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.
Precious Metal Futures--- The precious metals this week had extreme volatility across the board with gold higher 4 out of the last 5 trading sessions trading up another $5 coming off of session highs on profit taking currently trading at 1,732 an ounce rallying nearly $60 dollars in 5 days as a flight to quality has happened with the stock market falling out of bed this week as investors are flocking into gold as well as the United States treasuries. Gold futures for the December contract are higher than their 20 and 100 day moving average at this point right at a two-week high just after hitting a two month low last Friday as traders pour into the precious metal once again continuing its long-term bull market and short term choppiness while silver futures were also up 4 of the last 5 trading days and at a two-week high today after nearly hitting a two month low last Friday afternoon finishing down about $.95 and is now trading above the 20 day moving average which was 32.11 currently up $.40 today at 32.60 an ounce in a sideways to choppy market and in my opinion I thought silver futures were headed lower due to the fact of slower demand but gold prices continue to push up silver prices at this point in time so I have no recommendation for silver or gold. Copper futures which I have been very bearish in all my previous blogs and still remain very bearish with copper down another 300 points at 344.30 a pound right at two-month lows hitting major support while still trading far below its 20 and 100 day moving average on economic worries overseas curbing demand which is pushing copper prices near support at this point in time. Platinum futures for the January contract are near a two-month low trading at 1, 544 an ounce up around $10 an ounce this morning basically unchanged for the trading week still trading below its 20 day moving average of 1,580 but above its 100 day moving average still stuck in a sideways trend in my opinion I don’t like trading markets that go sideways so wait for a break out occurs before I enter this market on the short or long side. Volatility this week in the commodity sector especially in the precious metals been very high and I think it will continue for months to come due to so much uncertainty around the world and so much uncertainty here especially with the Obama administration basically printing more money which is sending the precious metals sharply higher despite the fact that U.S dollar was up 5 days in a row this week having no impact at all on metal prices. TREND: COPPER--LOWER –TREND: GOLD & SILVER: NEUTRAL---CHART STRUCTURE: EXCELLENT
Energy Futures---The energy futures this week saw extreme volatility across the board with crude oil right near a five month low trading $1.00 higher this afternoon in New York currently at 86.05 a barrel after last week settling at 84.86 a barrel off slightly for the week but at one point traded as high as 89.22 on Tuesdays trading session on hopes of a Romney victory pushing commodity prices sharply higher that day but since Tuesdays Obama victory prices slid back down towards major support with unleaded gasoline higher by 600 for the week as well hitting a three month low earlier yesterday but rebounding sharply currently trading at 2.688 up 800 points for the day and traded as high as 271.50 earlier this week looking at bottoming at these levels, however I’m still bearish the energy sector I do believe we have ample supply and waning demand and in my opinion prices are headed lower with heating oil prices today are higher as well by 450 points at 2.99 a gallon up about 400 points for the week and traded as high as 306.50 still near a three month low still trading below its 20 day moving average but above its 100 day moving average which tells me there could be some sideways and choppy action here in the near future, however in my opinion I’m still bearish heating oil prices while prices have been pushed up due to cold-weather out East, however these are historically very high prices and I still believe that commodity prices and stock market prices head lower. I think traders will start to focus on Iran once again after the holidays which could put a floor under prices here in the short term. TREND: LOWER –CHART STRUCTURE: EXCELLENT
Grain Futures--- Corn production is forecast at 10.7 billion bushels, up slightly from the October forecast but down 13 percent from 2011. This represents the lowest production in the United States since 2006. Based on conditions as of November 1, yields are expected to average 122.3 bushels per acre, up 0.3 bushel from the October forecast but 24.9 bushels below the 2011 average.
If realized, this will be the lowest average yield since 1995. Area harvested for grain is forecast at 87.7 million acres, unchanged from the October forecast and up 4 percent from 2011. Corn futures for the December contract are lower by 2 cents a bushel currently trading at 7.40 still stuck in a choppy and sideways pattern with no trend in sight.
Soybean production is forecast at 2.97 billion bushels, up 4 percent from October but down 4 percent from last year. Based on November 1 conditions, yields are expected to average 39.3 bushels per acre, up 1.5 bushels from last month but down 2.6 bushels from last year. Compared with last month, yield forecasts are higher or unchanged across all States except for Oklahoma and Texas. Area for harvest in the United States is forecast at 75.7 million acres, unchanged from October and up 3 percent from last year. Soybean futures for the January contract were lower by 44 cents closing the gap that happened during the summer months continuing its bearish trend trading at 14.51 with major support at 14.50 and in my opinion prices are headed lower. TREND: LOWER –CHART STRUCTURE: EXCELLENT
Stock Futures---The stock market this week finally saw some extreme volatility with the U.S presidential election sending prices up sharply earlier in the week on rumors of a Romney victory only to sell off dramatically after Obama was reelected with the S&P 500 crossing below its 20 and 100 day moving average today but reversing sharply up about 4 points at 1379 at the time I wrote this article reversing a 10 point loss earlier in the morning right at a 3 month low also pushing the Dow Jones industrial higher today by 5 points at 12, 778 down 190 points from the start of the week right also in a three-month low and in my opinion I believe today is a kickback and I do think stock prices are too high at this point in time and I believe they will have at least a 10% correction and at this point we’ve only had about a 6% correction from the highs. Nasdaq futures for the December contract also crossed below the 20 and 100 day moving average trading at 2586 up about 15 points today but sharply lower for the trading week and has been the weakest sector in the stock futures due to the fact that Apple Computer has dropped 20% in the last month pushing many other tech companies lower .Many commodities including the stock market were lower earlier in the session only to rebound sharply on massive short covering as well as possible oversold conditions, however in my opinion I think it’s just a kick back and I’ve been following the stock market for many years when you get three or four severe down days which happened this week the market gets a kick back with bottom feeders or bargain hunters stepping in and buying at lower levels. Earlier in the week there were main concerns about the fiscal cliff not being met, however I do think Congress will address the situation but I don’t think they will address it until the last possible week which will still send shockwaves through the commodity and stock markets in the next month. TREND: LOWER –CHART STRUCTURE: EXCELLENT
Coffee Futures--- Coffee futures for the week continue their massive grinding bear market hitting lows that we have not seen in over 2 years down around 500 points for the week and on this Friday afternoon finishing right near session lows down another 150 points at 149.90 in the December contract with the next major support at 140- 145 which in my opinion I think it will hit their next week due to the fact that there’s very little demand for this product with solid surplus and a record harvest coming in keeping a lid on coffee prices at this time. As I’ve stated in many previous blogs I’m still bearish coffee prices and I think they will head lower, however if prices get into the 130’s-140s I would have to start to take some profits off of the table because if you look at historical prices they are still relatively high over the last five years but if we get down to those levels there is major support and a possible buying opportunity. Coffee volatility at this point is very low basically selling off 100 or so points and in my opinion volatility will get much higher from these levels in the next couple of months and that volatility should be to the upside but remember to always place a stop loss if you are short the coffee market and if you look back at the daily chart in June we rallied over 2000 points in 3 days and that could happen again on massive short covering or any bullish news so make sure you stops to minimize any monetary loss or to capture some profits. As I’ve stated in many blogs I am bearish the commodity sector along with the stock market but when prices hit a certain level I will start to change my mind but at this point I still remain bearish due to the uncertainty of the fiscal cliff looming ahead. TREND: LOWER –CHART STRUCTURE: EXCELLENT
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
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.
Orange Juice Futures--- Orange juice futures in New York today settled lower again by 200 points at 107.45 for the trading session continuing an extremely bearish trend still hovering right near the 52-week low which happened on August 15th of this year at 105.05 and is only about 3.50% from hitting that level on extremely light volume this afternoon due to Hurricane Sandy. Orange juice prices are far from their highs which were hit on January 10th earlier this year at 196.10 all due to the fact that hurricane season was non-existent therefore creating an abundant harvest putting supply pressure on the market, however in my opinion with major support at 105 I believe orange juice prices are becoming relatively cheap going into the freeze or winter season which usually means traders put a price premium just in case of a damaged crop. Orange juice futures are not real liquid meaning they don’t do a lot of volume but that doesn’t mean you can’t trade the market you just have to be careful and make sure you use a stop loss trying to limit your risk because there is always risk when you place any trade in any commodity. I would sit on the side-lines and wait and see if orange juice prices come near that 105 level and then from there take a serious look at the upside because I do believe there is potential to start a fall rally. The 100 day moving average in the January orange juice is at 116.15 so we are 900 points lower which generally is a negative sign that is stating the trend should continue so I do expect prices to retest at 105 in the next couple of days. TREND: LOWER CHART STRUCTURE: EXCELLENT
Milk Futures--- Milk futures here in Chicago finished at 19.46 crossing below its 20 day moving average and 100 day moving for the first time in months and if you look at the daily chart it has terrific chart structure and in my opinion the chart is looking more like a seasonal top, however its only 6% from contract highs while last week stayed unchanged before Wednesdays break out to the downside despite a remarkable run in the last 4 months which is up about 27% from contract lows on production being cut due to the Midwestern drought. Milk prices bottomed on the weekly chart right around the 15 level last May and in my opinion I think prices are too high and will start to decline in the next couple of months. There was major support in the December contract right around 19.80 which was broker easily today with the next support right around 19.20 with major resistance right at contract highs of 20.90 with today’s crop production report being neutral with no new fundamental information at this time with traders trading this market on a technical basis. Milk futures are not real liquid meaning they don’t do a lot of volume but that doesn’t mean you can’t trade the market you just have to be careful and make sure you use a stop loss trying to limit your risk because there is always risk when you place any trade in any commodity. TREND:LOWER ---CHART STRUCTURE: EXCELLENT
Livestock Futures---Livestock futures this afternoon in Chicago were mixed with live cattle for the December contract finishing higher by 25 points at 125.65 a pound remaining under its 20 day and its 100 day moving average and in my opinion still pointing to lower live cattle prices. Live cattle prices are still about 500 points from its contract low which happened on April 27, 2012 at 1.20 and in my opinion I believe prices will retest those levels in the next coming weeks. Feeder cattle prices were slightly lower by 32 points currently trading 145.50 a pound hitting a fresh 4 month low with major resistance at 151.25, however still very far away from the contract highs on May 21st 2012 at 164.30 before the U.S drought took its toll on corn prices sending cattle prices sharply lower. The 20 day moving average in the January feeder cattle is 148.50 and the 100 day average is 149.80 which are still only 400 points from today’s levels which are bearish indicators in my opinion with further declines in price coming. At this point in time the feeder cattle market has the best trend to the downside so if you are going to short a futures contract while placing a stop above recent highs of around 151 which is risking around $3,000 per contract. Lean hog futures for the February contract were up 40 points today at 86.45 a pound still hanging around recent highs due to the fact that the hog herd historically is very small and if you look at the back months in hog prices they are at all-time highs. Hog prices are above the 20 and 100 day moving averages telling me that higher prices are coming in the February contract so I’m advising traders to take advantage of any type of dip in this market and try to establish long positions remembering to always place a stop loss trying to minimize monetary losses. TREND: CATTLE—LOWER -- CHART STRUCTURE—FEEDER CATTLE--EXCELLENT
Currency Futures--- The Euro currency is trading slightly lower this afternoon finishing down nearly 30 points in the trading session in an extremely nonvolatile trading week which was a surprise because all of the other markets had big price swings with the Euro currency below its 20 day moving average now looking towards 100 day moving average at 1.2630 with major support at 1.27 and if that level breaks in my opinion I think we are headed sharply lower from these levels. The Canadian dollar has broken par down another 5 points at 9994 well below its 20 day moving average and now below its 100 day moving average which was at 9995 signaling further weakness in the coming weeks. The Canadian dollars is at a fresh three-month low after peaking during the QE3 nonsense which was trading above 1.0350 now grinding lower with very solid chart structure and I’m recommending all traders to be long the U.S dollar and short all of the foreign currencies including the Canadian dollar. The U.S dollar index today was up 20 points breaking out to a 7 week high at 81.08 and now the daily chart it looks like a possible double bottom has been formed and I have stated in many previous blogs I am bullish the U.S dollar and bearish the other currencies so if you are looking at taking a shot buying the U.S dollar my advice is to buy the futures contract and place a stop below the recent low which was right at 79.00 risking around $2,000 per contract. The Mexican Peso which generally follows the S&P 500 has been weakening in recent weeks down again today by another 22 points breaking below its 20 day moving average and now looking at its 100 day moving average which is at 7495 currently trading at 7557 hitting a fresh 7 week low and in my opinion has topped out also during the announcement of QE3 and I’m advising traders to go short the Mexican Peso placing a stop above the recent highs of 7825 risking around $1,300 per contract. In my opinion I believe all of the gains that were created by QE3 will be erased in the commodity and currency markets because I don’t believe it will have as much impact as everybody first thought. 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
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.
Michael Seery, President
Seery Futures
Twitter–@seeryfutures
Phone # (800) 615-7649
I have to write an essay for the beginning of school about my goals for the future, and details on how you plan to achieve them.