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 April contract settled last Friday in New York at 1,191 an ounce while currently trading at 1,213 up over $20 for the trading week right near a 10 week high as I've been sitting on the sidelines in this commodity recommending bullish positions in silver and copper. Gold prices are still trading above their 20-day but below their 100-day moving average as the trend is mixed to higher in my opinion as the U.S dollar is still hovering right around the 100 level as I'm also recommending a short position in that currency at present. The monthly unemployment number was released this morning adding about 227,000 new jobs having very little impact on gold prices in today's trade. The next major level of resistance is yesterday's high around 1,227 and if that is broken, I think we could go back to around the 1,300 level right where we were before the Trump election as there is still room to run to the upside. I want to wait for better chart structure as the 10-day low is too far away at present coupled with the fact that I am already recommending two other precious metals as they all follow one another up or down, so you don't want to be too top-heavy.
TREND: HIGHER
CHART STRUCTURE: IMPROVING

Silver Futures

Silver futures in the March contract settled last Friday in New York at 17.14 an ounce while currently trading at 17.50 up about $0.35 for the trading week as I have been recommending a bullish position originally from around 16.76 and now have added on 2 separate occasions as I remain bullish the precious metals and especially silver prices. If you took the original trade continue to place your stop loss under the 10-day low which stands at 16.63 as the chart structure is not very solid at present due to the run-up in prices, however, it will improve but it will take 4 more trading sessions. Silver prices are now trading above their 20 and 100-day moving average telling you that the short-term trend is higher as I'm also recommending a bullish position in copper which is down 500 points today & has been stuck in the mud over the last 3 weeks. At the current time I'm also recommending a bearish U.S dollar position and if that trade works out, you would have to think that would benefit silver prices as I still think historically speaking silver is very cheap and still has exceptional demand.
TREND: HIGHER
CHART STRUCTURE: IMPROVING - POOR

Crude Oil Futures

Crude oil in the March contract settled last Friday in New York at 53.17 a barrel while currently trading at 53.60 up slightly for the trading week as prices have been stuck in a $2 range for the last 3 trading weeks as I've been sitting on the sidelines waiting for the trend to develop which I think might be to the upside. Oil prices are right at their 20-day but above their 100-day moving average as the chart structure is excellent at the current time as the United States released the monthly unemployment report which stated 227,000 new jobs were added which is a bullish indicator towards crude oil as there could be more demand with more people employed. The U.S dollar is still hovering around 100 which is still a longer-term bearish fundamental indicator, but it seems to me that many of the commodities have already reflected that in their price so keep a close eye on this market to the upside as a 4 week high could be at hand next week. OPEC is hinting that they could possibly cut production once again in 2017 as it seems to me that they want prices back up into the $65/$75 level as that will take time, but I do think with growth coming back into the United States that is bullish stocks and commodities longer term.
TREND: MIXED
CHART STRUCTURE: EXCELLENT

U.S. Dollar Futures

The U.S dollar in the March contract settled last Friday at 100.52 while currently trading at 99.85 down about 75 points for the trading week as I am now recommending a bearish position from around 99.85 & if you took that trade continue to place your stop loss above the 10-day high which stands at 101.01 risking around $1,200 per contract plus slippage and commission. The chart structure will not improve for another 6 days, so you're going to have to accept the monetary risk as prices are still trading below their 20-day but right at their 100-day moving average right near major support in my opinion. The United States released its monthly unemployment number adding 227,000 new jobs having very little impact on the currency market this afternoon as prices are still right near a 6 week low, so I will continue to place the proper stop loss while risking 2% of the account balance on any given trade. Volatility in the dollar is relatively high as we are having large price swings on a daily basis so make sure place the proper amount of contracts, therefore, managing risk properly.
TREND: LOWER - MIXED
CHART STRUCTURE: EXCELLENT

Copper Futures

Copper futures are trading lower for the 3rd consecutive trading session currently down 600 points this Friday afternoon at 2.620 a pound as I've been recommending a bullish position right from this level and if you took that trade continue to place your stop loss under the 10-day low which stands at 2.61 which is just an eyelash away. This has been a very frustrating trade as I have been involved for the last 3 weeks as prices have gone absolutely nowhere despite the fact that silver prices continue to hit weekly highs, but copper cannot get out of its own way. Copper prices settled last Friday in New York at 2.6895 while currently trading at 2.6220 down over 600 points for the trading week now under its 20-day moving average but still trading above its 100-day as prices were unable to break the 2.73 level on a closing basis so now they are testing the bottom end of the trading range in my opinion. The U.S dollar is slightly lower this Friday afternoon as I'm also recommending a bearish position in that currency. However, it's having very little impact on copper prices as higher-than-expected supplies are pressuring prices here in the short term.
TREND: HIGHER- MIXED
CHART STRUCTURE: IMPROVING - EXCELLENT

If you are looking for a futures broker feel free to contact Michael Seery at 312-224-8140 and he will be more than happy to help you with your trading or visit www.seeryfutures.com

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.

Natural Gas Futures

Natural gas futures in the March contract settled last Friday in New York at 3.35 while currently trading at 3.06 down about 30 points for the trading week as I have been sitting on the sidelines in this market as it has remained choppy over the last several months. If you take a look at the daily chart there is a price gap which occurred on November 18th between 3.02/3.06 and I do think that will be filled with the possibility of retesting the contract low around 2.80, but at that level, you have to start thinking prices are getting cheap. Warmer weather in the Midwestern part of the United States is the main culprit for lower prices as the city of Chicago did not receive any snow in the month of January which is remarkable in my opinion coupled with above average temperatures, therefore, increasing supplies. Natural gas prices are still trading below their 20 and 100-day moving average telling you that the short-term trend is lower. However, I'm advising clients to avoid this market at present and look at other markets that are beginning to trend with a better risk/reward scenario.
TREND: LOWER
CHART STRUCTURE: IMPROVING

Rice Futures

Rice futures in the March contract settled last Friday in Chicago at 9.81 while currently trading around 9.60 as I was recommending a bullish position from around the 9.97 level getting stopped out around the 9.60 level earlier in the week taking a relatively small loss while moving on as the grain market continues to go nowhere. At present rice, prices look to test the contract lows around 9.40 as I'm now sitting on the sidelines as prices remain choppy, but are now trading below their 20 and 100-day moving average telling you that the short-term trend is lower. However, there is no solid trend in this commodity at present. Volatility in the grain market is relatively low at the current time, however spring planting is right around the bend and certainly the summer months will increase the volatility tremendously so don't give up on rice as we just have to keep a close eye on this as we still could be involved over the next 6/8 weeks.
TREND: LOWER
CHART STRUCTURE: SOLID

Cocoa Futures

Cocoa futures in the March contract settled last Friday in New York at 2095 while currently trading at 2075 down about 20 points for the trading week hitting a multi-year low continuing its remarkable bearish trend to the downside as I'm currently not involved in this market. The chart structure is very solid as we are testing prices that we haven't seen since 2012/2013 and if the 2000 area is broken there is a chance prices could trade as low as 1500 where cocoa prices traded between 2004/2008, however, I do believe prices are getting cheap. The problem with cocoa at present is weak demand and ideas of larger production numbers coming out of the Ivory Coast which is in West Africa as you have to remember Cocoa can only be grown within 20 miles of the equator & is generally grown in very unstable countries, however at present everything is ideal and the trend is your friend, so it looks to me that lower prices are still ahead. Cocoa prices have been trading under their 20 and 100-day moving average for months as many of the other commodity markets have stopped going down, but cocoa is a different commodity with a different fundamental situation so don't try to catch a falling knife.
TREND: LOWER
CHART STRUCTURE: SOLID

Live Cattle Futures

Live cattle futures in the April contract settled last Friday in Chicago at 117.32 while currently trading at 115.30 down about 200 points for the trading week as I have been sitting on the sidelines waiting for a trend to develop which could happen in the next couple of days. If you take a look at the daily chart there is a price gap that needs to be filled around the 117 level which is still about 125 points away and if that is filled I will be taking a short position while placing the stop loss above the 10-day high around 119.80 risking around 280 points or $1,200 per contract plus slippage and commission. The chart structure in cattle will start to improve on a daily basis, therefore, lowering monetary risk so keep a close eye on the 117 level as I think this is just a kickback in prices as that gap was formed off of the bearish cattle on feed report which was released last Friday. Cattle is now trading below its 20-day moving average for the 1st time in months as prices peaked on January 19th around the 120.30 level as I do think prices look expensive, but wait for the gap to be filled.
TREND: HIGHER - MIXED
CHART STRUCTURE: IMPROVING

Lean Hog Futures

Lean Hog futures in the April contract settled last Friday in Chicago at 68.30 while currently trading at 69.55 up about 125 points for the trading week continuing its bullish momentum as I am currently sitting on the sidelines looking to enter into a trade. Prices are now right near a 7 month high as the February contract has been on a tear to the upside as there is a short-term squeeze which means strong demand here in the short term occurring pushing prices higher on a daily basis. Hog prices are trading above their 20 and 100-day moving average telling you that the short-term trend is higher & if prices break that 70.57 level you would have to think that the bullish trend would continue, however on the short side if prices close below 66.60 you would have to think that a top may have developed as there is a lot to think about in the coming days in the hog market. April hogs bottomed out around the 55 level in September 2016 as they've had a terrific rally. However, supplies are still in abundance as I still think there will be a top in this market soon.
TREND: HIGHER - MIXED
CHART STRUCTURE: IMPROVING

Trading Theory

If you follow this rule you will have a chance of being successful over the course of time, if you don’t follow this rule you will be sure to lose your money quickly. This rule is simple Do Not OVERTRADE EVER for this is an easy way to lose all your capital quickly. My definition of over trading is risking too much money on any given trade, for example if you are trading a $100,000 dollar account and you place a gold trade today you should limit your loses to 2% of the account value which in this case is $2,000 which allows you to be wrong on many trades and still be around to play another day. In futures and option trading you will have losing trades that is for certain so make sure you manage those losses and move on to another trade.