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 1,201 an ounce while currently trading at 1,229 up about $28 for the trading week all based off of the Federal Reserve raising interest rates. However, stating that they will take precaution down the road sending many commodities higher while sending the U.S dollar sharply lower. At present I'm now recommending a short position from the 1,229 level and if you take that trade place your stop loss above the 10-day high which stands at 1,237 risking around $250 per mini contract or $800 on the large contract plus slippage and commission as the risk/reward are highly in your favor as the chart structure is outstanding. Gold prices hit a 6 week low earlier this week telling you that the short-term trend is lower as prices are trading right at their 20 & 100-day moving average with major support around the 1,200 level & if that is broken the bearish trend should continue in my opinion so take a shot at the short side as the monetary risk is low.
TREND: LOWER
CHART STRUCTURE: EXCELLENT

Silver Futures

Silver futures in the May contract settled last Friday in New York at 16.92 an ounce while currently trading at 17.37 up about $0.45 for the trading week all due to the fact that the Federal Reserve said they might slow down on interest rates hikes later in the year pushing the precious metals sharply higher. At present, I'm not involved in silver as I do have a short position in gold as I will wait for better chart structure to develop in this market as the chart structure is poor and the trend is mixed. Silver prices are trading right at their 20 & 100-day moving average telling you that the trend is sideways with the next major level of support around the 17 level and if that is broken you have to think that we could test the contract lows around the 16 area, but look at other markets that are beginning to trend with a better risk/reward scenario. The U.S dollar fell sharply this week as that's what helped propel the precious metals as I still think interest rates are on the rise as this look like a massive short covering rally in my opinion, however, avoid this market at the current time.
TREND: LOWER - MIXED
CHART STRUCTURE: POOR

Crude Oil Futures

Crude oil futures in the April contract settled last Friday New York at 48.49 a barrel while currently trading at 48.75 up slightly for the trading week as I've been sitting on the sidelines, but I do have a bearish bias to the downside as I think lower prices are ahead. The chart structure is relatively poor at present as the 10-day high stands at 53.80 which is way too much risk in my opinion, however I'm certainly not recommending any type of bullish position as I do think prices could retest the contract lows which was hit on November 14th, 2016 around the 45.18 level as the commodity markets look weak at present despite the fact that the U.S dollar ended the week on a negative note. Oil prices are trading right near a 14 week low trading under their 20 & 100-day average telling you that the short-term trend is lower as oversupply situations continue to hamper this market and I am looking at a short position if prices rally and the chart structure improves, therefore, lowering monetary risk as we could be short in next week's trade.
TREND: LOWER
CHART STRUCTURE: POOR

10-year Note Futures

The 10-year notes in the June contract settled last Friday in Chicago at 123-00 while now trading at 123-26 as this market reacted positively to the Federal Reserve announcement which said they will be patient at raising rates sending many sectors higher. I am currently short a position from around the 123-17 level while placing my stop loss above 123.28 on a closing basis only risking around $330 per contract plus slippage and commission as volatility in all of the commodity sectors will certainly be heightened in the coming weeks. The 10-year note is currently yielding about 2.52% hovering right at a 4 month low as the trend is lower as the only interest is in the stock market to the upside as higher interest rates are coming in my opinion so let's keep a close eye on this report.
TREND: LOWER
CHART STRUCTURE: 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.

Soybean Futures

Soybean futures in the May contract settled last Friday in Chicago at 10.06 a bushel while currently trading at 9.98 continuing its bearish momentum on a weekly basis as I have been short this market from around the 10.48 level & I also have added to the November contract as I am bearish the entire soybean complex old and new crop alike. Traders are awaiting the next USDA crop report which has estimates of 88 million acres which in my opinion could produce 4.5 billion bushels which will be another all-time record high coupled with the fact that Brazil produced another record crop as there is very little bullish fundamental news to push prices higher in my opinion so stay short. If you took the original trade place the stop loss above the 10-day high which now stands at 10.42 as the chart structure will improve on a daily basis next week, therefore, lowering monetary risk as this is one of the only few trends in the commodities at the current time. The next major level of resistance is the most recent low which occurred in Tuesdays trade at 9.92 & if that is broken I think we can head all the way down to around the 9.60 level as next week's trade will be interesting.
TREND: LOWER
CHART STRUCTURE: IMPROVING

Corn Futures

Corn futures in the May contract settled last Friday in Chicago at 3.64 a bushel while currently trading at 3.64 unchanged for the trading week with very little volatility as I've been recommending a short position from around the 3.80 level and if you took that trade the 10-day stop has now been lowered to 3.80 and will improve on a daily basis next week, therefore, lowering monetary risk. Corn prices are still trading below their 20 and 100-day moving average telling you the short-term trend is lower with the next major level of support at 3.60 as traders are awaiting the next USDA crop report which comes out in 2 weeks which will state perspective planting which is estimated around 90 million acres which is 4 million acres less than what was planted in 2016. Volatility in corn certainly will start to expand as we enter spring planting in the next month as this will become a weather market as I'm also recommending a short position in soybeans while getting stopped out of the oat market earlier in the week as I remain short corn as the trend is lower.
TREND: LOWER
CHART STRUCTURE: IMPROVING

Cocoa Futures

Cocoa futures in the May contract settled last Friday at 1934 while currently trading at 2020 up about 85 points for the trading week having one of its strongest weeks in months as it looks to me that prices are bottoming out as I've been on the sidelines in this market, but if you were short a futures position it is time to move on as prices are right near a 6 week high. Cocoa prices are trading lower for the 3rd consecutive day as I'm looking at entering into a bullish position, however the 10-day low stands at 1878 as the risk is too high & does not meet my criteria to enter as I will keep a close eye on this market as a possible bottoming pattern is at hand in my opinion. Prices are now trading above their 20-day moving average for the 1st time in months, but still under their 100-day telling you that the short-term trend is mixed as I currently do not have any recommendations in the soft commodities as there are very few trends in the commodity world at present.
TREND: MIXED - LOWER
CHART STRUCTURE: IMPROVING

Sugar Futures

Sugar futures in the May contract settled last Friday in New York at 18.22 a pound while currently trading at 17.62 down about 60 points for the trading week ending on a sour note down over 60 points in today's trading session as I've been sitting on the sidelines as I missed this trade to the downside, however as I've written about in previous blogs I think prices are headed lower. Sugar prices hit lows that we have not seen since June 2016 with the next major level support all the way down at the 16.00 level as there is more room to run to the downside in my opinion as the soft commodities still look weak as I'm certainly not recommending any type of bullish position as this trend is getting stronger to the downside on a weekly basis. The chart structure at present is very poor because prices have dropped rather dramatically over the last several weeks topping out around the 21 level if you are short a futures contract stay short in my opinion & place the stop loss above the 10-day high which now stands at 19.84. However, the chart structure will improve every day in next week's trade, therefore, lowering the monetary risk.
TREND: LOWER
CHART STRUCTURE: IMPROVING

Wheat Futures

Wheat futures in the May contract settled last Friday in Chicago at 4.40 a bushel while currently trading at 4.36 down slightly for the trading week as I am currently sitting on the sidelines waiting for the chart structure to develop as prices are still right near a 6 week low. The next level of support is around 4.30 as this market has remained choppy over the last 6 months as I'm currently recommending a short position in corn and soybeans as traders are awaiting the next USDA crop report with estimates of the lowest planting possibility since 1919 & even that bullish news does not propel prices higher as that just tells you how fundamentally weak the wheat market is at the present time. The grain market, in general, will start to enter the volatile spring and summer months as this volatility will not continue to remain this low for much longer as there are very few trends at present so avoid this market as we might not be involved until the month of April.
TREND: MIXED
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.