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 June contract settled last Friday in New York at 1,226 an ounce while currently trading at 1,230 down about $4 for the trading week and is still hovering right near a 7 week low. I'm currently sitting on the sidelines at present. As I've written about in previous blogs, I remain bearish on gold, and I think the stock market will continue to move higher. If you are short a futures contract, I would place your stop above the 10-day high which stands at 1,272 as the chart structure will start to improve later next week, therefore, lowering the monetary risk. Gold prices are still trading under their 20 and 100-day moving average is telling you that the short-term trend is lower as volatility is relatively low. I don't expect that to continue for much longer as generally speaking volatility starts to increase in the summer months for the commodity markets. The precious metals have been on the defensive over the last couple of months as silver and platinum are also right near multi-month lows as the commodity markets remain extremely choppy and have been over the last 6 months.
TREND: LOWER
CHART STRUCTURE: POOR - IMPROVING

Silver Futures

Silver futures in the July contract settled last Friday in New York at 16.27 an ounce while currently trading at 16.45 up about $0.20 for the trading week and it's still right near a 5 month low as prices have rebounded due to oversold conditions in my opinion. At the current time, I'm not involved in silver as prices have dropped over $2 from their April 17th high and the chart structure is very poor. Silver futures are trading far under their 20 and 100-day moving average telling you that the short-term trend is to the downside and prices are probably looking to retest the December 23rd low around 15.84. The precious metals remain weak because all of the interest remains in the U.S stock market which is right near all-time highs once again. Silver prices have been extremely choppy over the last 6 months rallying several dollars and then selling off several dollars as that has been the case with many of the commodity sectors. In years past we had terrific trends, but that has not been the case in 2017 as the risk/reward is not in favor at the present time so move on and look at other markets that are beginning to trend.
TREND: LOWER
CHART STRUCTURE: POOR

Crude Oil Futures

Crude oil futures in the June contract are trading higher for the 3rd consecutive trading session after settling last Friday at 46.22 while currently trading at 48.00 a barrel and I'm currently not involved in this market. Oil prices had a spike bottom last Friday which was May 5th at 43.76 & has rallied about $4. This market remains choppy just like all the other commodity sectors. However, if you are short a futures contract, I would place the stop loss above the 10-day high which stands at 49.32 as prices are still trading under their 20 and 100-day moving average telling you that the short-term trend is lower. OPEC has come back into the news possibly cutting production once again to try to prop up prices as oversupply issues are the biggest problem with this sector as every time prices rally rig counts in the United States increase, therefore, putting pressure back on prices. Prices have surged over the last several days off of the API report which showed a larger drawdown of crude oil supplies, but basically, I think a lot of this was short covering as prices were in oversold territory.
TREND: LOWER
CHART STRUCTURE: SOLID

Nasdaq 100 Futures

The Nasdaq 100 in the June contract settled last Friday in Chicago at 5648 while currently trading at 5678 up another 30 points hitting another all-time high this week. I'm not involved in this commodity. However, I am very bullish the stock market, and I've written about this in many previous blogs, I do think higher prices are ahead. The NASDAQ 100 is trading far above it's 20 and 100-day moving average being propelled by Apple Computer. Apple is up another $2 hitting another all-time high as the tech sector is still on fire. I'm certainly not recommending any bearish position as this is the strongest trend out of all of the markets at the current time. I do think the Dow Jones and the S&P 500 will continue to follow. However, the NASDAQ is the strongest of all of the stock indices and clearly is the leader to the upside. Fundamentally speaking this market has the perfect situation occurring with extremely low-interest rates coupled with outstanding earnings and a Trump administration that is pro-business so who knows how high prices can go, but in my opinion, they are going much higher so if you are in a bullish position stay long.
TREND: HIGHER
CHART STRUCTURE: IMPROVING

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.

Corn Futures

Corn futures in the December contract are currently down 3 cents this week in Chicago and currently trading at 3.87 a bushel reversing some of this week's gains off of the USDA crop report showing that ending stocks were decreased sending prices up nearly 7 cents. I am currently not involved in this market and I am advising clients to avoid this commodity as we remain extremely choppy over the last months with no trend. Corn prices are trading right at their 20 and 100-day moving average with estimates around 45% of the corn crop already planted in the Midwestern part of the United States which is pretty much on normal pace as we start to enter the hot & dry season starting in the next several weeks. Corn needs to break above 3.96 to start any bullish momentum or below 3.78 to start any bearish momentum as volatility certainly is going to increase and already has in recent weeks as this will turn into a weather market. I looked at the 7 to 10-day forecast as the mid 80s are starting to come about with warmer weather is ahead, however at the current time I do not have any grain recommendations.
TREND: MIXED
CHART STRUCTURE: SOLID

Soybean Futures

Soybean futures in the November contract which is considered the new crop is trading lower for the 3rd consecutive trading session reacting positive off of the USDA crop report on Wednesday and traded as high as 9.80 then sold off towards the closing bell. I'm still sitting on the sidelines waiting for a breakout to occur. Estimates of the 2017 crop were around 4.3 billion bushels. However, I disagree with that number, and I think it could be much higher around 4.50 billion bushels. It is a long growing season and only time will tell as prices are still stuck in a 6-week consolidation. Estimates of planted soybean acres at the current time are around 20% which is pretty much normal as prices are still trading below their 20 and 100-day moving average as this commodity has very little bullish fundamental news to push prices up here in the short term. The grain market, especially soybeans and corn are entering the highly volatile summer months, and volatility will expand exponentially if hot and dry conditions start to come about with 80° right around the corner which is not detrimental to growing conditions. However, that shows you that warmer temperatures are on the way finally as we have been wet and cold in the Midwestern part of the United States.
TREND: LOWER - MIXED
CHART STRUCTURE: EXCELLENT

Sugar Futures

Sugar futures in the July contract settled last Friday in New York at 15.31 a pound while currently trading at 15.65 up about 35 points for the trading week. I'm currently not involved but have had a bearish stance for quite some time, and I do have clients who are short. If that is the case, continue to place your stop loss above the 10-day high which stands at 16.49 as that will possibly be lowered in 2 days all the way down to 15.93. The chart structure is outstanding at the present time. The next level of support was last Friday's low of 15.24 as many of the commodities are higher this Friday due to weaker U.S dollar as prices are still trading under their 20 and 100-day moving average. This has been a strong trend to the downside over the last couple of months. Volatility in sugar is relatively low at the present time, however, if you are not involved in this market look at other trends that are beginning because this trade is a little long in the tooth. Higher production & lack of demand is what has put pressure on this market over the last several months, and all of the bad news has already been reflected in the price and if you are short continue to place the proper stop loss. 2nd guessing is the kiss of death over the course of time in my opinion.
TREND: LOWER
CHART STRUCTURE: EXCELLENT

Coffee Futures

Coffee futures in the July contract are up 75 points currently trading at 135.00 a pound after settling last Friday at 135.70 down slightly for the trading week and still trading under their 20 and 100-day moving average as volatility has come to a crawl. Coffee prices have been in a 2-week consolidation bottoming out on April 27th at 128.65. I'm currently not involved in this market looking for a trend to develop. However, I do think prices are limited to the downside. Ideal weather conditions in the country of Brazil which is the largest producer of coffee in the world is what has continued to put pressure on this commodity over the last 6 months. I do think all of the bearish fundamental news has already been reflected in the price. I can't imagine that the volatility will stay this low for much longer as we are in the possible frost season for coffee which can send prices sharply higher. For the breakout to the upside to occur at this moment prices would have to crack 146 which is still a good distance away. However, the chart structure is starting to improve as we could be involved in this market possibly next week.
TREND: LOWER - MIXED
CHART STRUCTURE: IMPROVING

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.