We've asked Michael Seery of SEERYFUTURES.COM to give our INO readers a weekly recap of the Futures market. He has been Senior Analyst for close to 15 years and has extensive knowledge of all of the commodity and option markets.
Michael frequently appears on multiple business networks including Bloomberg news, Fox Business, CNBC Worldwide, CNN Business, and Bloomberg TV. He is also a guest on First Business, which is a national and internationally syndicated business show.
Gold Futures
Gold futures in the April contract settled last Friday at 1,227 while currently at 1,207 down about $20 for the trading week still trading below their 20 & 100 moving average telling you that the trend is to the downside as prices have hit a 6 week low. I am currently sitting on the sidelines awaiting better chart structure to develop as investors continue to put money into the equity market as gold seems to be entering into a bearish trend once again in my opinion. The next level of major support is around the 1,180 level and if that level is broken I would have think that a retest of the contract low which was hit in early November 2014 could be in the cards so keep a close eye on this trade because a trade could be coming if chart structure improves and that could happen next week. Problems around the world seem to be out of the lime light at the current time as I don’t see any real reason to own gold as I remain bullish the S&P 500 as the U.S dollar continues to hover around 11 year highs as I think the dollar is in a secular bull market for some time to come as Europe’s economy is not as strong as the United States as that’s also a negative fundamental influence on gold prices.
TREND: LOWER
CHART STRUCTURE: POOR
Silver Futures
Silver futures are trading below their 20 & 100 day moving average continuing its bearish trend hitting a 6 week low as I am currently sitting on the sidelines waiting for better chart structure to develop. Silver prices settled last Friday around 17.30 while currently trading at 16.35 down about 95 cents for the trading week as the trend still remains choppy in my opinion. Silver prices topped out around the 18.50 level last month as we might be on the sidelines for some time as I would like to see lower volatility as well as a possible retest of 15.50 could be underway and if you are bearish silver prices my recommendation would be to sell at today’s price while placing your stop loss at the 10 day high of 17.40 risking around $1,100 per mini contract plus slippage and commission however I am watching this market at the current time.
TREND: CHOPPY
CHART STRUCTURE: OK
Crude Oil Futures
Crude oil futures are trading above their 20 but still below their 100 day moving average telling you that the trend is mixed as I have been advising clients to sit on the sidelines until volatility slows down which could take some time. Crude oil futures settled last Friday at 53.67 a barrel while currently trading around 51.20 in the April contract down around $2.50 for the trading week. The chart structure is starting to improve as prices have been trading between 50-55 in the last 2 weeks looking to breakout soon so keep a close eye on this market as a breakout above $55 could be in the cards but be patient as the trend is still choppy with no short term trend which does not meet my criteria to enter. The API report came out yesterday stating that we had 14 million barrels in storage versus the 3 million estimate sending prices down over $2 as the fundamentals still remain bearish as currently there is still an oversupply issue in the short term.
TREND: MIXED
CHART STRUCTURE: OK
Soybean Futures
Soybean futures in the May contract settled last Friday around 9.95 a bushel while trading currently at 10.03 down about 9 cents but still finished higher by 7 cents for the trading week. Soybean prices are trading above their 20 day but barely below their 100 day moving average as I was stopped out of the short positron last Friday when prices hit a 2 week high remaining neutral. Yesterday prices traded above 10.20 on reports of lower planted acres as volatility should increase as we start to enter springtime as I am neutral currently waiting for another trend to develop as I think prices will continue to chop around for the next 6-8 weeks so look at other trades that are trending. If you are bullish the soybeans I would buy at today’s price level while placing the stop loss at the 10 day low around 9.71 risking around 32 cents or $1,600 risk per contract plus slippage and commission while risking 2% of your account balance on any given trade.
TREND: HIGHER
CHART STRUCTURE: IMPROVING
Orange Juice Futures
Orange juice prices settled at 136.75 last Friday in the May contract while currently trading at 131.45 down over 500 points for the trading week as I have been recommending a short position in this market for several weeks and if you took that trade place your stop above the 10 day high at 140.05 risking around 900 points or 1,350 per contract plus commission and slippage. Orange juice prices are trading below their 20 and 100 day moving average as the chart structure will start to improve next week as the weather conditions in Florida should produce a solid crop as frost concerns are waning at the current time putting pressure on prices. The next level of support is the contract low which was hit in early November around 128 as this market remains bearish so continue to play this to the downside.
TREND: LOWER
CHART STRUCTURE: IMPROVING
Oat Futures
Oat futures in the May contract finished down $.05 this week in Chicago closing around 2.73 a bushel as I’ve been recommending a short position as prices are trading below their 20 and 100 day moving average and if you look at the longer-term downtrend line it’s still intact, however many of the grains have been mixed going sideways in recent weeks as we head into the volatile spring and summer months but as a trend follower I have to stick to the rules as this market has not hit a 10 day high at the current time so remain short. If you didn’t take the original recommendation the stop loss is at 2.96 a bushel risking around $.13 or $650 per contract plus slippage and commission as the next level of major resistance is Thursday’s low around 2.68 and if that level is broken I can see a possible breakdown to the $2.50 a bushel level in the short term.
TREND: LOWER
CHART STRUCTURE: IMPROVING
Nasdaq 100 Futures
The Nasdaq 100 is trading far above their 20 & 100 day moving average as the trend is getting stronger to the upside as I have been recommending a bullish position and if you took that trade place your stop below the 10 day low at 4200 risking around 200 points or $4,000 per contract plus slippage and commission as the chart structure will start to improve next week. The Nasdaq has traded higher for 7 consecutive trading sessions as Apple computer continues to hit all-time highs carrying the Nasdaq higher as I think all-time highs will be retested which is still over 400 points away as the technology sector is on fire once again. Nasdaq futures settled last Friday around 4317 rallying about 50 points during this holiday shortened week however if you have missed this trade wait for some type of price pullback before entering as you have missed the boat as the risk is presently to high. In my opinion this market has turned into a demand story due to fewer outstanding shares floating because of massive company stock buy backs as investors see nowhere else to park money so they are buying stocks once again as I think this trend will continue to move higher throughout 2015.
TREND: HIGHER
CHART STRUCTURE: IMPROVING
Japanese Yen Futures
The Japanese Yen in the March contract settled at 8420 last Friday while currently trading around 8437 as I’ve been recommending a short position when prices broke the 8400 level as this trade has gone sideways for the last week and if you took the trade place your stop above the 10 day high at 8538 risking 100 points or 1,250 per contract plus slippage and commission as the chart structure remains outstanding. The next level of support is around 8300 and if that level is broken I would think a possible re test of the contract low around 8200 will be tested in the coming weeks however if you are stopped out move on and look at other trends that are starting to develop. The main reason that the Yen has fallen in recent years is because of the massive quantitative easing that is currently underway pushing the Yen to levels we have not seen in years as the U.S has now finished their bond buying program pushing the U.S dollar to 11 year highs as the fundamentals are still in place in my opinion.
TREND: HIGHER
CHART STRUCTURE: EXCELLENT
Live Cattle Futures
Live cattle futures in the April contract continue to experience extreme volatility currently down 245 points this Friday afternoon in Chicago trading at 153.90 as traders await this afternoons cattle on feed report after settling around 153.22 last Friday down about 430 points for the week looking to test recent lows once again. Cattle futures are trading below their 20 & 100 day moving average as I’m recommending speculators to avoid this market as extreme volatility and terrible chart structure have dominated this market since prices broke from 166 down to 147 in 3 weeks as we are now consolidating, however if you are a cattle producer I strongly advise you to take advantage of any rallies and start to hedge as I don’t think prices will stay up at these levels for much longer. Cattle prices historically speaking are still extremely high so don’t be greedy & start hedging a certain percentage of the portfolio as nobody knows where prices can actually go just ask any crude oil producer who didn’t hedge as they are in a world of hurt at the current time. The fundamentals in cattle are still relatively strong as expansion of herds probably will not take place for another 6 months so prices could still remain relatively high.
TREND: MIXED
CHART STRUCTURE: POOR
If you are looking for a futures broker feel free to contact Michael Seery at 800-615-7649 and he will be more than happy to help you with your trading or visit www.seeryfutures.com
Sugar Futures
Sugar prices are trading below their 20 & 100 day moving average telling you that the short term trend is to the downside as I will be recommending a new short position if prices close below 14.37 while then placing your stop above the 10 day high which was Wednesdays high of 15.19 risking around 80 points or $900 per contract plus slippage and commission. Sugar prices have been trading in a tight short term channel looking to break out soon so keep a close eye on this trade as weather in Brazil has been ideal for growing conditions as worldwide supplies are still large while the Brazilian Real remains very weak against the U.S dollar also contributing to the recent weakness as I think the chart structure is outstanding as this trade meets all criteria if 14.37 is broken. Remember as a commodity trader you must follow the trend as the path of least resistance is the correct way to trade in my opinion especially over the long haul.
TREND: LOWER
CHART STRUCTURE: EXCELLENT
Cotton Futures
Cotton prices are trading above their 20 & 100 day moving averages settling last Friday in New York around 63.32 while currently trading around 64.40 continuing its bullish trend however I am currently sitting on the sidelines despite the fact that prices are at 5 month highs as fundamental news yesterday stated that cotton acreage this year will be 12% less than in 2014 around 9.7 million acres which would be the lowest since 2009. I was recommending a short position several weeks ago getting stopped out at the 10 day high which at the time was 60.30 as prices have rallied another 400 points and that’s why I stress an exit strategy because money management is the most important tool in successful trading in my opinion. Acreage estimates can still change in the next several months depending where the prices of corn, soybeans and cotton will be come spring time as volatility will increase as we head into the critical growing season.
TREND: HIGHER
CHART STRUCTURE: POOR
Coffee Futures
Coffee futures in the May contract settled last Friday around 166.50 a pound while currently trading at 153.50 as I was recommending a short position below 160 and if you took that trade place your stop above the 10 day at 172.50 risking around 1900 points or $7,200 risk per contract plus slippage and commission as the chart structure is terrible due to the fact that prices have dropped 4 out of the last 5 trading sessions. Ideal weather conditions in Brazil are to blame for the declining prices as a drought is highly unlikely this year as I see prices possibly testing the 130-140 level in the next several weeks as the trend is getting stronger to the downside on a weekly basis. Coffee prices are trading below their 20 & 100 day moving average telling you that the trend is lower however if you missed this trade wait for some type of rally as the risk is too high at the current time.
TREND: LOWER
CHART STRUCTURE: POOR
Should You Add To Your Losing Trades?
This rule is extremely important and I witness it being abused constantly creating tremendous loses that are sometimes difficult to come back from. Never add to a losing position because if the position continues to go against you and now you have added even more contracts which are all losing money your account will suffer loses much more than 2% and in some case adding positions and never getting out of a losing trade has wiped peoples trading accounts down to zero because of 1 or 2 bad trades. Remember always play for another day you will have losing trades and the good traders manage losses and move on to the next possible trade.
If you are looking for a futures broker feel free to contact Michael Seery at 800-615-7649 and he will be more than happy to help you with your trading or visit www.seeryfutures.com
SEERY FUTURES ACCEPTS CANADIAN COMMODITY ACCOUNTS
There is a substantial risk of loss in futures, futures option and forex trading. Furthermore, Seery Futures is not responsible for the accuracy of the information contained on linked sites. Trading futures and options is Not appropriate for every investor. My opinion in this blog are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any futures or option contracts.
Michael Seery, President
Seery Futures
http://ift.tt/1fGCqDc
Twitter–@seeryfutures
Phone #: (800) 615-7649
mseery@seeryfutures.com
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