We’ve asked Michael Seery of SEERYFUTURES.COM an IB of Peregrine Finanial Group 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 Busines, and Bloomberg TV. He is also a guest on First Business, which is a national and internationally syndicated business show
Precious Metal Futures---The precious metals this week had an absolutely wild ride with tremendous swings to the upside as well as huge plunges to the downside currently about to finish the week right around 1,590 rallying $35 dollars from session lows today to finish higher by $3 dollars trading as low as 1,556 early Friday morning session and trading at highs of almost 1,642 just a couple of days ago basically last week with $100 dollar trading range to the up and downside which is absolutely remarkable to me, however like a been stating in previous blogs I do not believe you should be in the gold market at this time because there is no trend with an extremely choppy up and down market and generally that loses money for traders trader do very well when there's a trend in one direction. Silver futures traded just below $30 an ounce only to fall out of bed once again remaining in a sideways and choppy market currently trading at 28.48 up slightly for the week in an extremely volatile trade while copper futures which a three-day rally this week settling lower this Friday afternoon down about 800 points to close at 3.28 a pound which is a new closing contract low which tells you that the economies around the world are still slowing and in my opinion I'm still bearish copper prices because there is a trend to the downside, however silver and gold remain incredibly choppy with giant swings up and down and I'm still advise traders or people who are looking to get into the market to sit on the sidelines and wait for a trend to develop. Platinum futures which possibly double bottomed on the daily chart around 1,400 in the July contract are down for the second consecutive day lower by $22 to close around 1,419 an ounce with major support at the contract lows which were struck about two weeks ago and in the last two days have sold off around $45 in a volatile trade
Energy Futures--- Energy futures this week had another wild ride with many of the stock markets around the world and many of the commodity markets as well with crude oil this Friday down around $2 dollars a barrel in early trade only to rally at the closing bell to finish down .40 cents at 84.45 in a hectic trade this week basically unchanged for the week, however yesterday traded as high as 87.03 and on Monday traded as low as 81.21 in an incredibly wild trading week due to the fact of Spain and the European crisis which is forcing commodities up and down on a daily basis because of the great fluctuations of the Euro currency in the last couple of weeks. I look for volatility to continue at these high rates for a long period of time until some type of solution comes out of the European Union until then expect $2-3 dollar moves basically on a daily basis while heating oil futures are also right near seven-month lows down another 200 points in early trade before rallying to finish up 100 point for the trading session to trade at 2.6783 a gallon basically unchanged for the week as well while unleaded gasoline was down another 400 points in early trade only to rally finishing higher by 50 points to trade around 2.69 a gallon also near the lower end of its trading range for the week and still right near contract lows. Natural gas futures for the July contract continue to slide this week however today is up 1 point at 2 .30 looking at the next contract low as major support at about 2.10 and in my opinion will retest within the next couple of weeks but we will see if it breaks it to create new contract lows and in my opinion I believe we are going to have a hot summer which could push up natural gas prices so if you're out there looking to buy natural gas see if it retests 2.10 level and if it bounces off it might be a good opportunity to get long this market with a tight stop loss. As I've stated in previous blogs I am still bearish many of the commodities however this week we got a tremendous rally in several of them making me more neutral on about half of the commodities and many of them in the agricultural sectors, however the crude oil sector is still bearish and still in a severe downtrend and until this European situation is taken care of I look for crude oil prices to retest the 2010 lows of around $75 a barrel which was the last time we ran in to this European problem which never seems to go away because of the fact that these countries keep bailing out Greece and Spain and they are not changing their governing ways.
Currency Futures--- The currency futures traded in a wild and volatile action this week with tremendous swings due to the fact of the European crisis getting headline news almost on a daily basis causing the rallies earlier in the week before today with some profit-taking sending many of the currencies lower against the U.S dollar this Friday afternoon. The U.S dollar index is up by 77 points in the September contract trading at 83.22 while the Euro currency's down 133 points to trade at 1.2480 after hitting a fresh two-week high yesterday on optimism that the Federal Reserve will use more stimulus causing higher commodity and stock prices and a lower U.S dollar, however after Ben Bernanke spoke yesterday he did not hint that that was even on the table pushing prices lower once again. The Australian dollar which lowered their interest rates earlier in the week caused a 500 point rally from session lows only to selloff today on some profit-taking as well down about 70 points to currently trade at 9789 also creating a three week high yesterday's trade. The Canadian dollar yesterday a two-week high in massive short covering, however today is falling down about 60 points at 9674 while the Mexican Peso which I've discussed many times and I'm still bearish all of the currencies against the U.S dollar is down slightly this afternoon trading at 7052 still hovering near contract lows. As stated in many previous blogs I believe in my opinion that the U.S dollar is headed higher because of the flight quality that it has to offer being the reserve currency of the world and I do believe there are massive and I do mean massive problems in Europe so I don't think investors want the Euro currency versus the U.S dollar. It's going to be a very interesting week next week with meetings across the board in Europe this weekend also with Greek elections coming up so we are going to see some tremendous fluctuations in the next three weeks which will also have major impact on stock and commodity prices across the board.
Bond Futures--- Bond futures this week traded lower 4 consecutive trading sessions before this Friday afternoon rallying 1-1-32 points in the 30 year bond in early trade only to sell off towards the closing bell finishing up 6 ticks trading at 148-21 while the 10 year note has also rallied about 2 ticks currently trading at 133 – 15 with the yield of 1.72% which is far off the lows of about 1.45% which was hit earlier last week on major concerns of the European debt situation. The 30 year yield is 2.72% which is still incredibly low but it is off the lows of about 2.50% while the five-year note is up 1 tick at 124 – 00 yielding 0.69% with its low yield of 0.59% which was struck last week again as countries and large funds are parking money in the treasuries as a safe haven. The treasury market has been a terrific bull market for many years and the yields are at such a low point you wonder if you're a long-term investor with a long term horizon possibly selling at these levels in the futures market trying to pick a top or near a top could be profitable in the long term, however with the federal government stating that the yields will stay low until at least 2014 that tells you that the Fed is buying the bonds which keeps yields very low so I still believe they will stay low for a couple years but eventually after 2014 which is a long ways away when you trade futures or stocks to predict but I would have to think rates eventually are going to have to climb. I think higher yields are good for America and good for retired people who are looking for fixed income without taking any risk but at this point there are no yields in a bank or in a CD which hurts a certain section of people therefore they are forced to buy stocks or commodities which are inherently risky. 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.
There is a substantial risk of loss in futures, futures option and forex trading. Furthermore, Seery Trading is not responsible for the accuracy of the information contained on linked sites.
Grain Futures---The grain futures had an incredibly volatile trading week looking ahead to the June 12th crop report which will have a huge impact on short term prices with prices fluctuating tremendously lately with corn prices sharply higher this week supported by forecast of dry weather across the U.S grain belt with possible tightening corn stocks on a projection that the early summer and spring heat will hurt yields while soybean futures were higher by $.44 in the November contract yesterday hitting a three week high on encouraging news from the largest oilseed importer which is China on plans of increasing imports this next year to 57.3 million tons up from 55 million tons a year earlier while China also has lowered interest rates this week trying to spur the Chinese economy. Today the November soybeans are slightly down by 9 cents currently trading at 13.32 a bushel blamed on profit-taking after yesterday’s sharp run-up while December corn futures are higher by 5 cents currently trading at 5.44 with major support at 5.15 which was touched earlier the week and has rebounded due to crop concerns. The wheat futures are slightly lower and still mired in a sideways channel down 6 cents currently trading at 6.35 while rough rice futures are down another 15 cents at 14.07 in the July contract still right near contract lows after falling more than a dollar in the last month. Wheat futures have been in a very choppy market in the last several weeks due to a drought in Australia and Russia that never developed causing prices to sell off all the way back down in the last week, however I still recommend sitting on the side-lines in the wheat market because it has been so choppy in the last several months where traders don't make money in choppy markets they make money in trending markets, however I do believe at this point that corn and soybeans are trending to the upside due to the weather here in Illinois and Indiana as I speak to you from Illinois we are extremely dry and we have been dry all spring and winter and if the hot temperatures start, and what I mean by hot temperatures is anything over 93° or higher you could see real fireworks in the grain market to the upside. Volatility is extremely high at this point where soybeans are basically doing $.30 on any given day and corn is basically moving $.20 as well as wheat so be careful when entering markets make sure you stop losses and make sure you try to minimize your risk when you are wrong using a solid money management technique.
Cotton Futures--Cotton futures had a tremendous rally this week rebounding from contract lows of around 64.50 and traded as high as 72 yesterday before falling back this Friday afternoon on profit-taking down about 250 points to trade right around 69.85 a bale in a very volatile week as traders are looking for the June 12th crop report which should dictate short term prices. In my opinion I think cotton prices have bottomed with a spike low created on this last Monday before prices just skyrocketed on optimism of Chinese demand and governments around the world trying to stimulate economies which will directly affect cotton prices and also at this point the Midwest is having hot and dry weather which also will impact cotton prices which is grown in the south , as I've been stating in many previous blogs I thought cotton could go down to the low 60s which it came very close and rallied sharply this week so I believe that cotton prices have bottomed and if you're lucky enough to get another sharp down to like today I think you take advantage and buy cotton futures going into the summer months remembering that volatility will be extremely high and always use stop losses with a solid money management plan because cotton prices can fluctuate tremendously just look at this week fluctuating 700 points in just two days which equals about $3500 profit or loss on 1 contract if you are wrong or right.
Coffee Futures--- Coffee futures this morning remain in a severe downward trend finishing down by another 120 points in the July contract to close right around 155.45 right near fresh contract lows and the show you how pessimistic and bearish the coffee market is at this point this week many of the commodities had giant spike ups in price such as cotton, soybeans, corn, and many others, however coffee prices stay right at contract lows which tells me that prices are still headed lower like I've stated in previous blogs I think coffee prices can possibly down into the 130s because of an ample supply and a lack of demand for this product at this time. Volatility in coffee is very low and if you are looking at possibly entering this market you might want to look at either purchasing a put or call option depending on what direction you think the market is headed because volatility will increase in coffee just like it's increased all the other commodities and currencies and when coffee volatility increases it has large price moves up and down quickly.
Sugar Futures--- Sugar futures traded sharply higher this week on concerns of the Brazilian crop getting pounded with rain possibly damaging some of the sugarcane causing sugar prices to trade as high as $.20 a pound settling at 19.97 this Friday afternoon right near the session highs after Wednesday's 90 point gain from contract lows creating a 3 week high in price now looking at a possible short term bottom is in place. Many of the agricultural commodities including the grains and cotton have rallied sharply last week due to whether concerns and that is exactly what is happening now when sugar price, however I think this was just a short covering rally and I do believe sugar prices are still headed back down to 2010 lows of around 15.50 with ample supply and lack of demand and if the rain did not hurt this crop which we won’t find out for a little while you could see prices head lower. Remember though these are commodities and they can spike up tremendously on weather problems so if you are looking to get short the market and the market continues to go higher remember you must limit losses to a certain percentage of your trading account by using a stop loss order and a proper money management technique. At this point I still am bearish sugar futures, however the price has rallied and I'm advising traders to basically sit on the side-lines and see if a new trend develops in the next couple of weeks
Orange Juice Futures-- Orange juice futures today are slightly lower trading down by about 100 points at 113.75 a pound hitting a 3 week high on yesterday's trade on the fact that prices may have sold off to dramatically in the last two months or so, however if you look at orange juice futures on the daily chart this is just a very small kickback in price with really know to trend developing at this point so I still advise people to stay away from the orange juice market until a real trend develops which could be real soon. Many of the soft commodities in the last several weeks continuing to hit contract lows before this week including the orange juice market, however prices are still in trouble on the upside due to the fact that there is low demand for this product and a large harvest which increased supply causing prices to decline
Meat Futures-- The cattle markets today were slightly higher with the June live cattle trading higher by 40 points to trade at 119.75 a pound looking to break out above 122.00 which was the recent high of a couple weeks ago continuing its bullish momentum to the upside while feeder cattle prices for the August contract finished higher by 47 points to close at 159.57 a pound also continuing its bullish momentum to the upside while both charts looking very solid with good chart structure which tells me higher prices are coming in the short term in my opinion. This week China announced that they will import over 1,000,000 pounds of pork which caused the lean hogs for the July contract moving sharply higher in the last several weeks about 700 points currently trading at 93.10 down 22 points for the trading session in a lack lustre trade in Chicago blamed on profit-taking. In my opinion the hogs and the cattle markets both look bullish on the daily charts, however remember always to use stop losses if you do decide to get long these markets because they are very volatile with quick selloffs so make sure you use stop losses and a good solid money management plan to be able offset a position when you wrong minimizing risk. Traders are keeping an eye on the June 12th crop report which also could dictate cattle and hog prices due to feed costs affecting meat costs. 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.
Michael Seery, President
Seery Futures
Twitter–@seeryfutures
Phone # (800) 615-7649
There is a substantial risk of loss in futures, futures option and forex trading. Furthermore, Seery Trading is not responsible for the accuracy of the information contained on linked sites.
