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

As I talked about in yesterday’s blog I am telling investors to remain neutral as I do believe gold prices will remain choppy to lower for the rest of 2014 as prices rallied $9 to trade around $1,200 per ounce as extreme volatility has entered this market and I think today’s price action was very impressive due to the fact that the U.S dollar was up over 50 points which is generally very bearish precious metals, however China cut their interest rate pushing many commodities prices higher. Gold futures are trading above their 20 but below their 100 day moving average moving higher despite the fact that the ECB looks like they’re going to utilize more stimulus which is remarkable in my opinion as I do think if the U.S dollar continues to move higher eventually that will be very bearish gold prices so sit on the sidelines as you do not want to trade a choppy market. This market is extremely volatile with big up price swings and down swings so avoid and move on to a trendy market like the S&P 500. Volatility in gold is amazing lately with many days of a $30 – $50 trading range which is incredible going into the holiday season, however if you remember last year gold’s low was near December 31st and we opened up the next day around $20 higher and I think the same thing will happen because of the fact that stock sales which are losers are sold to offset winning trades come the month of December so I still look for another leg down but still would sit on the sidelines at the current time.
TREND: NEUTRAL
CHART STRUCTURE: POOR

Crude Oil Futures

Crude oil futures are up 30 cents in the January contract trading higher for the 2nd consecutive trading session as a short term bottom may have been placed as China cut their interest rate today sending crude oil sharply higher in early trade trading as high as 77.82 a barrel before retracing while currently trading at 76.22 if you are still short this market I would place my stop above the 10 day high which in Monday’s trade will come down to 77.92 risking around 170 points or $1,700 per contract. The U.S dollar was sharply higher and that’s generally very bearish the commodity markets, however with China cutting their interest rate that combated the negativity coming out of the Euro currency causing short covering across the board as many of the commodities including energies, metals, and the grain sector were all higher today but continue to place your stop loss at that level and see what Monday’s trade brings. The fundamentals in oil still remain very bearish as Saudi Arabia has not cut production & the United States continues its torrid pace of production flooding the world market so even if you are stopped out on this trade sit on the sidelines and wait for another trend to develop as I’m not totally convinced that lower prices aren’t ahead in 2015. Crude oil futures are still trading slightly below their 20 but still far below their 100 day moving average telling you the trend is still to the downside and if the U.S dollar continues to move higher that eventually will put pressure on prices once again in my opinion but on a day-to-day basis anything can occur.
TREND: LOWER
CHART STRUCTURE: EXCELLENT

Orange Juice Futures

Orange juice futures in the January contract are trading higher for the 7th consecutive trading session as cold temperatures have rallied prices nearly 2000 points in the last 2 weeks as I was recommending a short position as that trade was stopped out when prices hit the 10 day high of around 137 earlier in the week as I’m currently sitting on the sidelines as you must have an exit strategy as prices have rallied around 700 points more since we were stopped out as you never know how high or low prices can actually go so you must try to minimize risk in my opinion. Orange Juice prices are trading right after 20 and 100 day moving average hitting a 4 week high in today’s trade as I’m recommending investors to sit on the sidelines and wait for better chart structure as this trade has turned on a dime going from a contract low to a 4 week high in a matter of days as short covering is also to blame. Many of the commodity markets have been rallying in recent weeks due to the fact that China has cut their interest rate trying to spur the 2nd largest economy in the world, however as a trader and a technician I like to trade markets that are trending and this market currently is choppy so sit on the sidelines and look for another market that is currently trending like the S&P 500 & cattle markets to the upside.
TREND: HIGHER
CHART STRUCTURE: POOR

Cotton Futures

Cotton futures in the March contract settled last Friday in New York at 59.63 while currently trading at 59.16 down about 50 points for the trading week still right near a five-year low as the U.S dollar is sharply higher once again today due to the fact of more stimulus in the ECB as well as a rate cut in China which continues to put pressure on cotton prices as I’ve been recommending a short position in the futures & if you took that trade make sure you place your stop above the 10 day high which currently stands at 63.75 risking around 500 points or $2,500 per contract. Cotton prices are trading below their 20 & 100 day moving average telling you that the trend is lower as I still think prices could possibly head into the low 50s as the trend seems to be getting stronger as the chart structure will improve dramatically starting next week. Many of the commodity markets were higher today despite the fact of a strong U.S dollar including small gains in cotton, however I think this will be short lived as the next leg down could start next week as traders are keeping an eye on next month’s USDA crop report which will send volatility back into this market as volatility currently is very low. If you are short this market make sure you have the proper amount of contracts risking 2% of your account balance on any given trade as harvest is in full swing in the southern part of the United States as an excellent crop has developed which could keep carryover levels at historical highs as this market has very little bullish fundamental & technical indicators to push prices higher at the current time.
TREND: LOWER
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

Coffee Futures

Coffee futures in the March contract sold off around 600 for the trading week currently trading at 190.70 in New York with high volatility in the last week with several sharply higher and lower trading sessions as I am advising investors to stay away from this market as the trend is extremely choppy and difficult to trade successfully in my opinion. Coffee prices are trading right at their 20 & 100 day moving average telling you that the trend is neutral as this volatility will remain for months to come as weather in Brazil is very fickle on a week to week basis as drought concerns are still in the back of traders’ minds as the weather currently is positive for production. The chart structure in coffee presently is very poor as I like to trade markets with tight chart structure which allows you to place tighter stop losses lowering monetary risk in my opinion.
TREND: MIXED
CHART STRUCTURE: POOR

Live Cattle Futures

Live cattle futures in the February contract continued their amazing run to the upside trading up another 50 points at 172.30 as I’ve been recommending a long position when prices cracked 170 placing my stop loss at the 10 day low which currently stands at 166 as that stop will be raised on a daily basis starting next week as the trend in my opinion keeps getting stronger to the upside on a weekly basis. Feeder cattle prices are near all-time highs once again today as this market has some of the strongest fundamentals to the upside I have ever seen with the lowest herds in 65 years and insatiable demand regardless of what the price is as we enter the Thanksgiving holiday and the demand season of Christmas as there seems to be no stopping this price action at the current time, however make sure you use the proper amount of contracts placing a stop loss at the 10 day low in case the trend does change. The fact that feed costs have risen substantially over the last 6 weeks which is generally bearish feeder cattle prices which then could put price pressure on live cattle but that’s not even happening as supplies are limited at the current time and it will take at least 8 months to replenish some of the supply problems that we are currently dealing with as prices are trading far above their 20 and 100 day moving average so go with the trend, & don’t try to go short picking a top which is very dangerous and risky in my opinion as the path of least resistance is to the upside.
TREND: HIGHER
CHART STRUCTURE: IMPROVING

Sugar Futures

Sugar futures this Friday afternoon in New York are relatively quiet trading at 16.07 after settling last Friday at 15.90 as I’ve been recommending a short position from around 15.65 as prices have stalled and rallied slightly, however I do think the long-term trend line is still intact and if you took that trade make sure you place your stop above the 10 day high which currently stands at 16.40 risking around 35 points from today’s price levels or $400 per contract. The chart structure in sugar is outstanding at the current time as we are basically trading sideways for the last several weeks so continue to play this to the downside hoping that prices will break the contract low of 15.48 as many the commodity markets in recent days have rallied due to the fact that China cut its interest rate which generally is bullish commodity prices at least in the short term, however the risk/reward is in your favor at the current time so continue to play this to the downside. The sugar fundamentals are rather bearish with oversupply due to the fact of overproduction in the last 3 years as I think that trend will continue unless weather problems arrive in Brazil but it looks like another solid production coming in 2015, however if you are stopped out at 16.40 on a closing basis only sit on the sidelines and look for a better market that is trending.
TREND: LOWER
CHART STRUCTURE: EXCELLENT

Wheat Futures

Wheat futures in the December contract finished up 1 cent this Friday afternoon in Chicago finishing at 5.46 a bushel as I’ve been recommending a bullish position when prices hit a 4 week high around 5.20 a bushel as prices sold off about $.10 for the trading week as the bullish momentum still continues in my opinion but if you took the original recommendation make sure you place your stop below the 10 day low of 5.10 risking around $.36 or $1,800 per contract at today’s price levels. Wheat prices have jumped recently because of the cold weather here in the United States which is below normal at the current time causing concerns about the crop developing poorly however the U.S dollar was up 75 points today which is a bearish fundamental. I would continue to play this to the upside while placing the proper stop risking 2% of your account balance on any given trade as the trend remains bullish as prices are still trading above their 20 & 100 day moving average telling you that the trend is to the upside so continue to follow the trend in my opinion.
TREND: HIGHER
CHART STRUCTURE: IMPROVING

Milk Futures

Milk futures finished higher for the 3rd straight trading session up 25 points or $500 per contract finishing at 18.94 as I’m recommending a short position placing your stop loss above the 10 day high which currently stands at 19.50 risking around 56 points or $1,200 per contract as the trend remains bearish despite today’s up day. Milk futures topped out in late September around 21.40 & have remained in a downtrend as prices are trading below their 20 and 100 day moving average as the chart structure will start to improve on a daily basis so continue to play this to the downside in my opinion. As a commodity trader I think you must broaden your horizons to all markets as long as the chart structure and the risk meet your criteria because it doesn’t matter if it’s in milk or the S&P 500 the whole object of being a technician is to be correct while trying to minimize risk as much as possible.
TREND: HIGHER
CHART STRUCTURE: IMPROVING

U.S. Dollar Index Futures

The U.S dollar is surging this Friday afternoon on comments from the ECB that they will basically do anything to help stimulate the European economy sending the dollar index up 70 points at 88.40 in the December contract as I’ve been recommending a long position as the chart structure is outstanding and if you took that trade place your stop at the 10 day low of 87.28 risking around 100 points or around $1,000 dollars per contract as prices basically have gone nowhere in the last week as the Euro is down over 100 points today and I do think that will continue, however, prices have been choppy in recent weeks but it certainly looks like stimulus will continue in Europe while our quantitative easing program has officially ended so fundamentally speaking the U.S dollar should rise against the foreign currencies but anything can happen but the trend is your friend in the commodity markets so continue to play this to the upside in my opinion. Dollar index futures are trading above their 20 and 100 day moving average telling you that the trend is to the upside and I truly do believe that a secular bull market is at hand but that doesn’t mean you can’t get stopped out of this trade but I do think the dollar index will continue to move higher in the year 2015 as Europe is certainly a mess as the U.S economy is doing very well with the S&P 500 hitting another all-time high today.
TREND: HIGHER
CHART STRUCTURE: EXCELLENT

Wheat Futures

The S&P 500 in the December contract rallied another 5 points hitting another all-time high this afternoon in Chicago trading at 2057 as I’ve been recommending a bullish position when prices cracked above 2148 in yesterday’s trade while placing your stop loss at the 10 day low which currently stands at 2020 and that level will be raised in Monday’s trade to 2025 risking around 32 points or $1,600 per contract. Over the last 10 years the last 6 weeks have been bullish seasonally speaking to the upside as every year has rallied going into the New Year as I think this can occur again this year especially if Apple Computer continues to move higher so play this to the upside as this is one of the strongest trends and I have a hard time believing that prices will sell off in the month of December unless some geopolitical event happens as the trend is your friend and this trend is extremely strong as governments around the world are lowering interest rates while producing quantitative easing which is bullish the stock market. Stock equity futures are trading far above their 20 &100 day moving average telling you that the trend is to the upside as the chart does have outstanding chart structure so continue to buy any dips & play this to the long side as I think there’s a possibility that prices break 2100 come New Year’s Eve in my opinion.
TREND: HIGHER
CHART STRUCTURE: IMPROVING

Do You Add To A Losing Trade?

This rule is extremely important and I witness it being abused constantly creating tremendous loses that are sometimes difficult to come back from. Never add to a losing position because if the position continues to go against you and now you have added even more contracts which are all losing money your account will suffer loses much more than 2% and in some case adding positions and never getting out of a losing trade has wiped peoples trading accounts down to zero because of 1 or 2 bad trades. Remember always play for another day you will have losing trades and the good traders manage losses and move on to the next possible trade.

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

SEERY FUTURES ACCEPTS CANADIAN COMMODITY ACCOUNTS

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.

Michael Seery, President
Seery Futures
Facebook.com/seeryfutures
Twitter–@seeryfutures
Phone #: (800) 615-7649


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