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-- Precious metals in New York this week had a wild ride to the downside with gold finishing up $1 an ounce this Friday afternoon at 1,393 and was up nearly $30 in early trade just to selloff near session lows and during the week sold off about $105 dollars since last Friday settling at 1,501 and traded as low as 1,335 hitting a new 2 year low and as I’ve been advising in previous blogs I remain very bearish the precious metals sector, however I do believe that the easy money has been made and you could chop around here for next couple of weeks due to the fact of such a dramatic selloff which was the worst selloff since 1983 as investors see no reason to own gold at this point in time despite the fact of easy monetary policies throughout the world. Copper futures for the July contract down another 600 points today trading below its 20 and 100 day moving average settling last Friday at 3.37 while currently trading at 3.14 a pound near 2 ½ year low as I’ve been stating in many previous blogs I think it will retest 3.00 a pound possibly next week and if that level is broken you could head down to 2.75 as record inventories could keep pressure on this commodity also with waning demand from China which is pushing prices lower. Silver futures for the July contract were down about $.25 at 23.00 an ounce also hitting new 2 ½ year low settling last Friday at 26.40 down over $3 for the week and actually traded as low as 21.12 on Tuesday before short covering pushed prices back up to today’s level ,however I remain very bearish silver prices because I do think there’s a possibility that silver can head back down $18 here in the next couple of months but there could be some choppiness in the next couple of weeks because the fact that we went down so quickly. All of the precious metals are trading below their 20 &100 day moving average, however they are all have very poor chart structure at this point because of the huge decline so volatility is going to be sky-high in this sector for the next couple of weeks so if you are looking to trade precious metals make sure you have a stop loss to try & minimize your risk to 1% or 2% of your account portfolio. TREND: LOWER –CHART STRUCTURE: EXCELLENT
Energy Futures--- The energy market continued their onslaught to the downside this week with crude oil finishing up 20 cents a barrel at 87.90 and as I’ve been recommending in many previous blogs I think the energy sector is outrageously overpriced especially in crude oil with 23 year high inventory levels & waning demand and deflation across the globe especially in China pushing prices sharply lower once again and I do believe that crude oil will be trading at $75 a barrel within the next couple of weeks in my opinion. Unleaded gasoline which continues to go down on a daily basis rallied slightly today by 150 points at 2.77 a gallon with the next major support at 2.50 which is still quite a distance away and I still believe we are headed to those levels. Heating oil finished higher by 100 points in the May contract at 2.79 a gallon and if anybody has been listening to me in previous blogs I am extremely bearish heating oil as we enter the summer months with huge supplies going into summer when heating oil demand is at its lowest with a general malaise in the commodity markets as investors are fearing prices could head much lower remembering the fact that these prices are still elevated over the 10 year average. In my opinion I’m still recommending short positions in every single commodity especially in crude oil because I believe there is significant downside to this sector as all of the components of the energy sector are trading far below their 20 and 100 day moving average which is always a bearish indicator in my opinion as well as lower prices for grains and metals and generally most of the soft markets as well are in a deflationary period. Remember you when you trade commodities you will be wrong sometimes so you must put a stop loss and not marry your position because never getting out causes exaggerated monetary losses so always risk between 1-2% of your account balance on any given trade trying to minimize risk. TREND: LOWER –CHART STRUCTURE: EXCELLENT
Grain Futures-- Grain futures in Chicago finished mixed with November soybeans which is considered the new crop trading down by $.10 at 12.13 closing right at session lows after settling last Friday at 12.32 a bushel hitting a 10 month low still trading below its 20 and 100 day moving average as adequate rain is hitting the Midwest on a daily basis and as I’ve stated in many previous blogs I still believe November beans are ridiculously high-priced with a record crop possibly coming in at this point in time. Corn futures for the December contract which is considered the new crop are trading above the 20 day moving average up about $.06 this Friday afternoon at 5.48 a bushel right near a 3 week high on concerns that only 2% of the crop is planted far below the 5 year average still trading far below their 100 day moving average which stands at 5.79 a bushel after settling last Friday at 5.50 a bushel basically unchanged for the week. Corn was not under pressure this week due to the fact that we are having floods in many parts of the Midwest which could impact planting because corn is currently being planted and if farmers are not able to get it in the ground they will shift to soybeans and that is why you see November soybeans continue to head lower. December wheat is trading above their 20 day moving average but below their 100 day moving average which stands at 7.86 climbing higher once again today also due to the fact that excessive rain throughout the Midwest is causing concerns right near a 2 week high looking to break out possibly next week if the weather continues to be a problem. I have seen many grain markets in my trading years and if the rain does not continue I think you should still take advantage of rising prices in corn and wheat and be short the entire sector including the November soybeans which I do believe could head down to the $10 level right where we were in July 2010 due to the fact that the carryover could explode with the record crop coming in this October. The commodity markets in general are starting to break down with many of them hitting two-year lows this week and I do believe that this trend will continue at least here in the short term so I’m still recommending shorts across the board in every single commodity including the grain market. TREND: LOWER –CHART STRUCTURE: EXCELLENT
Japanese Yen-- The Japanese Yen continues to plummet today for the 4th consecutive trading session as the Japanese government is determined to lower the value of their currency with massive quantitative easing trading lower by 160 points in the June contract currently at 10040 trading way below its 20 & 100 day moving average and in my opinion is headed much lower from these levels. Major support for the Yen is between 99 – 100 which is right at 4 year lows and if that level is broken and in my opinion I do believe it will be broken you could head all the way back down to August 2008 lows of around 90 and that is exactly what the Japanese government is trying to do so I would definitely not step in front of this falling knife because lower prices in my opinion are ahead. There are some analysts the traders that I’ve been listening to that are concerned that the Yen could collapse meaning if the price to drops to quickly in such a short period of time that could cause unrest in many other markets and it’s definitely hurting the commodity markets at this point in time. My advice to traders as it has been for several months is to remain short this market remembering always put a stop loss in case the tide does turn but at this point this trend is incredibly strong with excellent chart structure to the downside. TREND: LOWER –CHART STRUCTURE: EXCELLENT
Natural Gas--Natural gas futures were higher by 20 points in the May contract yesterday but up only 1 point today trading higher for the 4th straight trading session currently trading at 4.41 hitting a 1 ½ year high still trading above its 20 & 100 day moving average. In my opinion as I've stated in previous blogs I am extremely bullish natural gas because I do believe that the United States government is going to mandate natural gas for many different uses therefore propelling demand up in the next 3 to 5 years tremendously in my opinion. If you look back on the weekly chart natural gas bottomed on 4/23/12 at 192 and is slowly crept up in the last 10 months with a possible bottom right around 3.20 which has been hit 5 different times and rallied each time and as I've stated before I believe in a couple years down the road you're going to see natural gas prices at $8-$9 level with people shaking their heads wondering where were they when these prices were at ridiculously low levels. If you're looking to invest in natural gas I would look at buying a futures contract for possibly the November or December delivery and if you're longer-term investor you hold for a long period of time hoping that demand will increase and that your investment gains value over a several year period. TREND: HIGHER -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.
Michael Seery, President
Seery Futures
Twitter–@seeryfutures
Phone # (800) 615-7649
