Soybeans: I am still long the November soybean futures contract from $4.46. However, since the last newsletter, the technical and fundamental picture has deteriorated. We had a gap-lower trade and big down day last Friday that inflicted some technical damage on the daily bar chart. Fundamentally, the weather forecasts late this week have favored the bears. Also, a lousy USDA export sales report today (Thursday) added to the bearish tone of the market. Still, prices were able to hold just above support at the $4.38 level. After the close today I adjusted my protective sell stop in beans down by 3 cents, to $4.34. Reason: With prices hovering close to support, which is just above where my stop was located at $4.37, I did not want to see a wide opening range in prices on Friday morning stop me out, only to possibly see prices rebound heading into the weekend and the all-important weekly crop progress reports on Monday. Note that the popular Moving Average Convergence Divergence (MACD) indicator, seen at the bottom of the chart, remains in a bullish mode, but has turned down from higher levels.

Corn: New-crop December corn futures are trapped in a down-trending channel, as seen on the daily bar chart. Weather is deemed favorable for crop development, as of this writing at midday Thursday, and that has the bears in firm control. Prices are hovering just above recently established contract lows. There has been a lot of negative news factored into the corn market, but if the U.S. Corn Belt weather turns out to be ideal in the coming weeks, corn will see more downside price pressure. One wild card is the critical corn pollination period that lasts a few days in mid- to late-July. If temperatures in the mid- to upper-90s hit the Corn Belt, along with some dry winds during that timeframe, then bulls will come to life in a hurry.

Chicago Wheat: Harvest pressure has whacked wheat hard recently. Prices have scored new contract lows this past week, and that's where prices are hovering--near the contract lows. Slack export demand along with the harvest pressure paints a very bearish fundamental picture. However, I suspect much of this bearish news is being factored into prices, and that it's going to take even more fresh bearish news to fuel further losses. That may indeed happen. But there is a ray of hope for the bulls. Let's take a look at the December Chicago wheat contract. See that a falling wedge pattern has developed on the daily bar chart. These wedge formations are usually bullish, according to classic textbook technical analysis. Given the beating that wheat has taken recently, my bias is that this pattern stands a better chance of playing into a bullish scenario in the coming weeks and months.

Coffee: The lack of any frost in Brazilian coffee-growing regions has put more downside pressure on the New York coffee futures market. The weather has been chilly overnight in Brazil, but not chilly enough to cause any frost damage. The September futures jabbed to a new contract low this week. Longer-term resistance at the 58-cent level did check the declines. There is just not much on which the bulls can pin their hopes in this market, at present. Do note that the Bollinger Bands indicator, seen on the chart, does show this week's jab lower touched the lower B-Band. Looking back the past several months, see that only a very few times have prices poked down below that lower B-Band. This does suggest prices are due for at least a near-term corrective bounce higher.

Crude Oil: Bears have seized control of the energy complex this week. Bearish API, AGA and DOE inventories data combined with a negative technical picture to drive futures prices sharply lower. The August NYMEX crude oil contract, seen here, shows a classic Head & Shoulders Top reversal pattern that has developed on the daily bar chart. Measuring implications of this formation point to potential losses into, or just below, the wide support zone seen on the chart. The falling crude oil and grains complexes have driven the CRB Index to lows not seen since early in the year 2000.

Gold: The past few weeks have seen the New York COMEX gold futures come to life. The weekly continuation chart for nearby gold futures, seen here, shows how prices broke out on the upside of a large falling wedge pattern. Falling wedges are usually bullish. The spike higher to nearly $300 per ounce was very rapid, and prices backed right off. While this certainly disappointed the bulls, I don't think their quivers are empty just yet. This increase in volatility at lower price levels and the ability of prices to hang right around the $275 area should give the bulls some encouragement. Indeed, the bears are now leery enough that they are not eager to pounce on each rally--as has been the case the past several months. Bulls will need to see prices close and hold above $275 to gain more momentum. This should be their next objective. If that occurs, then they will set their sights on the resistance area around $282. Bears will regain confidence if they can push prices back below $265.

U.S. Dollar Index: The U.S. Dollar Index has recently moved to a 14-year high. The persistent strength of the greenback has been a thorn in the sides of U.S. agricultural commodity bulls as well as currency futures bulls. By looking at the monthly continuation chart for nearby dollar index futures, one sees that prices have just recently pushed above the high seen late last year. This is more technical evidence of the dollar index strength. The currency futures trading landscape is littered with the carcasses of would-be bottom pickers in the Euro currency, Swiss franc and Japanese yen. The ag and currency bulls will want to wait for the dollar index to show some signs of a significant technical breakdown before they can get too confident. Last week, the September dollar index did gap lower and then see some follow-through weakness, only to see prices come roaring right back and fill that gap this week.

Canadian Dollar: This currency has been one of the few stellar performers against the dollar the past several weeks. A look at the September futures contract shows that prices are in a solid 2.5-month-old uptrend on the daily bar chart. Yes, there have been some decent downside corrections recently, but the trendline support has checked the declines each time. While bulls have the edge, they won't gain much more punch until they can push prices above the recent high that came in just below .6600.

T-Bonds: The bond market bulls have recently gained significant momentum. Let's take a look at the weekly continuation chart for nearby U.S. Treasury bond futures. A double-top reversal pattern developed and has played out, and now we've seen a minor V-Bottom reversal develop on the weekly chart. As bulls and bears struggle to gain more control in this market, my bias is that neither will gain much over the near term. It will take a move solidly above 102 even to get the bulls charged up. September futures popped above 102 today, but could not hold above that level. A push below "par" at 100 even gives the bears more of an advantage. Summertime doldrums could be the market tenor in the coming weeks.

S&P 500: The U.S. stocks indexes are not unlike the bond market: the bears have the slight edge, but neither camp has displayed any overwhelming power recently. A look at the weekly continuation chart for nearby S&P 500 futures shows how the recent spike higher was met with strong selling interest as prices backed off the May high. Note at the bottom of the chart how the popular Moving Average Convergence Divergence (MACD) indicator has been in bearish territory since last fall. This indicator is a good longer-term barometer of a market's health. My bias is that the U.S. stock indexes won't show much trending action the next several weeks, and instead will find choppy conditions and the bears with the slight edge.

A main tenet of success in futures trading is the ability to accept losing trades as part of the overall trading process. This is not an easy undertaking--especially since many futures traders tend to be of a more competitive nature in the first place. Traders certainly don't have to enjoy having losing trades, but they must accept the fact and move on. Those who can't accept the fact that losing trades are a part of futures trading usually don't stay in the business very long.

My wife is a school teacher, and one of her favorite acronyms--ADM--can be applied to losing futures trades. "Accept" it. "Deal" with it. "Move" on. (This is a part of the important psychological aspect of trading, and deserves much more discussion than I can provide in this feature.)

I had lunch with one of my trading mentors a while back. We discussed losing trades. I asked my mentor how many losing trades in a row he has had to endure during his long trading career. His reply was 13 in a row. I asked him how he coped with that. He said that while it was certainly not easy, he knew that losing trades are a part of the business and that he was in the business "for the long haul," and that his trading methodology was sound. He added, "Ninety-percent of futures trading profits are made on 10% of the trades, which means most of the other trades are either small losers or break-even-type trades. This is an important fact for all traders to keep in mind.

My lunch meeting with my mentor was good for me because, even though we made no "break-through" discoveries on the path to increased futures trading success, we did reaffirm our own philosophies on trading and markets. My passion for trading and market analysis is fed immensely every time I talk with people in my profession, or attend the quality trading seminars.

For many of you, the futures trading arena can be more fulfilling (and more fun) if you have someone, or some support group, with which to share your thoughts and strategies. If you are passionate about futures trading and markets, finding someone who shares that passion is a great trading tool within itself!

That's it for now. Next time, we'll discuss another important issue on your path to trading success.

Disclaimer: There is a risk of financial loss in futures and options trading. Futures trading is neither easy nor an easy way to make money. It takes hard work to have success. Please use sound money management when trading futures. Past performance is not necessarily indicative of future results. Nothing in this newsletter is intended to be a trading recommendation for you to buy or sell futures or options. All information has been obtained from sources believed to be reliable, but accuracy is not guaranteed. Readers are solely responsible for how they use the information in this newsletter.