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 this week saw extremely volatile trade finishing out this Friday afternoon up $14 at 1, 387 an ounce and traded as low as 1,358 this morning before the U.S unemployment report came out showing we added 169,000 new jobs which was disappointing to traders thinking that the Federal Reserve will not taper pushing many commodities higher this afternoon. Tensions in Syria as well are starting to flare-up as it looks like Pres. Obama is determine have some type of strike against Syria which also lent support to prices this afternoon as gold is kind of stuck in a range between 1,430 & 1,350 looking for some new fundamental news to dictate short-term prices.I’m still advising traders to be long the gold market with either some type of bull call spread limiting your risk to what the premium costs or if you’re a futures trader possibly be long the mini contract or big contract depending on account size as I do think worldwide problems are here to stay and there might be a real need to own gold once again. The chart structure in gold is very good; however this is a high risk trade as you’re having $30 to $50 swings on the daily basis so you must respect money when you’re trading this market because of the high risk at the present time. TREND: HIGHER –CHART STRUCTURE: EXCELLENT –RISK--HIGH
Cotton Futures-- Cotton futures rallied sharply this afternoon in New York climbing 90 points to settle around 83.20 reversing its bearish trend as yesterday’s price hit 12 week lows on concerns of oversupply & solid crops here in the United States and worldwide. The U.S dollar has been stronger in recent weeks, however today it was down 50 points which helped support many of the commodity markets including cotton, but it’s still trading below its 20 and 100 day moving average as traders await next week’s USDA report which should dictate where short-term prices are going showing the latest carryover and production levels. Last Friday cotton settled at 83.49 basically going out this week unchanged & I have been recommending a short position with either a futures contract or some type of bearish option spread as I think prices could break the 80.00 mark possibly next week especially if a bearish report comes into play. TREND: LOWER –CHART STRUCTURE: EXCELLENT
Silver Futures--- Silver futures in the December contract rallied $.60 this Friday afternoon closing right near session highs at 23.85 bouncing off the 10 day low at 23.00 and if somebody is looking to get into this market on the upside my suggestion would be to either buy the futures contract and place a stop below the 10 the low which is at 23.00 risking around $850 from today’s price on a mini contract or a bull spread or outright call limiting your risk to what the premium costs. I have been recommending the silver market for quite some time and I do believe prices are headed higher not just because of the problems in the Mideast but because prices have come down dramatically and there still is tremendous demand for this product especially in electronics. Silver has been consolidating the recent run-up from the $19 level to $25 and I still think there’s a possibility prices could hit between 28 – 30 especially if the Syria situation gets out of control or another wrench is thrown into the closet that we don’t know about at this point pushing precious metals higher. Remember silver prices came from $50 just a couple years back so at 23 it looks relatively cheap. TREND: HIGHER –CHART STRUCTURE: EXCELLENT
Soybean Futures— Soybean futures in the November contract had a wild trading week reaching as high as 14.08 ½ on Tuesday after the long holiday weekend which was a double top from the week before as prices sold off later in the week only to finish unchanged this Friday afternoon at 13.67 up slightly for the trading week as traders are waiting next week’s USDA report which will show carryover and crop production and is one of the highest anticipated crop reports that I can remember in quite some time. The soybeans were still unable to fill their price gap at 13.31 which makes me nervous if I was bullish the market .There are many reports out of the Midwest with certain locations having record crops and then there are stories in southern Illinois and Iowa where the crop has been hurt tremendously as there is a wide array of trade estimates for this report from as low as 2.98 billion bushels & as high as 3.30 billion bushels and I can’t remember the last time soybeans had under a 3 billion bushel year and that tells you that this could be a terrible crop but only time will tell to see what the USDA report states. One other main statistic in the report is carryover and last month’s report lowered carryover from 295 million bushels to 220 million bushels and that really was the main reason this rally started as trade estimates now are as low as 180 million bushels and as high as 250 so this is going to be one interesting report. In my opinion I’m still advising traders to sit on the sideline in the soybean market because it wouldn’t surprise me if we were up $.50 on Monday or down $.50 and I believe you would be better off waiting for chart structure to develop so be patient at this time. TREND: LOWER –CHART STRUCTURE: TERRIBLE—RISK--HIGH
Corn & Wheat-- The corn and wheat market rallied this afternoon after selling off heavily in the last several trading sessions especially in corn finishing at 4.68 up $.07 and down about $.16 for the week as this was the 1st up day in quite some time. The corn crop still looks relatively solid at this time as the good/excellent rating is at 56% & looks like a 13.8 billion crop is coming at harvest time as 2,000,000 acres have already been harvested in certain parts of the Mid West with areas in Indiana claiming over 200 bushels an acre at this point which is pressuring corn prices every single day basically retesting contract lows at 4.46 which only $.22 away from today’s closing price. Wheat futures are still right at contract lows, however finishing today up $.07 at 6.47 as both wheat and corn have filled their price gaps on the daily chart & I believed that was a bullish sign, however corn prices hit 3 week lows in yesterday’s trade so I’m advising traders to sit on the sidelines in corn and wheat as well. Sometimes not trading is the best situation because of the fact that corn and wheat don’t have any trends at this point but they are starting to develop excellent chart structure so if you’re looking to be a bottom picker my suggestion would be to buy corn at today’s price and place a stop below the contract low of 4.45 risking around $1,300 per contract and if you’re looking to buy the wheat market at today’s price place a stop loss at the contract low of 6.35 a bushel risking around $700 per contract. Traders are awaiting next week’s USDA crop report which showed very weak fundamentals for wheat in the last report with an excellent crop and average demand but it will be interesting to see what the government states about the corn carryover and what their estimates on the size of the crop will be. TREND: LOWER –CHART STRUCTURE: IMPROVING
Coffee Futures-- Coffee prices rebounded slightly this Friday afternoon finishing up 100 points in the December contract trading at 117.85 just the eyelash away from the 20 day moving average which is at 119.90 and still below its 100 day moving average which is still quite a distance away, however if prices get above 120 in the short term you could see some buy stops triggered pushing the market higher. Coffee prices hit 4 year lows in yesterday’s trade all the way down to 115.25 with prices we have not seen since March 2009 settling last Friday at 116.30 actually finishing higher for the week with an extremely tight trading range in the last 3 weeks with outstanding chart structure if you’re looking to get long this market my suggestion would be to put a stop below the 4-year low of 115.25 risking around $700 from today’s current price levels if you are bullish and trying to pick a bottom. The problem with commodities down in Brazil including orange juice, sugar, and coffee is the Brazilian currency which is called the REAL has been hitting new lows against the U.S dollar which is putting pressure on these markets in the short term, but eventually I think that will stabilize and many commodities have started to rally which also could lend support. TREND: LOWER –CHART STRUCTURE: EXCELLENT
Sugar Futures--- Sugar futures rallied sharply this Friday afternoon in New York up 28 points at 16.79 hitting a 3 week high as the probability of a possible bottom is improving on a daily basis in my opinion with the next major resistance at 17.28 – 17.50 & if that level is broken you are talking about 4 month highs just like that. Sugar futures are trading above their 20 day moving average but below their 100 day moving average which stands at 16.95 and I do believe there are buy stops at that level which could push prices back up into the mid-17s very quickly. Sugar futures in the October contract settled last Friday at 16.34 going out today at 16.79 up 45 points having one of its most productive weeks to the upside in quite some time. I have advising traders to be long this market placing a stop at 16.28 because the risk was extremely small about $200 now if you’re looking to get long the market at today’s prices your risk is around $575 and I still believe that the chart structure and the fact that crude oil prices are right near contract highs once again will push sugar prices higher. TREND: HIGHER –CHART STRUCTURE: EXCELLENT
Lean Hog Futures—The hog market hit new contract highs again today trading higher for the 6th trading session up another 140 points trading at 90.82 rallying about 700 points in the last 2 weeks with poor chart structure due to the fact that the 10 day low is around 84 risking around $2,600 per contract if you are buying a futures contract at today’s price but the stop will be raised soon hopefully limiting your risk significantly. The chart has been up and down in the last 2 months but always trending higher in the long run and in my opinion I’ve seen better looking charts in the past because I don’t like straight up and straight down chart patterns. TREND: HIGHER –CHART STRUCTURE: POOR –RISK-MODERATE—HIGH
U.S Dollar Index Futures-- The U.S dollar index in the December contract was down sharply today trading at 82.40 lower by 48 points against the major foreign currencies especially against the Yen & Peso which were both up 100 points today. I have been recommending traders to take a long position buying a futures contract and place a stop below the 10 day low which was just hit on August 20th at 81.40 risking around $1000 per contract as I do think the momentum will continue to the upside here in the short term as investors are fleeing out of European banks and putting the money back in the U.S dollar & in my opinion I believe that is a wise decision which could prop up prices which have come down dramatically in recent weeks. TREND: HIGHER -CHART STRUCTURE: IMPROVING
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
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.
Michael Seery, President
Phone # (800) 615-7649