/LB (lumber futures) was a recent long-side trade idea on the breakout above 440 as well as the daily bullish falling wedge pattern & I posted exiting the trade for a 19% profit in the Jan 31st video as a break of the uptrend line followed by a pullback seemed likely. That exit proved to be very timely & /LB now offers an new objective long entry, re-entry, or cover & reverse from short-to-long here at the pullback to the 440 former support, now resistance level the last long trade was entered at.
LB 60m Feb 9th
As lumber is doing what it does, typically moving full-throttle up or down (and still clearly in a powerful downtrend/correction mode), as a counter-trend & therefore aggressive trade, one could take a starter/partial position here with the next objective entry or add-on to come on either a solid break above the downtrend line and/or a pullback to the next support level at 410, with stops somewhat below.
Due to the volatile nature & above-average gain/loss potential on lumber, the suggested beta-adjusted position size is 0.5-0.7. Price targets TBD as I’m leaning towards only gaming a potential quick bounce at this time although open to the potential to let the trade run (if not stopped out) but that will largely depend on whether or not the major stock indices start to break some of the key support levels just below in the coming days or weeks. Targets will follow soon if /LB reverses & starts to rally off any of the aforementioned support levels and/or takes out the downtrend line.