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

Gold futures in the August contract settled last Friday in New York at 1,172 an ounce while currently trading at 1,201 an ounce rallying sharply on rumors of a Greece exit possibly happening over the weekend sending prices sharply higher as I was recommending a short position from around the 1,170 level getting stopped out in yesterday’s trade losing around $30 or $1,000 per mini contract plus slippage and commission.

Janet Yellen and the FOMC committee did not raise interest rates earlier in the week sending gold sharply higher hitting a 3 week high but I still remain skeptical of this rally as a deal with Greece will occur in my opinion as the stock market still remains strong keeping money out of the gold market in the short term.

Gold prices have been trading sideways for quite some time breaking out a couple weeks back as this trade went nowhere until yesterday sending high volatility back into this market as I will sit on the sidelines and look at other markets that are beginning to trend as gold remains extremely choppy at the current time.

The U.S dollar is trading near a 6 month low and that’s propping up the precious metals in today’s trade as the next major level of resistance to the upside is 1,225 but I will wait for better chart structure to develop.
TREND: MIXED
CHART STRUCTURE: POOR

Silver Futures

Silver futures in the July contract settled last Friday at 15.82 an ounce while currently trading at 16.01 continuing its choppy trend right near critical support in my opinion as prices have not rallied much despite the fact that gold rallied $28 dollars in yesterday’s trade . I do believe if 15.40 is broken this market turns extremely bearish, however prices have rallied off that level many times so be patient and wait for the true breakout to occur as I’m sitting on the sidelines at the current time.

Silver futures are trading below their 20 and 100 day moving average telling you that the trend is to the downside, however I don’t like to trade choppy markets so be patient and wait for the chart pattern to improve while keeping a close eye on 15.40 because if that’s broken I think prices could head substantially lower as I don’t see any reason to own the precious metals at the current time.

The problem with the precious metals is the fact that U.S interest rates are on the rise coupled with the fact of a strong U.S dollar longer term as all the interest remains in the stock market which is still right near an all-time high so wait for the true breakout to happen.
TREND: LOWER
CHART STRUCTURE: POOR

Live Cattle Futures

Live cattle futures in the December contract settled last Friday at 154.15 while currently trading at 153.15 down 100 points for the trading week resting against a 4 week low and if prices break 153.00 I would recommend a short position while placing your stop above the 10 day high which currently stands at 156.82 risking about 400 points or $1,600 per contract plus slippage and commission.

The chart structure in this market will not improve for another five days as prices are trading below their 20 but above their 100 day moving average as I have a feeling prices topped out at the 157 level last week as hog prices continue to move lower which I’m currently recommending a short position will start to pressure cattle prices.

Traders are awaiting this afternoons cattle on feed report which should send high volatility into this market in Monday’s trade as I think prices have turned as the risk/reward is in your favor at the current time as prices have rallied about 10% over the last four months and remember the fact that prices can become extremely volatile with tremendous price swings on a daily basis as I think volatility will come back into this market to the downside.
TREND: MIXED-LOWER
CHART STRUCTURE: SOLID

Soybean Futures

Soybean futures in the November contract settled last Friday in Chicago at 9.04 a bushel then actually hit a fresh contract low on Monday morning before rallying substantially hitting a four week high at 9.43 a bushel up over $.40 for the trading week on concerns of wet weather causing massive planting delays especially in Kansas and Missouri.

Traders are awaiting the June 30th USDA acres report which will definitely tell us how many acres were actually planted because at this time nobody really knows as 88% was only planted as of last Monday slightly behind the five-year average, however we are having outstanding weather in the Midwestern part of the United States currently but short term prices remain strong.

Soybean prices are trading above their 20 but still below their 100 day moving average with poor chart structure as I’m sitting on the sidelines in this market as volatility certainly has come into play and will remain high over the next several months during the growing season so wait for better chart structure to develop.

Soybean meal in the December contract has hit a 5 week high which is pushing soybean prices higher as well as the next couple of weeks are critical as the last acres report in 2014 sent soybean prices down 70 cents so you must respect the risk which will increase exponentially.
TREND: HIGHER
CHART STRUCTURE:POOR

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

Sugar Futures

Sugar futures hit a fresh 6 year low this Friday afternoon in New York currently trading at 11.12 a pound after settling last Friday at 11.72 closing right at session lows as I’ve been recommending a short position from 12.00 & if you’ve been following any of my previous blogs you understand that this trend is getting stronger as prices are trading far below their 20 and 100 day moving averages.

Sugar prices have traded lower 4 out of the last 5 trading sessions and if you took the original trade continue place your stop loss above the 10 day high which currently stands at 12.25 as the chart structure is poor at the current time due to the fact that prices continue to head lower on a daily basis.

Sugar production has been massive over the last several years sending large supplies onto the market coupled with the fact that the Brazilian Real is historically weak against the U.S dollar which continues to put pressure on sugar prices as I’m looking to add more contracts to this position once the chart structure improves and the risk/reward meets criteria which could happen in the next couple of days.
TREND: LOWER
CHART STRUCTURE: POOR

Cotton Futures

Cotton futures in the December contract are trading below their 20 and 100 day moving average settling last Friday in New York at 64.66 while currently trading at 63.58 slightly lower for the trading week and down sharply this Friday afternoon selling off 120 points as this has been one of the choppiness markets I can remember in a long time as I have not traded cotton for months and if you look at the daily chart it’s absolutely terrible in my opinion.

As I’ve talked about in many previous blogs I definitely stress the fact to avoid markets like this because they are extremely difficult to trade successfully in my opinion as what we are looking for are trends and there is no trend in cotton at the current time despite the fact that we will not produce a record here in the United States but the problem is worldwide supplies are very large keeping a lid on prices in 2015.

Cotton prices are entering the extremely volatile summer season as weather concerns can push prices rather quickly, however at the current time weather conditions are solid at the current time as the 7/10 day forecast shows adequate rain with normal temperatures as I don’t think I will be involved in this market for quite some time until the chart structure improves.
TREND: MIXED
CHART STRUCTURE: TERRIBLE - AVOID

Corn Futures

Corn futures in the December contract settled at 3.69 a bushel last Friday in Chicago while currently trading at 3.69 a bushel unchanged for the trading week selling off over 4 cents this Friday afternoon reversing earlier gains in the trading week on concerns of excessively wet conditions in much of the Midwestern part of the United States with major concerns in Kansas and Missouri.

Traders are awaiting the June 30th crop report which will show actual acres which will send high volatility into this market but at the current time I’m still sitting on the sidelines as I was stopped out in last week’s trade so wait for better chart structure to develop as prices are trading above their 20 but still below their 100 day moving average telling you that the trend is mixed.

Soybean prices have rallied substantially this week also due to wet conditions which might not allow as much planting as expected and that’s supporting corn prices in the last several days. Volatility in corn has definitely come upon us as we enter the hot and dry season as tremendous price swings will occur on a daily basis increasing risk so make sure if you trade this market that you risk 2% of your account balance on any given trade.

As I write this article in the state of Illinois the corn crop looks outstanding in my opinion as the wet conditions have not hampered the crop at this time as the U.S dollar is now trading at a 6 month low also pushing up grain and many commodity prices this week.
TREND: LOWER
CHART STRUCTURE: IMPROVING

Lean Hog Futures

Lean hog futures in the December contract settled last Friday in Chicago at 64.70 while currently trading at 61.50 down 300 points for the trading week hitting a contract low as I’ve been recommending a short position from 69.00 and if you took that trade continue to place your stop loss above the 10 day high which stands at 67.50 which is quite a distance away but the chart structure will improve on a daily basis lowering monetary risk.

Hog prices are trading far below their 20 and 100 day moving average and if you have been reading any of my previous blogs my theory states the farther away prices are from their moving averages the stronger the trend as over supplies in the latter half of 2015 should continue to keep a lid on prices as who knows how low hog prices could actually go.

If you took the original trade we are looking to add more positions to the short side were just waiting for the risk/reward to be favor and at the current time this does not meet criteria so be patient.
TREND: LOWER
CHART STRUCTURE: POOR

Wheat Futures

Wheat futures in the December contract settled last Friday in Chicago at 5.25 a bushel while currently trading at 5.07 down about 18 cents for the trading week with high volatility as prices are trading below their 20 and 100 day moving average, however I have been sitting on the sidelines in this market as prices have been extremely choppy as I continue to stress avoiding this market at the current time.

The chart structure in this market is absolutely terrible with huge price swings up and down with weak demand pushing prices lower this week but concerns about quality sending prices sharply higher as last week wheat traded as high as 5.57 a bushel looking breakout unable to cross the critical 5.65 level. In my opinion I think you have to be patient with this trade and wait for a tighter chart structure to develop with less volatility therefore allowing you to place a tight stop therefore reducing monetary risk as we enter the highly volatile summer season.

If you believe wheat prices have bottomed I would buy a futures contract at today’s price while then placing the stop at the contract low of 4.85 risking around 1,000 per contract plus slippage and commission but I remain neutral.
TREND: MIXED
CHART STRUCTURE: TERRIBLE - AVOID

Trading Theory

What do I mean when I talk about chart structure and why do I think it’s so important when deciding to enter or exit a trade? I define chart structure as a slow grinding up or down trend with low volatility and no chart gaps.

Many of the great trends that develop have very good chart structure with many low percentage daily moves over a course of at least 4 weeks thus allowing you to enter a market allowing you to place a stop loss relatively close due to small moves thus reducing risk.

Charts that have violent up and down swings are not considered to have solid chart structure as I like to place my stops at 10 day highs or 10 day lows and if the charts have a tight pattern that will allow the trader to minimize risk which is what trading is all about and if the chart has big swings your stop will be further away allowing the possibility of larger monetary loss.