Chart of The Week - Live Cattle

Posted on by The INO.com Team

Each Week Longleaftrading.com will be providing us a chart of the week as analyzed by a member of their team. We hope that you enjoy and learn from this new feature.

Live Cattle Futures Will Continue to Rise Throughout the Summer.

This week's focus turns to August Live Cattle Futures. I am sure many readers have seen the price of beef steadily increasing, especially as of late. In recent years, the state of Texas has been experiencing severe drought conditions which have significantly depleted the state's water source and has limited the amount of cattle that it produces. These conditions have caused ranchers to limit the amount of cattle output, or in some cases close up shop completely. We've had less and less supply to consume which has caused Live Cattle prices to steadily rise.

Over the coming summer months, I expect this trend to continue. US cattle herds are currently at a 54 year low. Along with already tight supply fundamentals, there have been almanac predictions for exceptionally hot conditions across much of the country, Texas included, in late June and through the month of July. The extreme seasonal weather that much of the country saw this past winter is expected to continue throughout the summer. I think that the conditions in Texas will continue to keep supply tight and increase the price of Live Cattle into the month of August.

The case for a bullish Live Cattle market is also strong on the technical side. We have seen a steep uptrend in Live Cattle futures since late last year. In the past 2 weeks, the market has consolidated its bullish move to form a perfect pennant pattern which is a continuation signal. If the market breaks this pennant formation strongly to the upside, the next near-term target would be 146.00. Continue reading "Chart of The Week - Live Cattle" →

Yellen's Wand Is Running Low on Magic

Posted on by The INO.com Team

By Doug French, Contributing Editor

How important is housing to the American economy?

If a 2011 SMU paper entitled "Housing's Contribution to Gross Domestic Product (GDP)" is right, nothing moves the economic needle like housing. It accounts for 17% to 18% of GDP.

And don't forget that home buyers fill their homes with all manner of stuff—and that homeowners have more skin in insurance on what's likely to be their family's most important asset.

All claims to the contrary, the disappointing first-quarter housing numbers expose the Federal Reserve as impotent at influencing GDP's most important component.

The Fed: Housing's Best Friend

No wonder every modern Fed chairman has lowered rates to try to crank up housing activity, rationalizing that low rates make mortgage payments more affordable. Back when he was chair, Ben Bernanke wrote in the Washington Post, "Easier financial conditions will promote economic growth. For example, lower mortgage rates will make housing more affordable and allow more homeowners to refinance."

In her first public speech, new Fed Chair Janet Yellen said one of the benefits to keeping interest rates low is to "make homes more affordable and revive the housing market." Continue reading "Yellen's Wand Is Running Low on Magic" →

Weekly Futures Recap With Mike Seery

Posted on by The INO.com Team

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 June contract are trading right at their 20 and 100 day moving average which doesn’t happen very often telling you that this market has basically been going sideways over the last 2 months with very little volatility is as prices seem to be bottoming out around the 1,270 – 1,280 at the current time I’m sitting on the sidelines in this market as there is no current trend but a breakout seems to becoming in my opinion as I do think with low interest rates remaining for quite some time that gold prices are currently bottoming out.

If you’re looking at buying this market at today’s price of 1,294 I would place your stop loss below the 4 week low 1,275 an ounce risking around $20 per contract or $2,000 if you’re looking at a bearish position I would sell at today’s price while placing my stop above the 10 day high which stands at 1,310 risking around $1,700 per contract as the gold chart has excellent chart structure allowing you to place tight stops. The story this week was a lot of money going into the U.S treasuries as investors think the U.S could be slipping into a recession and if that is true you would have to assume that gold prices will benefit from bad economic news so keep a close eye on this market.
TREND: SIDEWAYS
CHART STRUCTURE: OUTSTANDING

Continue reading "Weekly Futures Recap With Mike Seery" →

Were The New Market Highs A Bull Trap?

Posted on by The INO.com Team

On Tuesday we witnessed the S&P 500 and the DOW make new all-time highs. What is the significance of this? If you've been following my work and reading our comments then you're probably familiar with the 52-Week New Highs on Friday Rules which go like this:

Rule #1: On a new 52-week high, when the market closes at or close to its high on a Friday, buy and go home long for the weekend.

Rule #2: Exit the long position on the opening the following Tuesday.

Rule #3: If the market opens lower on Monday, exit this position immediately.

Since making their highs on Tuesday, the DOW and S&P 500 have been steadily moving lower and are in danger of closing lower for the week. Doing so would create a "negative engulfing line." A "negative engulfing line" or "bearish engulfing line," as it is some times called, is when the market price action engulfs the previous open and high period for the preceding week or day. If this turns out to be the case for the DOW and S&P 500 and this coming week they both close lower for the week, then the odds are pretty high that a top is more than likely in place. Continue reading "Were The New Market Highs A Bull Trap?" →

Is Gold Getting Ready To Move To The Upside?

Posted on by The INO.com Team

Today I would like to share with you some observations I have made in the Gold (FOREX:XAUUSDO) market. This market is looking more and more interesting right now. In this short 4 minute video, I point out some key technical characteristics that I believe will be driving gold in the future. I also give you a very important level in gold that, in my opinion, will skyrocket gold to new highs.

If you have a few minutes, you may enjoy learning how you can trade gold using MarketClub's Trade Triangles. In the past, the success rate of the Trade Triangles in the second quarter of the year was about 80%. With that in mind, I am watching Gold (FOREX:XAUUSDO) very closely.

Every success with MarketClub,
Adam Hewison
President, INO.com
Co-Creator, MarketClub