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.
Soybean Futures-- Soybean futures had a wild trading week ending lower by $.13 this Friday at 13.83 but having a very bullish USDA crop report despite the fact that we are going to have the 4th largest crop in U.S history, but the carryover level dropped from 220 bushels all way down to 150 million bushels which now means the carryover in soybeans is tight again which should keep prices high for quite some time. We thought the carryover number was going to be 295 million bushels earlier in the summer and that’s how much this figure has dropped and if you go into the next report with possibly an even lower crop than 3.14 billion bushels and a carryover of 100 million prices could really move to the upside in my opinion. The grain complex in general is still in a bearish trend except for soybeans as the spread price between corn and soybeans is right near record levels as there is still huge demand for soybeans and I wonder what the next crop report is going to say as this was a disappointing crop year in my opinion. This year’s crop is only 3% higher than last year’s drought stricken crop which is amazing in my opinion but we just had too many bad things happen this year with cool & wet weather and then hot & dry with a very sporadic weather pattern causing the poor crop this year as now we start to enter Brazil’s planting season which is expected to be another record crop. TREND: HIGHER –CHART STRUCTURE: IMPROVING
Corn & Wheat Futures-- The corn market has a negative USDA report stating that the U.S produced 13.83 billion bushels which is going to be a record crop which will send carryover levels to 12 year highs in my opinion as lower prices are ahead as we go into harvest season. Traders were expecting some type of decline in the crop due to the hot weather, however corn is made in the month of July not in September or early August and I do believe that volatility is going to come out of this market & you might start to see the classic bearish trend where prices grind lower on a daily basis as harvest pressure or seasonality could keep a serious lid on prices for the rest of the year. Wheat futures are down $.12 in the December contract at 6.41 still stuck in a sideways channel and I’m still advising traders to sit on the sidelines in these markets but I do think prices are headed lower as the only grain that is bullish right now is the soybean market. Corn futures are trading below their 20 and 100 day moving average with already 2,000,000 acres harvested with outstanding results so far and I do believe that this crop could actually improve and possibly get up to 14 billion bushels by the next report which will send the carryover even higher and I do think prices could get under $4 come Christmas time. TREND: LOWER –CHART STRUCTURE: EXCELLENT
Gold Futures--- Gold futures had one of its worst weeks since early June dropping over $70 hitting a 4 week low as concerns over the fight in Syria have diminished tremendously as the United States has backed out of a possible attack sending gold sharply lower in the last couple of days settling today at 1,310 also Goldman Sachs coming out stating that prices could go under $1,000 an ounce which also pressured gold this week. Gold is now trading below its 20 and 100 day moving average and sold off $130 from the recent high that was hit 2 weeks ago at 1,434 an ounce and I was wrong on this trade as I was recommending to be buying gold but once prices hit a 10 day low it’s time to move on. TREND: LOWER –CHART STRUCTURE: MODERATE
Silver Futures-- Silver futures sold off sharply this week as well finishing lower by $2 to close right around $22 an ounce as money came out of the precious metals & into the S&P 500 once again as tensions with Syria sent investors leaving the silver market in a hurry, however as I’ve been stating in previous blogs I am bullish silver prices & I think you should take advantage of big down days like today when prices were down another 75 cents only to finish unchanged as I do believe silver prices are extremely cheap but you must keep a long-term perspective. If prices drop $3 you can’t panic because this is something that should be held in a diversified portfolio over the course of time and should be purchased on dips in my opinion but if you follow these prices on a minute to minute basis it will drive you crazy so have a realistic view of the markets and under trade the market so you can stay in this for a long period of time. If inflation does come about & in my opinion it will because of population growth alone and if you look around many of the markets are starting to move sharply higher like oil and the housing market which has sprung back from lows & now at all-time highs in certain areas. Silver prices look cheap at these levels and one day you will look back and say why didn’t I buy when prices were low just like the stock market 5 years ago especially with the demand for electronics booming and getting bigger. TREND: MIXED –CHART STRUCTURE: EXCELLENT
Cotton Futures--- Cotton futures were very quiet this Friday afternoon in New York trading right around 84.50 in a directionless trend basically trading sideways for the last several weeks trading right at its 20 day moving average but below its 100 as the USDA lowered U.S production slightly but increased worldwide supplies in yesterday’s report. The chart structure in cotton is improving dramatically as volatility has really slowed down in the last couple of weeks but I’m advising traders to sit on the sidelines right now because there is no trend but there could be a breakout relatively quick due to the fact that we have been going sideways for several weeks as the fundamental news was mixed. TREND: MIXED –CHART STRUCTURE: EXCELLENT
Coffee Prices-- Coffee prices sold off 60 points this Friday afternoon at 120.00 but up about 200 points for the week still stuck in a 17 day extremely tight consolidation with very little bullish news to prop up prices as massive supplies worldwide are keeping prices right at 4 year lows, however I’m sticking my neck out here and I am advising traders to get long this market placing a stop loss at 114 risking around $2000 per contract as coffee is now trading above its 20 day moving average but below its 100 day moving average with outstanding chart structure & extremely low volatility. Some of the best markets I’ve ever seen have been the ones that have no reason to go up or down and this market has absolutely no reason to move higher with massive supplies across the globe & crops doing extremely well at this time, but this news is already priced into the market and one day this market will start to turn to the upside it’s just a matter of when. TREND: MIXED –CHART STRUCTURE: EXCELLENT
Sugar Futures-- Sugar futures settled this Friday at 17.11 up about 31 points for the trading week which is a pretty decent move for sugar at these relatively cheap prices hitting a 3 week high as prices are trading above their 20 and 100 day moving average for the 1st time in quite a while. Sugar has extremely low volatility at this time as the USDA stated that they will trade sugar for import credits to reduce massive supplies, however it only produced a modest rally this week. I’m advising traders to take a chance at sugar to the upside with outstanding chart structure allowing you to place your stop below the 10 day low risking around $600 per contract at this time as sugar prices are also right near 4 year lows. Volatility in coffee and sugar are extremely low but these markets can become very volatile at times usually created by some type of weather situation affecting crops globally such as a hurricane or drought. TREND: HIGHER –CHART STRUCTURE: EXCELLENT
Lean Hog Futures-The hog market hit new contract highs at 91.65 during the trading week only to sell off slightly to finish at 90.75 which could signal a short term high. If you believe hog prices are too high my suggestion is to sell a futures contract and place the stop above the contract high of 91.60 risking around $400 dollars per contract. The risk/reward picture is in your favor in my opinion because if this is the top the reward should be substantial. TREND: HIGHER -CHART STRUCTURE: POOR -RISK-MODERATE--HIGH
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