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 are currently trading at 1,212 up around $3 an ounce while settling last Friday at 1,205 finishing up $7 in a relatively quiet trading week. Gold futures are trading below their 20 and 100 day moving average as I’ve talked about in many previous blogs I do think gold is now being used as a currency due to the fact that the Euro currency and many foreign currencies are absolutely falling out of bed as interest rates in many countries have gone negative so who wants to place money into a bank and lose money as investors are looking at gold which has no dividend but still it’s better than a negative return. Volatility in many of the commodity markets is very high at the current time especially the precious metals and I expect that to continue despite the fact that the U.S dollar hit an 11 year high continuing its secular bull market in my opinion as I do think 100 is on its way in the next several months as the United States economy is doing much better than any economy worldwide. Gold futures have rallied from a contract low of 1,130 all the way up to about 1,310 in the last several months as I’m sitting on the sidelines waiting for better chart structure to develop as money is moving back into the S&P 500 sending prices to all-time highs as I don’t see any reason to own gold despite all of the worldwide problems.
TREND: LOWER
CHART STRUCTURE: SOLID
Silver Futures
Silver futures in the May contract are up $.5 this Friday afternoon in New York currently trading at 16.66 an ounce settling last Friday at 16.32 finishing up about 40 cents for the trading week with extreme volatility so make sure that you use the proper amount of contracts risking only 2% of your account balance as I like to trade the mini contract which is $10 a cent versus $50 a cent on the large contract as high volatility has also entered the S&P 500 and the currency markets in recent weeks. As I talked about in previous blogs I believe silver is now being used as a currency due to the fact that interest rates around the world are so low that investors are looking at silver as a currency replacing traditional paper currencies as nobody wants to own anything in Europe. Many of the commodity markets continue to head lower however silver remains choppy at the current time as I am still recommending investors to sit on the sidelines and wait for a trend to develop.
TREND: MIXED
CHART STRUCTURE: SOLID
Cotton Futures
Cotton futures in the May contract are down 140 points this Friday afternoon in New York currently trading at 63.90 after settling last Friday at 64.66 up around 70 points on strong exports as I’ve been sitting on the sidelines despite the fact that prices are near 6 month highs. Cotton prices are trading above their 20 & 100 day moving average telling you that the trend is higher however the chart structure is poor currently as that’s the reason I am currently neutral as poor economies around the world are continuing to pressure many commodities. If you have been reading any of my previous blogs I am bearish most of commodity markets as I do think worldwide deflation is going to be a problem as China still has huge supplies of cotton but planting expectations are around 9.7 million acres which is a 12% decline from 2014 which has pushed up prices in the last several weeks but demand in my opinion will start to weaken in the next couple of months so sit on the sidelines and wait for a better chart pattern to develop.
TREND: HIGHER
CHART STRUCTURE: POOR
Soybean Futures
Soybean futures in the May contract are up $.7 in Chicago this afternoon currently trading at 10.34 a bushel hitting a 6 week high trading above its 20 and 100 day moving average settling last Friday around 10.02 finishing higher by around 32 cents continuing its bullish trend as we head into the growing season. The weather in Brazil and the rest of South America has been excellent as harvest is around 25% completed producing another record crop however there is a strike currently in Brazil which has supported prices in the short term as export estimates came out this week & were very good however I am on the sidelines waiting for better chart structure to occur as I might not get involved in this market until April or May. The U.S dollar is hitting an 11 year high having very little impact on prices in the short term as estimates of next year’s acres are all over the board between 84-88 million acres as that will be confirmed next month giving us a better picture of the possible crop size in 2015 as carryover levels are still near historical highs but at the current time there is very little fundamental news as I think prices will continue to remain choppy for the next 4-6 weeks.
TREND: HIGHER
CHART STRUCTURE: POOR
Corn Futures
Corn futures in the May contract are up 5 cents this afternoon after settling last Friday in Chicago at 3.93 a bushel currently trading at 3.93 unchanged for the trading week while trading at its 20 and 100 day moving average telling you that the trend is mixed as I’m recommending investors to sit on the sidelines and wait for a trend to develop The commodity markets in general still look very weak in my opinion as the U.S dollar is hitting an 11 year high once again as that’s also a negative influence on grain prices as harvest is underway in South America as traders are keeping an eye on the next USDA crop report which comes out in 2 weeks as estimates for planting is around 88 million acres which is a reduction of 3 million acres from 2014. The corn market in my opinion fundamentally speaking is not as bearish as the soybeans as less acres and expanding herds will create more demand for corn, however if we produce between 13.5 – 14 billion bushels in 2015 I think prices could head much lower so I’m still recommending farmers to have a hedging strategy in place as deflation has been a real concern worldwide.
TREND: MIXED
CHART STRUCTURE: SOLID
Wheat Futures
Wheat futures in the May contract are up $.09 this Friday afternoon trading around $5.09 a bushel after settling last Friday at 5.07 around unchanged for the trading week still trading below their 20 and 100 day moving average as I’m recommending a short position in wheat while placing your stop loss above the 10 day high which currently stands at 5.43 a bushel risking around $.33 or $1,650 per contract plus slippage and commission. The next level of support is the contract low of around 4.90 which was yesterday’s low as growing conditions are excellent throughout much of the Great Plains as ample supplies should come during harvest sending prices even lower as the trend is your friend in the commodity markets and the trend in this market is clearly to the downside as prices have fallen quickly as concerns about Russia cutting exports has waned as there is very little bullish fundamental news to support prices except for the fact at the current time prices are oversold.
TREND: LOWER
CHART STRUCTURE: IMPROVING
Oat Futures
Oat futures in the May contract are up 4 cents this Friday afternoon in Chicago still trading below their 20 and 100 day moving average settling last Friday at $2.73 finishing the week up about $.5 at 2.78 as I have been recommending a bearish position when prices broke $3 a bushel and if you took that original trade place your stop loss above the 10 day high which currently stands at $2.79 still risking about $.1 or $50 per contract plus slippage and commission as this trade seems to be coming to an end. Oat futures did hit a fresh 2 ½ year low on Wednesday before rallying sharply in the last 2 trading sessions as the reason I was recommending this trade if you remember was due to the fact that the original risk was only about $400 which meets criteria in my opinion as prices have suddenly stalled. I am disappointed in this trade as I thought prices would continue to slide but if you are stopped out move on and look at another market that is beginning to trend.
TREND: LOWER
CHART STRUCTURE: SOLID
Orange Juice Futures
Orange juice futures in the May contract settled at 130.65 while currently trading at 122.40 down about 800 points for the trading week as I’ve been recommending a short position from around the 137 level as prices continue to sell off as ideal weather conditions are pressuring prices. Orange juice prices are still trading below their 20 and 100 day moving average hitting a yearly low in yesterday’s trade selling off sharply in the prior 4 trading sessions as the frost possibility in the state of Florida are starting to fade as the commodity markets in general still remain pessimistic, despite the fact that crude oil prices may have formed a possible bottom in the short term. As a commodity trader I am a trend follower and the trend in orange juice is to the downside but make sure you place your stop loss above 138 risking around 1600 points or $2,400 per contract from today’s price levels plus slippage and commission as the chart structure will not improve until late next week.
TREND: LOWER
CHART STRUCTURE: POOR
Japanese Yen Futures
The Japanese Yen in the March contract are trading below its 20 & 100 day moving average telling you that the trend is to the downside currently trading at 8377 as I’ve been recommending selling the Japanese Yen when prices broke the 8400 level and if you took that trade place your stop loss above the 10 day high which currently stands at 8470 risking about 100 points or $1,250 per contract plus slippage and commission as the Japanese Yen is a very large contract with big price swings and high risk. The next major level of support is around 8300 which was the low on February 11th and if prices can break that level I think you could retest the contract low of around 82.00 as quantitative easing in Japan continues to pressure the Yen in recent years as no country around the world wants a strong currency while at the current time the U.S dollar is the king trading near 11 year highs. The reason I took this trade was the fact that the trade met criteria as the risk/reward was in my favor in my opinion and the chart structure was outstanding at the current time of the breakout while risking 2% or less of your account balance on any given trade as a proper risk management technique.
TREND: LOWER
CHART STRUCTURE: OUTSTANDING
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 currently trading at 13.72 finishing down over 50 points for the trading week as I have been recommending a short position when prices closed below 14.37 while then placing your stop above the 10 day high at 15.19 risking around 150 points or $1,700 per contract plus slippage and commission. Sugar prices have hit another multiyear low 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 the chart structure will start to improve next week. 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: POOR
Coffee Futures
Coffee futures in the May contract are currently trading at 141 a pound hitting another round of contract lows this week as I have been recommending a short position while placing your stop loss above the 10 day high which stands at 169 as the chart structure is terrible because of the fact that prices have dropped for 9 consecutive trading sessions as the weather in Brazil is not as much of a concern as ideal conditions are still persisting in many key coffee growing regions. Coffee futures are trading below their 20 and 100 day moving average settling last Friday at 152.90 down over 1000 points for the trading week as many the commodity markets continue to move lower as the U.S dollar is hitting an 11 year high once again as it doesn’t look like a back-to-back drought situation will occur in Brazil this year. The chart structure will start to improve later next week as the risk currently is 2800 points or $10,500 per contract plus slippage and commission as coffee is a very large contract controlling 37,500 pounds in one contract as the trend still remains bearish but if you missed this trade sit on the sidelines because the risk is too high as you have missed the boat.
TREND: LOWER
CHART STRUCTURE: AWFUL
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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