinst
<gary fullett> utill we see a selling climax
<gary fullett> we havent seen that
<gary fullett> so it appears
<gary fullett> that we need to see a selling climax for the down move to end
<gary fullett> does this make sense?
<Capt> yes
<gary fullett> it would be interesting if they had this selling climax against monthly support
<Frank> yep, be prepared too buy the bad news!
<Capt> Is that at 450
<gary fullett> they can spring the support at 450 area
<gary fullett> and take it down to 440-430 area
User [wyatt /166.93.111.133] joined forum on Thu Jul 06 21:22:22 EDT 2000
<gary fullett> then an ar then a trading range
<gary fullett> then a rally
<gary fullett> but I think the grains need to see a seliing climax
<mrj> the low of 12-17-99 was 446 1/4 and seems critical
<gary fullett> to end this down move
<mrj> that's on the continuation chart
<gary fullett> and that would make lots of sense to go to that level
<gary fullett> and possibly spring it
<gary fullett> as the selling climax...
<mrj> from there it looks straight down to 401 1/2 of 7-9-99
<gary fullett> yes I fully agree with you Mr J
<gary fullett> 450 area
<gary fullett> then 400 bucks
<gary fullett> I think at this level grains
<gary fullett> need to be looked at very very carefully
<gary fullett> we will watch it into net week
<gary fullett> next
<gary fullett> the volume
<gary fullett> nees to be watched here
<gary fullett> as well as the price action>
<mrj> would you consider the period 6-26 to 6-30 as possibly Preliminary Support
<gary fullett> that is what amos thought
<gary fullett> as u may recall
<gary fullett> I wasnt so sure
<gary fullett> but it may be
<gary fullett> it would seem logical
<gary fullett> with the areas of support that we mentioned
<mrj> CM needs to cover shorts somewhere :)
<gary fullett> previously in beans
<gary fullett> I would imagine
<gary fullett> that they would start to buy on the seling cliamx
<gary fullett> or the PS at the end of june
<gary fullett> then acccumalte duriing the trading range
<gary fullett> it is hard to see where the demand has come in in beans and
<gary fullett> corn especailly
<gary fullett> but it interesting
<gary fullett> because when the stock market crashed in 87
<gary fullett> and broke all supports
<gary fullett> when everyone
<gary fullett> went back to the charts
<gary fullett> it did go to a major support
<gary fullett> when other support were broken
<gary fullett> so the key areas now are the areas
<gary fullett> that MR Mnetioned
<gary fullett> Mr J mentioned sorry
<gary fullett> so there always is a support
<gary fullett> that few poeple see
<Frank> what effect did the stockmarket crash in 87 have on the crb and the grains?
<gary fullett> great question
<gary fullett> I dont remeber
<gary fullett> I know the bonds went limut up
<gary fullett> I think the grains went down if I am not mistaken
<gary fullett> generally
<gary fullett> when u see a stock market melt down
<gary fullett> or crash people tend to flock into crash
<gary fullett> I mentione that I would talk about the crash
<gary fullett> when I was on the floor
<gary fullett> would u like to hear what I think happened
<gary fullett> or not interested?
<wyatt> y
<Capt> Don't forget that you were going to tell us a story about the $300's you made yesterday also
<Frank> interested how about u mr mJ?
<mrj> Gary would you consider the 453 low of 7-9-99 and today's low of 457 1/2 as a double bottom ( non-Wyckoff)
<Capt> tell us
<gary fullett> in the crash I made 300 doloar cat that money?
<gary fullett> yeah I would Mr J
<mrj> hi wyatt
<mrj> ok
<gary fullett> I think though they may go to test 453 again
<gary fullett> maybe lower to spring it
<wyatt> hi mrj :)
<gary fullett> but i think this area is critical
<mrj> agree
<gary fullett> so I want to focus on it the next several days
<gary fullett> okay I will mention the crash
<gary fullett> since we all agree
<gary fullett> and I think it will be interesting
<gary fullett> the market started a bull market in 1982
<gary fullett> and the market went up
<gary fullett> till 86
<gary fullett> then the market had a mini crash
<gary fullett> this to me was some sort of PSLY
<gary fullett> premlinary supply
<gary fullett> then the market went up
<gary fullett> obviouly most were bullish
<gary fullett> by the way Richard dennis in the 86 mini crash got hurt being long
<gary fullett> I know I was working with him and got hurt
<gary fullett> several days before the crash
<gary fullett> many influentail people
<gary fullett> that will remain nameless we getting short
<gary fullett> I was able to see this
<gary fullett> in the pit
<gary fullett> and I had a friend that executed thier trades
<gary fullett> but the market was going up and everyone laughed that
<gary fullett> they were short
<gary fullett> and losing money
<gary fullett> several days before the crash the market started sneaking lower
<gary fullett> voluime picked up in the ppit
<gary fullett> then the market broke hard that day and people scrambled
<gary fullett> all day in fact we in the pit didnt know what hundreds were were trading at
<gary fullett> they were going down so fast
<gary fullett> it was the scariest day in the pit
<gary fullett> I watched as I could nt believe it was happening
<gary fullett> I traded the cosing range and made 300 bucks
<gary fullett> what I want to explain
<gary fullett> and what i find the interesting part of the story is why i think the crash happend
<gary fullett> the CM was short there is No doubt in my mind about this
<gary fullett> people as I said who were influential were short
<gary fullett> and must have been tiped off by a decline in the amrket
<gary fullett> market
<mrj>
<gary fullett> when the market started to break hard
<gary fullett> the CM' s role is to cover thier shorts right?
<gary fullett> well if you know anything about the specailists
<gary fullett> in NY
<gary fullett> they are like a grocery store
<gary fullett> but they sell
<Capt>
<gary fullett> stock instead of groceries
<gary fullett> so on balance they are short
<gary fullett> as most people buy stock
<gary fullett> rather than sell stock
<gary fullett> with me so far?
<Capt> yes
<wyatt> yes
<mrj> y
<gary fullett> great
<gary fullett> so as the market was breaking
<gary fullett> the cm specailist were covering
<gary fullett> but as the market
<gary fullett> continued to break guess what happened
<gary fullett> more people sold thier stocks
<gary fullett> who do u htink bought them?
<Capt> The cms started to buy
<gary fullett> right and the specailists
<gary fullett> but the specialists is what i will focus on now
<gary fullett> they are traders that are well funded
<gary fullett> so as the public and funds sold they specialists bought
<gary fullett> so the specailist at some point covered thier shorts
<gary fullett> but the market was still breaking so instead of the
<gary fullett> specialists covering his shorts
<gary fullett> and being flat he
<gary fullett> was
<gary fullett> forced
<gary fullett> tto be long
<gary fullett> but as I mentioned before the specialist
<gary fullett> is gnerally short
<gary fullett> so he was in an usual position
<gary fullett> as the market broke he was more long
<gary fullett> well he has to pay for the shares he buys
<gary fullett> and he was accumaulting ( not on purpose)
<gary fullett> lots of stock sold by funds and the publis
<gary fullett> public
<gary fullett> if you didnt know it Funds MUST
<gary fullett> sell at certian levels
<gary fullett> when their program says so
<gary fullett> so lets say the dow gets to 10k
<gary fullett> they sell
<gary fullett> if it gets to 9700
<gary fullett> they are forced to sell more
<gary fullett> all complaines
<gary fullett> have their own paramters
<gary fullett> so far so good?
<Capt> y
<Frank> y
<wyatt> y
<gary fullett> Okay
<mrj> y
<gary fullett> so the short sales by the specailsist
<gary fullett> backfired
<gary fullett> because now they were forced being long in a down market
<gary fullett> one they created but this time it wasnt controled
<gary fullett> so they were...... fill in your own word there :)
<gary fullett> it was so bad that they recieved margin calls
<gary fullett> as they couldnt afford them
<gary fullett> well u can say screw them
<gary fullett> because they make lots of money and it is okay if they get hurt
<gary fullett> but they help liquidity
<gary fullett> so u dont mind if they lose money but they cant get killed
<gary fullett> so they had this stock they didnt want and the market was going lower
<gary fullett> and at certian levels funds and brokerage
<gary fullett> sold
<gary fullett> at any level
<gary fullett> we in the pit had no ideas was was happening
<gary fullett> as soon as the selling seemed to stop for a second
<gary fullett> another fim or fund would sell
<gary fullett> well at that time 25k was all that was needed to be on the floor of the exchange
<gary fullett> so the pit traders were undercapilatize as well
<gary fullett> I mentioned to a trader
<gary fullett> when the market was down 100 points which was a large move then
<gary fullett> as the daily ranges was only about 50 points a day
<gary fullett> dow points
<mrj>
<gary fullett> that i thought as a joke the market would go down 500 points
<gary fullett> as it seemed so heavy
<gary fullett> the next day newspaper came to me and said I called the crash
<gary fullett> I told them they were crazy
<gary fullett> that I was joking and didnt mean anything by it
<gary fullett> and I made a whppoing 300 bucks
<gary fullett> well if u recall the market stopped trading
<gary fullett> for about an hour when it went into a free fall the next day
<Capt>
<Frank>
<gary fullett> all the brokerage firms presidents came to the floor and offerrd to BUY any
<gary fullett> contracts that the floor wanted to sell
<gary fullett> if u were long and getting hurt the brokerage firms president would buy them from u
<gary fullett> so most traders sold got out and waited for the market to reopend
<gary fullett> reemmeber there were
<gary fullett> marginn calls for the specailists
<gary fullett> how do they survivve
<gary fullett> if th amrket keeps going lower
<gary fullett> markert
<gary fullett> they are long getting killed
<gary fullett> the intergrity
<gary fullett> of the exchange is Now in jepordy
<gary fullett> they HAD to conduct a rally
<gary fullett> in order for the specailist to get out
<gary fullett> with as little loss as possible
<gary fullett> so the market closed
<gary fullett> when it repopened
<gary fullett> it sharply rallied
<gary fullett> I wondered why?
<gary fullett> the speacailists
<gary fullett> who conducted a down move in the amrket
<gary fullett> market
<gary fullett> scared others into selling
<gary fullett> and instead of profiting
<gary fullett> they ended up
<gary fullett> being long in a horrific down move
<gary fullett> and they were at the risk of beinfg wiped out
<gary fullett> many were by the way
<gary fullett> so the rally was faslely
<gary fullett> conducted
<gary fullett> as well as the original break
<gary fullett> so s U can see markets ( stocks) can be manipluted
<gary fullett> did I bore you?
<Capt> never
<gary fullett> I wanted to point out the cm and specialists
<gary fullett> their control but this time they lost control
<gary fullett> and had to intervene in order
<gary fullett> to save
<Capt> to be a specialist on that day had to be the worst
<gary fullett> when the presidents of the brokerage firms BOUGHT
<gary fullett> that was the Bottom
<gary fullett> it was capt
<gary fullett> how did they know it was a bottom?
<Capt> talk about having a tiger by the tail and not being able to let go
<gary fullett> if i didnt see it I wuldnt jave belived it
<wyatt> George Angell said in his book that they were selling large orders at any price just to get short the market .
<gary fullett> that is very true
<gary fullett> and that is what I menat
<gary fullett> that it happened in waves
<gary fullett> and that they were forced when the market went thru
<gary fullett> certian supports
<gary fullett> when it went thru certian levels
<gary fullett> they sold at any levels
<Capt> the specialist must have been dumbfounded as it was happening
<gary fullett> yes
<gary fullett> they wanted the amrket to go down
<gary fullett> market
<gary fullett> and it did
<gary fullett> but they went thru supports
<gary fullett> and people were forced to sell
<gary fullett> they over did the break
<gary fullett> and lost control
<Frank> there was a lot of finger pointing at computers as i remember
<wyatt> he also made the comment that at times u didn't know where the price was
<gary fullett> the point of the story is the way the Cm and specialsit control the markets
<wyatt> scarry
<gary fullett> But this one case they couldnt control it
<gary fullett> but they gained control when they needed to by conducting a rally
<gary fullett> wyatt
<gary fullett> I didnt know whicjh thousands we were trading in the pit
<gary fullett> there were 2000 dollars swings
<gary fullett> so that is true wyatt
<gary fullett> so they knew the bearish news
<gary fullett> profitited
<gary fullett> from it
<gary fullett> and they got hurt by their own sword
<gary fullett> as they were forced to get log
<gary fullett> and that wasnt thier intention
<gary fullett> any questions?
<gary fullett> comments?
<Capt> thanks for the story
<gary fullett> I hope it interested u
<Frank> y
<gary fullett> the cm
<Capt> nice to here it from someone that was there
<wyatt> thanks. sir
<gary fullett> will always have a story after the fact
<gary fullett> that is why it is important to watch a mrket build some cause the
<gary fullett> CM is biding his time for a move to occur
<gary fullett> so he will build cause till he can coordiante to a news event
<gary fullett> otherwise it will stay in arange
<gary fullett> so wayching amrket build cause is very important
<gary fullett> because u know at ne point
<gary fullett> the news will come out after a jump over the creek or a break thru the ice
<gary fullett> so u must watch price action and volume
<gary fullett> in order to see if the markket is showing demand or supply
<gary fullett> like todays nasdaq market
<gary fullett> it was weak early
<gary fullett> then rallied
<gary fullett> but it rallied thru support
<gary fullett> after its lows
<gary fullett> and it went to the top end of resisatnce
<gary fullett> but the volume and price action showed that demand was overtaking supply
<gary fullett> it rallied faster than it broke
<gary fullett> and with heavier volume
<gary fullett> and wider price action
<gary fullett> so demand
<gary fullett> overtookd supply at this level
<gary fullett> and the whole day changed trend
<gary fullett> and the market had a sharp rally
<gary fullett> markets are always
<gary fullett> testing support resistance
<gary fullett> and seeing which way the path of least resistance
<gary fullett> the pit trader does this too
<gary fullett> he may sell 10 contrats
<gary fullett> if the pit eagerly buys them
<gary fullett> he know that the market is goijg up and he is wrong
<gary fullett> if he has a hard time selling 10 contracts demand
<gary fullett> is weak and it is going lower
<gary fullett> so he tests
<gary fullett> the market to see
<gary fullett> like bobbing bait in the water
<gary fullett> so markets are alays testing to find direction
<gary fullett> in the case of the stock market this testing
<gary fullett> can happen every 5 15 30 minutes
<gary fullett> in most markets it takes place over several days
<gary fullett> do es this make sense?
<gary fullett> do u understand?
<Frank> y
<Capt> y
<wyatt> yes
<gary fullett> so watch price action volume
<gary fullett> demand supply support resistance
<gary fullett> that is what wyckoff is all about
<gary fullett> watching market behavior
<gary fullett> and determining strenghth and weakness
<gary fullett> this is why i think wyckoff is important in trading
<gary fullett> as it is
<gary fullett> watching thr markets behaviour
<gary fullett> No tricks
<gary fullett> gimmicks
<gary fullett> rsi adx ect..
<Frank>
<gary fullett> just watching the CM intentions
<gary fullett> and watching big money\
<gary fullett>
<gary fullett> the popele in the know intentions
<gary fullett> they usually lead a rod map for us to follow
<gary fullett> u cant follow news beause u never know when in the chain u know the news
<gary fullett> so watch the market
<gary fullett> and u will know the news.
<gary fullett> any questions? comments?
<gary fullett> ohteriwse lets start fresh next week
<gary fullett> and lets focus on the grains here
<gary fullett> okay?
<Capt> thanks and good night
<gary fullett> I will see you all next Monday
<Frank> good nite
<gary fullett> good night
User [Frank] left forum on Thu Jul 06 22:38:55 EDT 2000
User [Capt] left forum on Thu Jul 06 22:38:55 EDT 2000
<gary fullett> see you ll on monday
<gary fullett> and have a great weekend
User [gary fullett] left forum on Thu Jul 06 22:39:04 EDT 2000