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.

Crude Oil Futures

Crude oil futures in the June contract are up 60 cents this Friday afternoon in New York currently trading at 46.10 a barrel breaking the low that was hit on March 27th at 47.63 this week. I think prices could re-test the November low around the $42 level as the trend remains to the downside. Crude oil prices are trading under their 20 and 100-day moving average as the precious metals & the entire energy sector continue to be under pressure over the last several weeks. My only recommendation is a short natural gas position. The chart structure in crude oil is not that great, and I will wait for the monetary risk to be lowered. I'm certainly not advising any type of bullish position as this markets trend is negative and coupled with the fact of very poor fundamentals as worldwide supplies are massive as now the problem could be waning demand. Oil prices traded above $53 in mid April as prices have now dropped about $7 a barrel rather quickly, so let's keep a close eye on this market for a possible short position in the coming days ahead.
TREND: LOWER
CHART STRUCTURE: POOR

Gold Futures

Gold futures in the June contract are unchanged this Friday afternoon in New York currently trading at 1,228 an ounce after settling last week at 1,268 down about $60 and continuing its bearish momentum. I was looking at a short position. However, I did not take the trade as the chart structure and the risk did not meet my criteria to enter into a trade. I'm certainly not recommending any type of bullish position as I still think lower prices are ahead. Gold futures have now hit a 7-week low trading under their 20 and 100-day moving average. I will look for some type of price rally before entering a short position as the next major level of support is all the way down to the 1,200 level with silver and platinum hitting recent lows helping to put pressure on gold prices. If the 1,200 level is broken we could retest the contract lows that were hit on December 15th 2016 at the 1,130 level. I see no reason to own gold at present as the stock market continues to move higher on a weekly basis as that's where all the action is at the moment.
TREND: LOWER - MIXED
CHART STRUCTURE: SOLID - IMPROVING

Silver Futures

Silver futures in the July contract settled last Friday in New York at 17.26 while currently trading at 16.33 an ounce. It's down nearly $1 for the trading week and selling off about $2.40 since the April 17th high around 18.72. That was a 5 month high and prices have just absolutely fallen out of bed. I have not been involved in silver for several months as the chart structure is terrible at the present time therefore the monetary risk does not meet my criteria, and it looks to me that prices could retest the December 23rd low around 15.84. Prices are trading far below their 20 and 100-day moving average telling you the short-term trend is lower as money flows are coming out of the precious metals and into the equity markets. The volatility in silver and many of the other commodity sectors is starting to rise as we enter the volatile summer season. I'm not involved in any precious metals at the current time as I was stopped out of copper earlier in the week.
TREND: HIGHER
CHART STRUCTURE: POOR

10-year Note Futures

The 10-year note in the June contract settled last Friday in Chicago at 125.09 while currently trading at 125.04 down 5 points for the trading week in a very non-volatile trading manner as I'm looking at a possible short position as prices are right near a 3 week low. The 10-year note is now trading below its 20 and 100-day moving average telling you that the shorter term trend is to the downside. In my opinion, prices topped on April 18th around the 126/13 level right when gold prices were near their recent highs. At the same time, a flight to quality buying was taking place pushing prices to multi month highs. The stock market continues its bullish trend as money flows are coming out of the precious metals and the bond market once again & back into the stock exchange. I think that trend will continue so keep a close eye on this market as the chart structure is excellent as prices have gone sideways over the last several weeks.
TREND: LOWER - MIXED
CHART STRUCTURE: EXCELLENT

Nasdaq 100 Futures

The NASDAQ 100 in the June contract settled last Friday in Chicago at 5580 while currently trading at 5637 up nearly 60 points and continuing to hit record highs on a weekly basis. I'm not involved in this market, but I am bullish and I do think prices are headed higher. If you're long a futures contract, I would place the stop-loss under the 10-day low standing at 5471 as the risk is still about $3,300 per mini contract plus slippage & commission, but I'm certainly not recommending any type of short position as this market has good momentum to the upside. Obamacare looks to be on its last legs with the House of Representatives passing phase 1 of the new healthcare bill which is also bullish this market. I think that the Dow Jones and the S&P 500 will soon follow, but the tech industry is on fire with outstanding earnings almost across the board with Google and Amazon continuing to propel this market higher. The NASDAQ is trading far above it's 20 and 100-day moving average telling you that the short-term trend is higher. Low-interest rates and great optimism about future growth in the United States continue to push prices higher.
TREND: HIGHER
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.

Cotton Futures

Cotton futures in the July contract are currently trading at 78.30 after settling last Friday in New York at 78.87 down slightly for the trading week still stuck in a sideways consolidation over the last several weeks waiting for the next USDA crop report which will be released next week & certainly will send more volatility back into this market. At the present time, cotton is trading above its 20-day and above the 100-day moving average which stands at 76.38 as there's very little fresh fundamental news to push prices in either direction. I am currently sitting on the sidelines in this market as the chart structure is starting to improve. We could be involved relatively soon and if you take a look at the December contract, which is considered the new crop prices have been in a 3-week consolidation between 74/75 as prices right now are trading at 74.20 and unable to break the major resistance at the 75 level. Many of the commodity markets took it on the chin this week as the precious metals & the energy complex continue to lead things lower, but cotton is now a weather market with planting in full swing in the southern part of the United States.
TREND: HIGHER - MIXED
CHART STRUCTURE: SOLID - IMPROVING

Corn Futures

Corn futures in the December contract settled last Friday in Chicago at 3.85 a bushel while currently trading at 3.89 up about 4 cents in a wild and volatile trading week. I think this is terrific to see as spring planting is in full swing in the Midwestern part of the United States and volatility will certainly increase on a daily basis. I am currently not involved in this market because I'm looking at a possible bullish position in soybeans and in corn if prices break the critical 3.96 level which is just an eyelash away. The chart structure is excellent at the present time as prices have gone nowhere for several months. Prices are now trading above their 20-day, but still below their 100-day moving average as the short-term trend is mixed. The interesting fact is that money managed funds are short almost 200,000 contracts, and that could really add some fuel to the fire to the upside. Short covering certainly could occur on any type of bullish weather situation or fundamental news such as demand, especially coming back from China so keep an eye on this market as we could be involved in next week's trade.
TREND: MIXED
CHART STRUCTURE: EXCELLENT

Wheat Futures

Wheat futures in the July contract is currently trading at 4.42 a bushel after settling last Friday in Chicago at 4.32. I was recommending a bearish position from that level getting stopped out in Monday's trade around the 4.47 level as prices skyrocketed on weather conditions over the past weekend that possibly damaged the crop in Kansas. Extremely cold weather entered the Midwestern part of the United States over the weekend sending many of the grain markets higher, and we certainly see the volatility come to life, and that will even increase over the next couple of months. At the present time, I am sitting on the sidelines as the chart structure is terrible as wheat remains extremely choppy now trading above its 20-day, but still slightly below its 100-day moving average. I do not have any grain recommendations on at the present time. Wheat prices traded as high as 4.61 earlier in the week as wheat is in a weather market as well as the rest of the grain sector and traders will be keeping an eye on the next USDA crop report which is released next week. So make sure if you are involved in this market risk 2% of your account balance as volatility can get crazy with high risk during the growing season.
TREND: HIGHER - MIXED
CHART STRUCTURE: POOR

Sugar Futures

Sugar futures in the July contract is currently trading at 15.47 a pound after settling last Friday in New York at 16.13, down over 60 points for the trading week hitting a fresh contract low in yesterdays trade at the 15.28 level and prices still look weak in my opinion. Sugar prices are trading under their 20 and 100-day moving averages, and that has been the case for the last 3 months. There is still room to run to the downside in my opinion and even though I'm not involved I have stated on multiple occasions I think lower prices are ahead. If you are short a futures contract I would place the stop-loss at the 10-day high which has now been significantly lowered to the 16.49 level, however the chart structure and the monetary risk will remain the same for 7 more trading sessions. The next major level of support is around the 14.50 level & as I've talked about many times, I think there's a possibility sugar prices could go down and retest multi-year lows around 12.50 as anything grown in the country of Brazil continues to move lower such as orange juice, coffee, and sugar.
TREND: LOWER
CHART STRUCTURE: SOLID

Soybean Futures

Soybean futures in the November contract, which is considered the new crop that is currently being planted in the Midwestern part of the United States settled last Friday in Chicago at 9.53 a bushel while currently trading at 9.72. I will be recommending a bullish futures position if prices are above 9.72 near the closing bell while then placing the stop-loss under the 10-day low which stands at 9.49 risking around $0.23 or $1,200 per contract plus slippage and commission. Soybean prices are right near a 5-week high as the chart structure is outstanding in my opinion. Volatility will start to expand tremendously in the coming weeks. My theory is any time you can risk around $0.23 in soybeans during the spring and summer months you must take that trade as weather can send prices sharply higher or lower. If you are taking a little more risk on this trade, I would possibly place the stop-loss under the April 11th low of 9.41 risking about 8 more cents or $400 per contract. That will depend on the size of your trading account while still making sure you risk only 2% of the account balance on any given trade. Traders are awaiting next week's USDA crop report as soybeans are in a weather market and if hot & dry temperatures start to come about that's when you see a rally like what happened in 2012 sending prices to all-time highs.
TREND: HIGHER
CHART STRUCTURE: EXCELLENT

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.