Floyd Upperman & Associates
Daily Evening HOTpage Report
11/03/04
(ALERT! Due to a flaw in the software, the above date stamp may be reported incorrectly in older
reports (pre 2000). The actual date of the report always corresponds to the file-date-name
displayed on the report page which you click on to pull up the report)

Please remember that commodity trading is risky and past performance in no guarantee of future results. There are no promises or guarantees made in this report whatsoever. In addition, futures trading is not suitable for everyone. The information provided herein are the opinions of the author. While every effort is made to ensure the integrity and accuracy of the data, no promises or guarantees are made.

"It is more likely the truth will be discovered by few than by many"
Rene Descartes

"Advances are made by answering questions.
Discoveries are made by questioning answers."
Bernard Haisch

From the Desk of Floyd W. Upperman Jr.
My new email address is floyd@upperman.com.

The U.S. election is over and we have a clear winner! Republican President George W. Bush won both the popular and the electoral vote and the market (Equities) appear to like it! The Republicans also scored big in the US Congress, adding up to four more seats to the 51 they already controlled in the 100-member Senate. In the House of Representatives, Republicans are also set to add at least five seats to the 227 they held in the outgoing 435-member body. This should give President Bush plenty of room to maneuver for the next 4 years (should see less gridlock).

Overall the stock market appears to like today's Republican victory. The Dow finished higher by more than 100 points.

Friday's employment Report Forecast:

Nonfarm payrolls Consensus Forecast for Oct 2004 are 160,000.
The Range is 85,000 to 225,000.
* 180k and higher will be supportive for the market in my opinion.

We had several plunger formations today (total of 9). All of them were forward plungers (no reverse plungers). Energy was the most interesting as we had 3 forward plungers there (CL, HO, and HU). We also had forward plungers in TY and US. Remember also that a failed plunger (failed plunger not an expired plunger) creates an opposing signal as well. I will be watching Crude, heating oil and unleaded gas very closely to see if these plungers fail. If they do fail that will create another sell.

For now, regardless of what happens with the recent forward plungers, I still believe the highs for the year may be in place in CL, HO, and HU. I am not sure about NG however. I am keeping an eye on NG as its still above its 18dma. However, notice NG did move sharply lower off its high following the recent RP which occurred in conjunction with the outside day down (the double-whammy). We also had an extremely OB condition on our daily detrended study for NG and all of this occurred while the market was under an IMPA sell selection! The detrended study for NG did an excellent job picking off the recent bottom and the current high (top) via the statistical over-bought and over-sold area's on this graph. And when you combine this unique measurement with everything else, well, the result can be extremely impressive!

When a market reaches the OB or OS area's on our detrended graphs the probabilities begin to come into play as they favor a regression back towards the detrended center point mean. Lets look at the detrended OB/OS proprietary daily oscillator for NG below.

Keep in mind we also have these studies (graphs) derived from our weekly price graphs too (derived from the weekly data). Thus we have both weekly detrended oscillators and daily detrended oscillators. The one above is associated with the daily data and thus directly under the daily trend/swing graph. These are used for both swing trading and IMPA position trading.

Stock indices, S&P500 and Russell - This market continued higher following the recent forward plunger formations (couple weeks ago) and in conjunction with today's failed RP (we closed above yesterday's high in the RL, ES, DJ and SP) which resulted in yesterday's RP's failing today.

Overall I remain bullish via the potential for a Q4 rally as we have discussed. This appears to be off to a good start thus far. However, let me make something very clear - Friday's EMPLOYMENT DATA will be very important! Furthermore the close on Friday will also be very important for this market as we head deeper into November. Again both September and October were relatively mild months (traditionally these two months have seen some of the largest monthly declines in equities).

Tomorrows market: The election is behind us now and the market gave us a signal of approval today. In addition today's closes above yesterday's highs caused another buy signal to be generated. Looking ahead to Friday we have the employment data for October of course. Overall I remain bullish.

Coffee (KC) - There is a chance in here that this market may try to move higher again. The market is back above the 18dma now and we are coming off a recent IMPA buy selection.

Swing Trades (For Advanced Traders)
- Swing Approach "A" - The standard trend approach. My favorite.
- Swing Approach "B" - The standard counter-trend approach.

Gold (GC) - Gold prices moved under the 18dma yesterday (1st day under the 18dma) but did not stay there today. We moved back above the 18dma today. Thus yesterday was only 1 day under the 18dma. We need two closes under the 18dma to change the color to red on our daily trend/swing price graph. The color in fact will stay green until we get 2 consecutive closes on either side of the 18dma (above it or under it). A potential battle is being fought here (at the 18dma) and the data seems to be indicating the gold market will go lower in here not higher (provided there are no surprises). Overall I still remain bearish for now.

ALL Stops:
ALL STOPS on all positions are now STOP-CLOSE-ONLY and have been since I officially updated our procedures in 2001 and 2002. I discuss this in detail in the June 2003 workshop video which I highly recommend to all serious traders using these strategies. To order the DVD version on special for a few more days click here. The new stop-close-only stop method is far superior than our original "resting stop" method. It makes a big difference!

Stop close only manual order. You do not have to place the order as "Stop close only" in order to use the closing price for your stop. What I recommend is that you simply wait until the close to evaluate your stop. If y our stop is exceeded on the close (based on the official closing price as reports on our graphs) then we simply exit on the open of the next day session (within the first 15 min of trade)! We have always managed our positions (stops) this way in options and spreads because they trade to thinly for intra-day resting stop orders. Now all positions should be managed this way. Again, if stopped out, you want to be out the next morning (next day-session) and within the first 15 minutes.

I remain bullish some stocks for now. These are QQQ, QCOM and LTD (the Limited is based in Ohio).

Be sure to visit the discussion board daily! I am there daily answering questions and assisting members (with position trades and day trades). My presence on the message board overlaps my reporting here this even if you cannot visit the board during the day, you can visit in the evening! You don't have to post a thing as well. You can simply review all the posts that took place during the day (something I recommend). Some days are more active that others of course. I recommend checking in with the board daily!

Our new Stock Market Research Site address is:
This is new and under development
www.equitiesresearch.org

Position Management and Money Management Portion of the System - Remember never to risk more than 10% of your risk capital on any one single trade. We must never adjust the stop to accommodate the 10% risk. The stop needs to be placed strategically based on the market, and the market alone, not what you can afford to lose. I can't stress the importance of this enough. Once the stop point is determined, the risk can be calculated. If the risk is to large, pass on the trade and wait for a lower risk trade.

Our two important Rules: Control risks & manage profits!
Click here for Risk Matrix Click here for 50% rule.

Special backup site - The backup site provides a second source for our charts and graphs as a back up when/if something goes wrong with the main site or main computer driving the data to the main site. The address to the backup site is http://www.cotdata.com. Your discussion board username and password combination is required for access - If you do not have discussion board access, email Floyd for a special username / password combination for the backup site.

* The hotpage does not trade all the setups, only certain ones are taken and they are all for teaching purposes, so I can demonstrate to you (live) how to trade using our system, methods, rules and data. My goal is to teach you how to trade using our strategies, not to trade for you.

"Shun passion, fold the hands of thrift. Sit still, and Truth is near: Suddenly it will uplift your eyelids to the sphere: Wait a little, you shall see the portraiture of things to be."
Ralph Waldo Emerson

"When it comes to success in trading, being right most of the time is not nearly as important as is being procedurally right all of the time! "
Floyd W. Upperman Jr. CTA