Weekly Futures Recap With Mike Seery

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 settled last Friday in New York at 1,334 an ounce while currently trading at 1,334 unchanged for the trading week as the volatility certainly has increased as gold prices have rallied about $100 from their December 12th low of 1,238 as this remains in a bullish trend. I do not have any recommendations in the precious metals, but if you are long a futures contract, I would place the stop loss under the two-week low at 1,308 as the chart structure will also improve in next week's trade. The main reason for the recent rally is the fact that the U.S. dollar has hit a three year low which is definitely a fundamental bullish indicator towards gold and the precious metals as a whole. The next major level of resistance is the September 8th high of 1,365. I think prices will try to touch that level in the coming weeks ahead as it looks to me that the dollar will continue its bearish trend, therefore, supporting gold despite the fact that the U.S. stock market seems to hit an all-time high every day which used to be negative towards gold. But 2018 is a different story as the commodity markets will start to catch up to the high stock prices in my opinion as the U.S economy is growing for the 1st time in nearly ten years. Gold futures are trading above their 20 and 100-day moving average as clearly the trend is higher, but I will look at other markets with a better risk/reward scenario at present.
TREND: HIGHER
CHART STRUCTURE: IMPROVING
VOLATILITY: INCREASING

Silver Futures

Silver futures in the March contract is currently trading at 17.04 an ounce after settling last Friday in New York at 17.14 down slightly for the trading week. I'm looking at a possible bullish position if prices break out above the 17.50 level as prices have been stuck in a three-week consolidation with excellent chart structure. Silver prices are trading above their 20 and 100-day moving average following gold & the rest of the precious metal sector higher. I still think silver prices, historically speaking, look cheap and if the U.S. dollar continues its bearish momentum silver prices could head up into the low 20s in the coming months ahead. The U.S. dollar has hit a three year low as that momentum is getting stronger on a weekly basis as the commodity markets in general, are starting to rally. As I've talked about in many previous posts, I thought 2018 would be bullish across the board, and that is exactly what is starting to develop except for a couple of sectors in the agricultural markets. But I think they will join the party as well so look to play this to the upside as I still think there's a lot of room to run as the volatility certainly should increase in the weeks ahead as historically speaking silver is one of the most volatile commodities, but has come to a crawl over the last year or so.
TREND: HIGHER
CHART STRUCTURE: IMPROVING
VOLATILITY: LOW

Natural Gas Futures

Natural gas futures in the March contract settled last Friday in New York at 3.20 while currently trading at 3.19
are sideways for the week with high volatility that is expected in January and February. I have been recommending a bullish position from the 2.78 level, and if you took that trade, the stop loss now has been raised to 2.78 and will be tightened on a daily basis next week, therefore, lowering the monetary risk. Natural gas prices are trading at an eight-week high still above their 20 and 100-day moving average as the trend is clearly to the upside as weather forecasts are dictating the short-term price action here in the short term. The next major resistance in natural gas is between 3.30/3.40 & if that is broken, then the bullish trend could get stronger to the upside as we are looking ahead to the 7/10 day weather forecast which has pretty much normal temperatures at this time, but that can change as it is a very long winter season. At present, I am bullish the entire energy sector as they are slightly lower across the board today as high demand & improving economies especially in the United States is propping up prices. I think that bullish momentum will continue throughout 2018 as traders are awaiting next week's natural gas report which hopefully shows a drawdown in inventories as that can also be the main catapult to higher prices so stay long as the bullish momentum remains.
TREND: HIGHER
CHART STRUCTURE: IMPROVING
VOLATILITY: HIGH

10-Year Note Futures

The 10-year note settled last Friday in Chicago at 122/30 while currently trading at 122/10 down about 20 points for the trading week and continuing its bearish momentum as the 10-year note is now yielding around 2.64% right near a five year low, continuing its slow grinding bearish manner. I have been recommending two short positions with an average price around 123/18 and if you took that trade continue to place the stop loss above the two-week high standing at 123/13 as the chart structure will improve tremendously next week, therefore, lowering the monetary risk. I still think prices could drop rather precipitously in the coming weeks ahead as all of the interest continues to be in the U.S. stock market as prices are right near an all-time high once again. The next major level of support if you take a look at the monthly charts is all the way down to the 120 level which is still quite a distance away. I will be looking at adding more contracts once the chart structure tightens up as adding to winners and getting out of the losers is the way to trade over the course of time as this trend is getting stronger on a weekly basis. If you have read any of my previous posts you understand that I think we can trade as high as 3.50% come year-end as there is no reason to have these extremely low-interest rates with a possible GDP growth rate of 4% in the coming months ahead due to the tax cuts, so stay short and look to add on any type of price rally.
TREND: LOWER
CHART STRUCTURE: IMPROVING
VOLATILITY: LOW

If you are looking for a futures broker feel free to contact Michael Seery at 312-224-8140 and he will be more than happy to help you with your trading or visit www.seeryfutures.com

What do I mean when I talk about chart structure and why do I think it’s so important when deciding to enter or exit a trade? I define chart structure as a slow grinding up or down trend with low volatility and no chart gaps. Many of the great trends that develop have very good chart structure with many low percentage daily moves over a course of at least 4 weeks thus allowing you to enter a market allowing you to place a stop loss relatively close due to small moves thus reducing risk. Charts that have violent up and down swings are not considered to have solid chart structure as I like to place my stops at 10-day highs or 10-day lows and if the charts have a tight pattern that will allow the trader to minimize risk which is what trading is all about and if the chart has big swings your stop will be further away allowing the possibility of larger monetary loss.

Corn Futures

Corn futures in the March contract settled last Friday in Chicago at 3.46 a bushel while currently trading at 3.52 reversing the losses that we witnessed last Friday off of the USDA crop report which was construed bearish, but I think all of the bad news has already been reflected into this market. I am looking for a possible bullish position if prices break on a closing basis the 3.55 level & if that does occur, place the stop loss under the two-week low standing at 3.45 risking around $0.10 or $500 per contract plus slippage & commission. The volatility is extremely low. Therefore, the chart structure is outstanding. Corn prices are trading above their 20-day moving average, but slightly below their 100-day which also stands at major resistance at 3.58 as the grain market especially soybeans and soybean meal have come to life over the last week as I think that will help support corn in the months ahead. Traders are keeping a close eye on planting intentions for 2018 as we will now focus on the U.S. crop which will undoubtedly send volatility back into this market as spring planting is just a couple months away so look to play this to the upside as the downside is very limited in my opinion. The U.S dollar is hitting a three year low in today's trade. I sound like a broken record, but this will start to support grain prices just like its now supporting the precious metals and the energy market over the last month as the bullish trends are coming.
TREND: MIXED
CHART STRUCTURE: OUTSTANDING
VOLATILITY: LOW

Cotton Futures

Cotton futures in the March contract is currently trading at 83.06 after settling last Friday in New York at 81.68 up about 140 points for the trading week and continuing to be the strongest agricultural commodity out of the entire sector continuing its bullish momentum, and I still see higher prices ahead. I have been recommending a bullish position over the last couple months from the 70.50 level and if you took that trade, the stop loss has been raised once again up to 77.93 as the chart structure will also improve in next week's trade, therefore, lowering the monetary risk as the gravy train continues. Cotton prices are trading far above their 20 and 100-day moving average as this trend has been incredibly strong over the last several months and I still think there's a possibility we could trade as high as 90 in the coming weeks ahead. The hurricanes that happened in 2017 coupled with the West Texas freeze did some serious damage to the U.S. crop as that is what is propelling prices higher here in short-term. The U.S. dollar has hit a three year low this week as that is helping support prices coupled with the fact of strong worldwide demand as I don't think that's going to let up anytime soon so continue to place the proper stop loss as who knows how high prices could trade.
TREND: HIGHER
CHART STRUCTURE: IMPROVING
VOLATILITY: LOW

Coffee Futures

Coffee futures in the March contract are currently trading at 121.00 a pound lower by 125 points for the trading week as this market remains on the defensive testing major support between the 118/120 level. Prices are trading under their 20 and 100-day moving average as the trend is still negative. However, I am still looking for a possible bullish position in the weeks ahead. I think the downside is very limited as I now have recommendations in cotton and in the cocoa market as the commodities hit a three year low today, but has had no influence on coffee prices over the last several months. I eventually think it will push prices higher as ideal weather conditions in Brazil are the major problem at the current time and that's keeping a lid on prices. The chart structure has started to improve on a daily basis which is very important when trading coffee as this commodity is extremely risky with high volatility, however at the current time we have extremely low volatility, but I don't see that lasting much longer as the winter months can become very volatile just like what happened in 2014 sending prices sharply higher due to the drought in Brazil, so keep a close eye on this market as we could be involved soon.
TREND: LOWER
CHART STRUCTURE: IMPROVING
VOLATILITY: LOW

Oats Futures

Mr. Ed the famous horse is very happy as I have been recommending a bullish position in oats at the 2.60 level. If you took this trade, continue to place the stop loss under the two-week low standing at 2.45 as the risk is around $0.15 or $750 per contract plus slippage and commission. Prices have now hit a five-week high. The oats are trading higher for the 3rd consecutive session now trading above their 20 and 100-day moving average as this trend has turned to the upside. You have to remember that the oat contract can become extremely volatile and volatility remains relatively low despite the fact that we had a 6 cent up day in today's session so stay long & place the proper stop loss while risking 2% of your account balance on any given trade. The next major level of resistance is around the 2.70 level, and if that is broken, I think we could test the November 15th high around 2.88 as there is room to run to the upside in my opinion. I'm also looking for a bullish position in corn which was slightly lower in today's session as I do think the commodity markets are headed higher.
TREND: HIGHER
CHART STRUCTURE: IMPROVING
VOLATILITY: LOW

Trading Theory

Trade with the short-term trend, as the saying goes in futures trading the trend is your friend, but sometimes you will be in a market that is trending higher and then has a false breakout to the upside and then suddenly sells off causing you a 2% loss on your equity and you say to yourself that was a bad trade and should I do something different on my next trade.

If it were up to me, I would continue to buy strength and sell weakness because in the long run commodity trading is about percentages of success in the long run, and if you go with the path of least resistance more often than not you will have the probabilities of success on your side.

I define a trend as a commodity hitting a 20 day high or low as a trendy market if the market is in a consolidation stay away from it and find something that is trending up or down and goes in that direction remembering the money management rules of 2% maximum loss if you are wrong.

If you are looking for a futures broker feel free to contact Michael Seery at 312-224-8140 and he will be more than happy to help you with your trading or visit www.seeryfutures.com

Michael Seery, President
Seery Futures
Facebook.com/seeryfutures
Twitter–@seeryfutures
Phone #: 312-224-8140
[email protected]

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.