Gold Futures
Gold futures in the August contract is currently trading higher by $12 at 1,440 an ounce after settling last Friday in New York at 1,412 up about $28 hitting a new 6 year high as this market looks to test the 1,500 level in the coming weeks ahead in my opinion.
I'm not involved in gold, but I have bullish positions across the board in the precious metals as I still think gold prices continue to March higher and if you are long a futures contract place the stop loss under the 2 week low which stands at 1,384 as an exit strategy.
Gold prices are trading far above their 20 and 100-day moving average as this trend is strong to the upside as silver prices are up over $0.40 today and still looks very cheap compared to gold prices.
Volatility in gold has accelerated as that is here to stay in my opinion as I think strong demand will continue to support gold and the precious metals across-the-board as U.S. interest rates remain at extremely low levels which is bullish towards the commodity markets.
When you trade the commodity markets finding the trend is the most important aspect as the precious metals have now developed into strong trends as you should have bullish positions, not bearish positions as that would be counter-trend trading.
TREND: HIGHER
CHART STRUCTURE: IMPROVING
VOLATILITY: HIGH
Silver Futures
Silver futures in the September contract is trading higher for the 6th consecutive session hitting a fresh 1 year high currently trading at 16.40 after settling last Friday in New York at 15.23 as prices rallied about $1.15 or up about 7% continuing its bullish momentum.
I have been recommending a bullish position from around the 14.93 level, and if you took that trade, the stop loss has now been raised to 14.91 as the chart structure will improve in next week's trade; therefore, the monetary risk will be lowered as prices have skyrocketed over the last week.
I have bullish recommendations also in platinum and copper, which are also sharply higher in today's trade as the precious metals still look cheap in my opinion, especially compared to gold prices.
Silver is now trading far above its 20 and 100-day moving average as the trend is clearly higher, however there are some concerns about prices experiencing overbought levels, and that might be true, but I will continue to stay long as I still think prices could trade at the $20 range in the coming months ahead as I see no reason to be short.
TREND: HIGHER
CHART STRUCTURE: IMPROVING
VOLATILITY: INCREASING
Copper Futures
Copper futures in the September contract settled last Friday at 2.6940 while currently trading a 2.7765 up about 800 points for the trading week hitting a 2 month high.
I have been recommending a bullish position from around the 2.7130 level as this trade was stubborn for a couple of weeks, but now has truly broken out to the upside. If you took the trade place the stop loss under the contract low standing at 2.6000 as the chart structure will start to improve in next week's trade, therefore, the monetary risk will also be lowered.
Copper prices are trading above their 20-day but still below their 100-day moving average, which is just an eyelash away 2.8000. I think that will be broken in next week's trade with the possibility of retesting the contract high, which was hit on April 17th at 3.0080 in my opinion.
I have bullish recommendations in silver and platinum as the precious metals look to continue to move higher so stay long & place the proper stop loss as there is still room to run to the upside in my opinion as these trends are very strong.
TREND: HIGHER
CHART STRUCTURE: SOLID
VOLATILITY: AVERAGE
Platinum Futures
Platinum futures in the October contract settled last Friday at 834 while currently trading at 861 an ounce up about $27 for the trading week higher for the 8th consecutive session as prices have now hit a 2 month high.
The precious metals across the board are higher today as this sector is experiencing the strongest trend to the upside. I have been recommending a bullish position from around the 840 level, and if you took the trade, continue to place the stop loss under the contract low, which stands at 793 as an exit strategy.
In next weeks trade I will raise the stop loss, therefore, the monetary risk will be reduced as prices are now trading above their 20 and 100-day moving average for the 1st time in months coupled with the fact that we have a nice rounded bottom technical chart pattern which has developed so stay long as I still think prices will retest the April 8th contract high of 925 in the coming weeks ahead.
Volatility in platinum remains very low as historically speaking this commodity can have tremendous price swings with large risk, but we are just climbing up the ladder.
TREND: HIGHER
CHART STRUCTURE: SOLID
VOLATILITY: LOW
Palladium Futures
Palladium futures in the September contract is currently trading at 1,504 after settling last Friday at 1,542 down about $38 for the trading week as I had been recommending a bullish position from around the 1,388 level getting stopped out earlier in the week at 1,526 as I'm currently sitting on the sidelines waiting for a better chart pattern to develop.
Palladium prices may have created a double top around the 1,600 level, however, I think the recent retracement in price is blamed on profit-taking and overbought conditions as I still have a bullish biased towards this commodity, but the risk/reward is not your favor to take a position at this time.
Currently, I have recommendations in silver and platinum as I think the whole sector moves higher as the volatility certainly has come to life, and that is no surprise to me as I believe that will become even more violent in the coming weeks and months ahead.
Palladium prices hit a 3 week low, and it's now trading under its 20-day moving average for the 1st time in months, but still far above their 100-day as the trend is mixed so be patient and let's see what develops in the coming weeks ahead.
TREND: MIXED
CHART STRUCTURE: IMPROVING
VOLATILITY: HIGH
If you are looking for a futures broker feel free to contact Michael Seery at 630-408-3325 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 which is considered the new crop is currently trading at 4.36 a bushel after settling last Friday in Chicago at 4.59 as hot temperatures have entered the midwestern part of the United States coupled with the fact of heavy rains and that has pushed prices lower. The crop development should start to improve as hot & wet weather is what corn and soybeans like as that is exactly what is occurring at this time as the weather will turn cooler next week.
The large money managed funds are still long around 180,000 contracts as they still believe higher prices are ahead as I am currently not involved, but I do think the downside is limited as I would love to see the gap at 4.20 be filled as then I will be entering into a bullish position. Traders are awaiting the August 12th crop report as that certainly will send some clarity into this market as we don't know how many acres were planted in 2019 so look to be a buyer on some type of price dip.
Corn prices are now trading right at their 20-day but still above their 100-day moving average as the trend is mixed as we have gone nowhere since late May as we are awaiting some fresh fundamental news to dictate short term action.
TREND: HIGHER - MIXED
CHART STRUCTURE: IMPROVING
VOLATILITY: HIGH
Coffee Futures
Coffee futures in the September contract settled last Friday in New York at 106.65 while currently trading at 108.85 up over 200 points as prices are stuck in a 2-week consolidation.
Coffee prices are trading above their 20 and 100-day moving average as the trend is higher as fundamentally speaking the International Coffee Organization on July 3rd cut its global 2018/19 coffee surplus estimate by -8.8% to 3.11 mln bags from a prior view of 3.41 mln bags. Also, current coffee supplies have tightened after the Green Coffee Association on Monday reported that U.S. June green coffee inventories fell -0.4% y/y to 6.82 mln bags. On the negative side, the harvest is about 66% complete as dry weather conditions are allowing the fieldwork to be brisk as harvest should be wrapped up around September 1st.
I'm sitting on the sidelines as I keep waiting for the 103 level to be touched so be patient as I still think coffee is in a bottoming out pattern as I will not go short.
I do not have any soft commodity recommendations as I was stopped out of my sugar trade earlier this week as all of the excitement recently has been in the precious metals which are experiencing strong trends.
TREND: HIGHER - MIXED
CHART STRUCTURE: IMPROVING
VOLATILITY: AVERAGE
Soybean Futures
Soybean futures in the November contract which is considered the new crop is sharply higher this Friday afternoon in Chicago at 9.19 a bushel after settling last Friday at 9.31 down slightly for the week as hot and wet weather conditions have arrived in the midwestern part of the United States as that should help soybean crop conditions improve.
I'm not involved in soybeans as my only recommendation was a bullish soybean oil trade which I exited yesterday as this market has been very choppy since late May as prices have gone nowhere so I will wait for a better chart pattern and the risk/reward to become in your favor to take a bullish position.
Crop estimates vary widely as we don't know how many acres were planted in 2019 and we're not going to find out until August 12th when the next crop report is released so we might remain choppy over the next several weeks.
Soybean prices are trading right at their 20 and 100-day moving average as the trend is mixed as prices did break a 4-day losing streak today while also holding major support, but sit on the sidelines as trading in a choppy market is very difficult to do successfully over time.
TREND: MIXED
CHART STRUCTURE: IMPROVING
VOLATILITY: HIGH
Oat Futures
Oat futures in the September contract are near a 2 month low in today's trade continuing its bearish momentum down another 3 cents at 2.72 a bushel as I have been recommending a bearish position from around the 2.75 level while placing the stop loss above the July 3rd high of 2.89 as an exit strategy as the risk is around $700 per contract plus slippage & commission.
The grain market, in general, is starting to show some weakness as improving weather conditions are putting pressure on prices and if you take a look at the daily chart the downtrend line remains intact so take a shot at the downside while making sure that you risk 2% of your account balance on any given trade as the proper money management technique.
The volatility at the current time is average as this commodity can experience large price swings especially during the summer months, but it looks to me that a possible head and shoulders top chart pattern has developed as prices peaked out on June 14th at 2.99 so look to play this to the downside.
TREND: LOWER
CHART STRUCTURE: SOLID
VOLATILITY: LOW
Orange Juice Futures
Orange juice futures in the September contract is traded higher by 320 points at 103.70 reversing some of the recent weakness that we have experienced. I will be recommending a bearish position if prices break the 98.85 level on a closing basis while then placing the stop loss above the 107 level as the risk is around $1,250 per contract plus slippage and commission.
Orange juice prices have been going sideways over the last 5 months as a breakout looks to occur with the possibility of the retest of the contract low which was hit on May 6th at 94.40 as the soft commodity sector remains negative.
Juice prices are trading below their 20 and 100-day moving average telling you that the trend is to the downside and I think if the 3-month low is broken a short position would be prudent as the risk/reward is still in your favor in my opinion.
Seasonality speaking juice prices generally decline in the summer months as there is no frost or freeze concerns that could hurt production numbers in the State of Florida as this market continues to drip lower so look to play this to the downside possibly in tomorrow's trade.
TREND: LOWER
CHART STRUCTURE: SOLID
VOLATILITY: LOW
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.
If you are looking for a futures broker feel free to contact Michael Seery at 630-408-3325 and he will be more than happy to help you with your trading or visit www.seeryfutures.com
Michael Seery, President
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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. My opinion in this blog are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any futures or option contracts.
