"Stay Home Save Lives" Drives Oil Futures Lower

Crude Oil Futures

Crude oil futures in the May contract is trading lower for the 2nd consecutive session after settling last Friday in New York at 22.63 a barrel while currently trading at 22.23 down about 40 cents for the trading week continuing its bearish momentum.

Fundamentally speaking, the energy complex sold off sharply, with oil prices sinking after the Trump administration canceled its plans to buy crude oil to replenish the Strategic Petroleum Reserve (SPR). Then the energy complex extended its losses Thursday on dire predictions from the International Energy Association (IEA).

I am not involved, but I do think prices will break the $20 level as I'm certainly not recommending any bullish position as weakening demand due to the Coronavirus causing millions of Americans to work from home while not driving.

Crude oil prices are trading far below their 20 and 100-day moving average as the trend is to the downside as unleaded gasoline is right near an all-time low as that is also putting pressure on oil in the short-term. If you are short a futures contract, I would place the stop loss at 28.50 as an exit strategy as I do think $15 a barrel is a realistic number that could happen in the coming weeks ahead.

TREND: LOWER
CHART STRUCTURE: POOR
VOLATILITY: HIGH

Silver Futures

Silver futures in the May contract is currently trading at 14.51 an ounce after settling last Friday in New York at 12.38 up over $2 for the trading week experiencing high volatility as prices hit an 11-year low last week. Silver has been mirroring the gold market, which is also having tremendous price swings daily. Continue reading ""Stay Home Save Lives" Drives Oil Futures Lower"

Coronavirus Brings Volatility To Futures

Gold Futures

Gold futures in the April contract is currently trading at 1,497 an ounce after settling last Friday in New York at 1,516. However, that doesn't tell you the whole story as prices had a $125 range on Monday opening sharply higher and then plunging to a 7 month low as prices traded down to the 1,450 level in a highly volatile trading week.

The U.S. stock market was sharply lower once again with wild price swings daily as the Coronavirus has thrown a wrench into the closet towards many different commodity sectors. I am currently not involved in this market as the risk/reward is not in your favor to take a bullish or bearish position as the volatility is too high.

Gold prices are trading below their 20 and 100-day moving average as the trend is lower as prices have dropped over $200 over the last 2 weeks as nobody seems to want to own anything at the current time. Margin calls are to blame for the weakness that we have experienced over the last several days as silver prices have also hit decade-low putting pressure on gold as well. However, I do think the downside is limited. Still, I will wait for the chart structure to improve, coupled with lower volatility.

TREND: LOWER
CHART STRUCTURE: POOR
VOLATILITY: HIGH

Silver Futures

Silver futures ended the week on a positive note up $0.45 at 12.58 an ounce after settling last Friday in New York at 14.50 down over a $1.80 for the trading week hitting an 11-year low as sheer panic has entered the commodity and stock sectors due to the Coronavirus.

Silver prices topped out on February 24th at $19 as we've plunged over the last month as nobody wants to own anything at the current time until some type of stabilization with the U.S. stock market occurs as that might take some time. I am not involved as the volatility is too high; therefore, the risk/reward is not in your favor as we will have to see what the government bailouts look like as we will get more clarity on that situation in the coming days ahead. Continue reading "Coronavirus Brings Volatility To Futures"

Why Gold Futures Are Falling

Gold Futures

Gold futures in the April contract experienced a wild trade and volatile trading week settling last Friday in New York at 1,672 an ounce while currently trading at 1,519, ending the week on a sour note down about $175 as prices have now hit a 2 1/2 month low.

The Dow Jones Industrial Average experienced its worst trading session in 33 years yesterday, and margin calls across the board are to blame for the declines in the precious metals. Volatility is extraordinarily high at the current time, all due to the Coronavirus, which is wreaking havoc on all sectors.

I do not have any precious metal recommendations as I will be looking at possible bullish positions in the coming days ahead if prices get out of control to the downside. However, the chart structure is terrible as the risk/reward is not in your favor, and sometimes doing nothing is the best thing to do.

Gold prices are now trading below their 20 and 100-day moving average as the trend is negative. The amazing thing about it is prices hit a contract high and 7 year high just in Monday's trade slightly above the $1,700 level, and that's how crazy this market has become, but I do think the downside is limited.

TREND: LOWER
CHART STRUCTURE: POOR
VOLATILITY: HIGH

Silver Futures

Silver futures in the May contract settled last Friday in New York at 17.26 an ounce while currently trading at 15.28 down nearly $2 for the week hitting an 8-month low.

I am not involved in silver or any of the precious metals as there has been massive liquidation due to the Coronavirus panic causing the US equity market to have its worst day in 33 years yesterday. The DOW was down over 2,400 points as margin calls across-the-board produced massive liquidation. The volatility at the current time is very high, and I don't think that the situation is going to change Continue reading "Why Gold Futures Are Falling"

Global Volatility Hits Futures Market

Crude Oil Futures

Crude oil futures in the April contract settled last Friday in New York at 44.76 a barrel while currently trading at 42.24, ending the week on a sour note down nearly 8%. The Coronavirus has curbed demand dramatically and looks to stay that way for several more weeks.

I'm not involved, but I do believe prices will go down to the $35 level. I see no reason to be a buyer of crude oil as the airlines and many other sectors are cutting back activities, therefore, demand for oil is extremely weak, and if you are short, stay short as there is significant room to run.

Oil prices are trading far below their 20 and 100-day moving average as this trend is strong to the downside as prices hit a 14-month low. The volatility remains high as that situation will not change as sheer panic has entered this market as nobody wants to travel at this time.

Oil prices are trading far below their 20 and 100-day moving average. This trend is strong to the downside as heating oil and gasoline continue to plummet weekly as you will start to see that reflected in your local gas stations as a bottoming out pattern has not been formed.

TREND: LOWER
CHART STRUCTURE: POOR
VOLATILITY: HIGH

Natural Gas Futures

Natural gas futures in the April contract settled last Friday in New York at 1.68 while currently trading at 1.72 in a relatively quiet non-volatile manor this week as prices remain on the defensive.

Most commodity sectors this week sold off due to the Coronavirus coupled with the fact of above-average temperatures in the midwestern part of the United States, which continues to put pressure on this commodity. I am not involved. However, if you are short, I would place the stop-loss at 1.89 as an exit strategy. However, the chart structure will not improve another 4 trading sessions, so you will have to accept the monetary risk. Continue reading "Global Volatility Hits Futures Market"

Futures Market Is Not Immune To Coronavirus

Natural Gas Futures

Natural gas futures in the March contract settled last Friday in New York at 1.91 while currently trading at 1.71 lower for the 3rd consecutive session while hitting a 4 year low. Fundamentally speaking, according to Energy Weather Group, the U.S. winter through January is the 2nd warmest winter season in 70 years, which has reduced heating demand for natural gas coupled with elevated inventories.

All commodity sectors, including U.S. equities, are on the decline as nobody wants to own anything until the Coronavirus shows more clarity. The next major level of support is down at the 150 level. I see no reason to be a buyer at this time as the entire energy sector is experiencing bearish trends, and if you are short, stay short as gas prices are trading far below their 20 and 100-day moving average as the trend clearly is to the downside.

TREND: LOWER
CHART STRUCTURE: POOR
VOLATILITY: AVERAGE

Silver Futures

Absolute panic has entered all commodity and stock sectors this week because the Coronavirus is spreading worldwide, sending huge volatility across-the-board. Silver prices hit a 5 month high on Monday as now prices are at a 2 month low after settling last Friday in New York at 18.61 an ounce while currently trading at 17.20 down about $1.40 for the week.

I have been recommending a bullish position from around the 18.13 level while getting stopped out around the 17.20 area as it is time to move on and wait for some sanity to come back into these markets. Continue reading "Futures Market Is Not Immune To Coronavirus"