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 1,226 an ounce while currently trading at 1,204 continuing its bearish momentum right near a 6-week low as the precious metals continue to move lower on a daily basis due to a strong U.S dollar. At the current time I have no trade recommendations in the precious metal sector as it looks to me that gold might even possibly retest the contract low around 1,150, but avoid this market at present & look at other trades that are beginning to trend with a better risk/reward scenario. Gold prices are now trading under their 20 and 100-day moving average telling you that the short-term trend is lower as crude oil prices have also broken out of a tight consolidation which is another negative towards all commodity prices in my opinion. The U.S stock market is higher across the board today as the monthly unemployment number came in as the United States added around 235,000 new jobs as all the interest lies in the S&P 500 & not in gold at the current time.
TREND: LOWER
CHART STRUCTURE: POOR

Silver Futures

Silver futures in the May contract settled last Friday in New York at 17.74 an ounce while currently trading at 17.02 down over $0.70 for the trading week as prices have hit a 6-week low trading lower for the 4th straight day. I was recommending a bullish position in silver for around two months getting stopped out in last week's trade which I considered very disappointing. However, prices have dropped much further as that is why you must have an exit strategy because you don't know how high or low prices can go as the precious metals, in general, have fallen out of bed. Silver prices are now trading under their 20 & 100-day moving average telling you the short term trend is lower as the contract low is around the $16 mark which was hit in December 2016 and it looks to me that prices might head down to that level, however, avoid this market at present as the chart structure is terrible therefore the monetary risk is too high. At present, I do not have any trade recommendations in the precious metals as my main focus is in the grain market to the downside as the commodities look weak in my opinion due to a strong U.S dollar.
TREND: LOWER
CHART STRUCTURE: POOR

Crude Oil Futures

Crude oil futures in the April contract are currently trading at 49.50 a barrel after settling last Friday in New York at 53.33 down nearly $4 for the trading week near a 14 week low as the true breakout was below 51.86. However, I am not involved in this market as I'm waiting for some type of price rally to enter into a short position, therefore, lowering the monetary risk. If you are short this market I would place my stop loss above the 10-day high which stands at 54.44 as the chart structure is very poor because prices absolutely collapsed over the last several days having its worst one-day performance in over 11 months. Prices are now trading below their 20 and 100-day moving average telling you that the short-term trend is lower as massive supplies continue to put a lid on this market coupled with the fact of a strong U.S dollar as the commodities, in general, look weak across the board, but wait for some type of price rally before entering, but I'm certainly not recommending any type of bullish position as I think lower prices are ahead.
TREND: LOWER
CHART STRUCTURE: POOR

Wheat Futures

Wheat futures in the May contract settled last Friday in Chicago at 4.53 a bushel while currently trading at 4.45 down about 8 cents for the trading week reacting pretty neutral to yesterday's USDA crop report lowering carryover levels by about 10 million bushels as the grain market still looks weak in my opinion. At present, I'm not involved in wheat as I am short oats, corn, and soybeans as I do think the whole complex is headed lower. However, wheat prices are still near a 4-week low with poor chart structure, so I probably will not be involved in this market for some time. The next major level of support is 4.38, and if that is broken, I think we will join the rest of the grains to the downside as we are now trading under the 20 and 100-day moving average telling you that short-term trend is lower. The U.S dollar is still hovering right near a 7-week high around the 102 level as that has finally put some pressure on many of the commodity sectors which have been rallying until the last week or so, but wheat has remained choppy for months so avoid this market & look at other trades with better potential.
TREND: MIXED - LOWER
CHART STRUCTURE: POOR

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.

Lean hog Futures

The tide has turned in many of the commodity sectors as I've been stating for several months that I do believe commodity prices are headed higher in the long run, but the trend has changed to the downside as now prices look very weak due to the relentless U.S dollar to the upside. I have been recommending a short position in the lean hog June contract from around the 77.75 level and if you took that trade continue to place your stop loss above the 10-day high which stands at 78.87 over the next 7 days so you will have to accept the monetary risk at this point as the chart structure is excellent therefore the monetary risk has been lowered. Prices are trading right at their 20 and 100-day moving average as it looks to me that a major breakout could occur as the commodities, in general, are very weak as I have several short recommendations especially in the grain markets and if you have not taken the trade I'm still recommending at this time as the chart structure is outstanding and the risk/reward are still in your favor so continue to play this lower. If the commodity markets continue to move lower, the livestock sector will join the party eventually as hog & cattle prices have been relentless to the upside in 2017 so keep a close eye on this sector as they look to be topping out in my opinion.
TREND: LOWER - MIXED
CHART STRUCTURE: EXCELLENT

Corn Futures

Corn futures in the May contract settled last Friday in Chicago at 3.80 a bushel while currently trading at 3.63 lower for the 5th consecutive session as I've been recommending a short position from around the 3.80 level and if you took the trade continue to place your stop loss above the 10-day high standing at 3.86 as the chart structure is poor due to the fact that prices have fallen rather quickly. Prices reacted negatively to the USDA crop report yesterday as there is very little fresh fundamental news to push prices higher in corn and the rest of the grains in my opinion as prices are still trading below their 20 and 100-day moving average hitting a 6 week low so continue to stay short while placing the proper stop loss. The next major report comes out in a couple of weeks when the USDA reports estimated acres which are assumed to be around 90 million which is 4 million less than in 2016 as most likely we will not produce a record crop, however the commodity markets in general and especially the agricultural markets look very weak as the trends are lower so stay short.
TREND: LOWER
CHART STRUCTURE: POOR

Cocoa Futures

Cocoa futures in the May contract settled last Friday at 19.55 while currently trading at 19.23 continuing its bearish momentum still right near a 9 year low, however prices might be bottoming out as the chart structure is outstanding at present as the 10-day high now stands at 19.81 as prices basically have gone sideways over the last 4 weeks. At the current time I'm not involved in the cocoa market as prices have been in free-fall over the last 6 months and historically speaking looks cheap as it looks to me that a possible bottoming formation could be developing, but I will wait for the true breakout to occur before entering into a bullish position as this trend remains negative. Cocoa prices are trading far below their 20 and 100-day moving average telling you the short-term trend is lower as prices have dropped about 1000 points over the last 6 months as higher production out of the Ivory Coast of West Africa coupled with lower demand continuing to put pressure on this market so keep a close eye on a possible bottoming pattern.
TREND: LOWER
CHART STRUCTURE: EXCELLENT

Sugar Futures

Sugar futures in the May contract settled last Friday in New York at 19.52 a pound while currently trading at 18.13 looking to retest the contract low which was hit in December 2016 and if that is broken you could head all the way down to the February 2016 low around 12.50 as this market remains very bearish. At present I am not involved as the chart structure did not meet my criteria when the original breakout occurred, however I do think lower prices are ahead and if you do have a short position place your stop loss above the 10-day high which now stands at 19.80 and will not improve for another 5 trading sessions, so you will have to accept the monetary risk. The commodity markets, in general, look very weak as the U.S dollar despite selling off this Friday afternoon continues to hamper commodity prices and especially the agricultural markets as I'm certainly not recommending any type of bullish position in sugar as the momentum is getting stronger on a daily basis. Sugar prices are trading below their 20 and 100-day moving average is telling you that the short-term trend is lower and expect to see stop some stops below that level as the large funds will add to their short positions in my opinion.
TREND: LOWER
CHART STRUCTURE: POOR

Soybean Futures

Soybean futures in the May contract settled last Friday in Chicago at 10.37 a bushel while currently trading at 10.04 as I have been recommending a bearish position from around the 10.48 level & if you took that trade continue to place your stop loss above the 10-day high at 10.57 as the chart structure is terrible at present as prices continue to head lower. Prices reacted negatively to the USDA crop report which was released yesterday adding another 15 million bushels to the carryover levels which are ready historically high as traders are awaiting the next USDA crop report which comes out in a couple of weeks & state estimated acres which will be planted in 2017 as the estimate is around 88 million which would be another all-time high. Soybean prices are trading under their 20 and 100-day moving averages as I'm now recommending a bearish position in the November contract which is considered the new crop & will be harvested this autumn as this trend seems to be getting stronger on a daily basis so remain short while risking 2% of the account balance on any given trade.
TREND: LOWER
CHART STRUCTURE: POOR

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.