Crude Oil Futures
Crude oil futures in the November contract is trading lower for the 4th consecutive session after settling last Friday in New York at 58.09 while currently trading at 55.55 down about $2.50 for the trading week as prices have now hit a 10-day low.
If you take a look at the daily chart, the price gap that was created on September 16th has been filled in today's trade, and if you have been following any of my previous blogs, you understand that I do not like price gaps as they generally are filled just like what has occurred in oil.
Crude is now trading below its 100-day moving average as I am currently not involved as the volatility is too high as I'm advising clients to avoid the entire energy sector at this time.
Oil prices are at major support as this market has been incredibly choppy over the last 5 months as fundamentally speaking the main reason for the depressed prices over the last week is due to resumption of Saudi crude capacity from the Sep 14th attacks on its oil installations after Saudi Aramco said Tuesday that its total crude production capacity now exceeds 11.0 million barrels per day which is a week ahead of schedule.
TREND: LOWER - MIXED
CHART STRUCTURE: POOR
VOLATILITY: HIGH
Gold Futures
Gold futures are ending the week on a sour note down $15 at 1,500 an ounce after settling last Friday in New York at 1,515 down about $15 for the week as prices are near a 7 week low right at major support.
I'm not involved in gold or precious metals. However, if you are long a futures contract, I would place the stop loss at 1,490 as an exit strategy as a possible head and shoulders chart pattern may have developed.
Gold prices are now trading under their 20-day moving average but still above their 100-day as the trend is mixed to lower as the volatility remains relatively high as this market is headline-driven.
The U.S. dollar is trading at a 2 year high as that has put pressure on gold and the precious metals sector as a whole as this commodity seems to have lost its luster over the last month as the stock market is still hovering right near all-time highs as money flows continue to enter that sector and out of gold.
TREND: MIXED - LOWER
CHART STRUCTURE: SOLID
VOLATILITY: HIGH
10-Year Note Futures
The 10-year note in the December contract settled last Friday in Chicago at 129/22 while currently trading at 130 /07 as the yield currently stands at 1.69% as the price is right near a 3 week high.
I'm sitting on the sidelines looking at entering into a bullish position as I still think yields are headed considerably lower as most of the European countries have negative interest rates as we wait for the Federal Reserve announcement in the next couple of weeks.
The 10-year note is trading right at its 20 day but still above its 100 day moving average as I think the downside is minimal as the yield still looks very expensive as I see no reason to put capital into a bank and lose money when I can buy the 10-year note issued by the U.S government that actually pays back nearly 1.7% as money flows will continue to come into the United States.
The volatility at the current time is very low as we are having tight trading ranges on a daily basis as I will wait for a 4 week high before entering into a position or I also will look at a possible counter-trend trade on a sharp sell-off so keep a close eye on this market as we could be involved next week.
TREND: MIXED
CHART STRUCTURE: SOLID
VOLATILITY: LOW
Palladium Futures
Palladium futures in the December contract is trading sharply higher for the 2nd consecutive session up another $15 at 1,658 hitting an all-time high once again as this gravy train continues and is by far the strongest out of the precious metal sector.
Palladium prices settled last Friday at 1,625 trading higher by over $30 for the week as I am currently not involved, but I certainly do believe higher prices are ahead as I do have clients who are involved in the palladium industry so stay long in my opinion as I still believe 2,000 is realistic.
Fundamentally speaking strong demand coupled with short supplies continue to fuel this market higher and if you are long a futures contract I would continue to place the stop loss under the 10-day low which stands at the September 18th low of 1,563 as an exit strategy as the chart structure will improve in next week's trade, therefore, the monetary risk will be lowered.
Gold and silver prices have dropped significantly over the last several weeks, but has had very little impact on palladium prices as these commodities can go on opposite directions and that's precisely what you're witnessing at this time as I see no reason to be short this market as this trend is remarkably strong.
TREND: HIGHER
CHART STRUCTURE: SOLID
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.
Cotton Futures
Cotton futures in the December contract settled last Friday in New York at 60.52 while currently trading at 60.30 unchanged for the trading week as prices have gone nowhere over the previous 10 days.
I have been recommending a bullish position from around the 61.50 level, and if you took the trade, continue to place the stop loss under the contract low, which stands at 56.59 as an exit strategy.
There are a couple of problems fundamentally speaking with cotton as there is no agreement between China and the U.S coupled with the fact that harvest is underway in the southern part of the United States as we should produce a very solid crop as that continues to keep a lid on prices, however, I will not 2nd guess as I will continue to place the proper stop loss.
Cotton prices are trading above their 20-day but still below their 100-day moving average standing at major resistance at 63.35 as that needs to be broken for the bullish momentum to continue. I also have a bullish recommendation on coffee as there are very few trends, but I don't think that situation is going to last much longer.
TREND: MIXED
CHART STRUCTURE: SOLID
VOLATILITY: LOW
Sugar Futures
Sugar futures in the March contract settled last Friday in New York at 12.07 a pound while currently trading at 12.65 up nearly 60 points for the week hitting a 5 week high on concerns that the sugar commissioner of Maharashtra, India's biggest sugar-producing state forecasted 2019/20 sugar production in Maharashtra at 5.2-5.3 MMT, down substantially from the previous estimate of 6.44 MMT, after floods last month damaged sugar crops.
Sugar prices are trading above their 20-day but still below their 100-day which stands at 12.91 as I'm currently sitting on the sidelines waiting for the chart structure to improve as it certainly looks to me that prices have bottomed as it also breached the down trend line.
If you are long a futures contract, I would place the stop loss at the contract low which was hit on September 12th at 11.74 as an exit strategy as the next level of resistance is at the 13.00 level which could be touched in next week's trade. I have bullish recommendations in cotton and coffee as there are very few trends currently as we will have to be patient and wait for something to develop.
TREND: MIXED
CHART STRUCTURE: POOR
VOLATILITY: INCREASING
Wheat Futures
Wheat futures in the December contract settled last Friday in Chicago at 4.82 a bushel while currently trading at 4.88 up about $0.04 for the trading week as the volatility has come to a crawl as we are looking for some fresh fundamental news to dictate short-term price action.
I have been recommending a bullish position from around the 4.84 level and if you took that trade continue to place the stop-loss under the contract low at 4.42 as an exit strategy, however in next week's trade if we're still involved I probably will raise that stop as the chart structure will improve, therefore, the monetary risk will also be lowered.
Wheat is now trading above its 20-day moving average, but still below their 100-day which stands at 5.00 as the trend is higher to mixed as I do think a bottom is at hand as this is my only grain recommendation at this time.
Seasonably speaking volatility generally increases in autumn and I think that situation will occur once again so stay long and continue to place the proper stop loss as I do believe prices will crack the $5 level in next week's trade.
TREND: HIGHER - MIXED
CHART STRUCTURE: EXCELLENT
VOLATILITY: LOW
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
Seery Futures
Facebook.com/seeryfutures
Twitter–@seeryfutures
Phone #: 630-408-3325
ms****@se**********.com
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.
where is the silver chart???????????????