Weekly Futures Recap With Mike Seery

Gold Futures

Gold futures in the December contract is currently trading at 1,509 after settling last Friday in New York at 1,457 up over $50 for the trading week hitting a 6-year high as interest rates in the United States and worldwide continue to drop precipitously weekly. China devalued its currency this week to an 11 year low against the U.S dollar as there is sheer panic worldwide that is causing gold prices to move higher as I am not involved, but I do believe higher prices are ahead.

If you are long a futures contract place the stop loss under the 2 week low standing at 1,412 as the charge structure is terrible at the current time due to the run-up in prices, however, I also have bullish recommendations in silver and platinum as money flows continue to enter into these sectors.

Gold prices are trading far above their 20 and 100-day moving average as this is probably the strongest trend besides the bond market at the current time as I see no reason to be short especially with all this worldwide uncertainty so if you are long-stay long. If you are not involved in this market, I would not chase this as that is very dangerous as you have missed the boat so move on and look at other markets that are beginning to trend with less risk.

TREND: HIGHER
CHART STRUCTURE: EXCELLENT
VOLATILITY: INCREASING

Silver Futures

Silver futures in the September contract settled last Friday in New York at 16.39 an ounce while currently trading at 16.94 up about $0.55 as prices hit a 13 month high continuing its bullish momentum following the coattails of gold which is at a 6 year high.

Interest rates around the world continue to plunge to the downside as that is a fundamental bullish factor towards silver prices as I have been recommending a bullish position from the 14.93 level and if you took the trade continue to place the stop loss at 16.08 on a closing basis only as an exit strategy.

I am also recommending a bullish platinum trade as I still think gold prices move higher, but I'm not involved as prices are trading far above their 20 and 100-day moving average telling you that the trend is getting stronger to the upside weekly.

For the bullish momentum to continue prices have to break the August 7th high of 12.26 in my opinion as I think that could happen in next week trade as I still believe silver prices look cheap especially compared to gold as I think prices will crack the $20 level in the coming weeks ahead so stay long and continue to place the proper stop loss.

The volatility in silver certainly has increased over the last several weeks and could become even more violent as historically speaking; this is one of the most volatile commodities in the world.

TREND: HIGHER
CHART STRUCTURE: POOR
VOLATILITY: HIGH

Platinum Futures

Platinum futures in the October contract is trading at 871 an ounce after settling last Friday in New York at 853 up about $18 for the week continuing its bullish momentum. However, it is still the weakest commodity compared to gold and silver.

I have been recommending a bullish position from around the 840 level and if you took that trade continue to place the stop loss on a closing basis only at 846 as we continually bounce off that level over the last week or so looking to break out above the July 25th high of 889 in my opinion as I think that could happen in next week's trade.

Platinum prices are trading above their 20 and 100-day moving average as the trend is higher as I still believe we're going to crack the April 8th high of 925 in the coming weeks ahead as the chart structure is improving as I will be looking at adding more contracts if the rally continues to the upside.

Volatility in platinum is starting to increase, and that is not surprising if you look at gold and silver they have had some tremendous price swings daily as I think that will begin to bleed into this commodity so stay long and continue to place the proper stop loss as I remain bullish.

TREND: HIGHER
CHART STRUCTURE: EXCELLENT
VOLATILITY: INCREASING

10-Year Note Futures

The 10-year note in the September contract is currently trading at 130/02 after settling last Friday in Chicago at 128 / 27 continuing its bullish momentum as prices are right near a 3 year high.

There are 12 countries worldwide that now have negative interest rates as it certainly looks like the yield on the 10-year note which currently stands at 1.68% could go all the way down to the 1% level in the coming months ahead as the Federal Reserve will be forced to lower rates at this time.

I have been recommending a bullish position from around the 128/00 level, and if you took that trade, the stop loss remains at 127 /00 as the chart structure will not improve until later next week therefor the monetary risk remains the same. Earlier in the week yields went down to the 1.59% level before profit-taking came about as this trend is very strong to the upside as we have the most expensive rates in the world as money flows are pouring in and that situation is not going to end anytime soon.

The U.S. stock market has dropped about 6% from the of all-time high just over the last couple of weeks experiencing crazy volatility and as long as that situation develops money will continue to enter into this sector so stay long as I will be looking at adding more contracts to the upside once the risk/reward become more in your favor.

TREND: HIGHER
CHART STRUCTURE: POOR
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 and is currently grown in the Midwestern part of the United States settled last Friday in Chicago at 4.09 a bushel while currently trading at 4.17 up about 8 cents as prices are at a 1 week high.

There are some concerns about dryness in certain sections as the weekly drought monitor showed dryness expanding in the corn belt and parts of the Southern Plains as of last Tuesday. I have been recommending a bullish position from the 4.00 level if you took the trade we're going to continue to place the stop loss under the contract low standing at 3.63, however, if that report is construed bullish I will then place to stop loss under the 2 week low, therefore, the monetary risk will be reduced significantly, but I want to give this trade room as you will undoubtedly see a large trading range come Monday afternoon.

Corn prices are trading above their 20-day but slightly below their 100-day moving average as it looks to me that the trend might be changing as there are wide variances on what this crop report will say between 13/14 billion bushel production number as the crop is still behind schedule and if we do go 3 or 4 weeks without rain the bullish trend will emerge once again.

At the present time, my only other grain recommendation is a bearish wheat trade is I exited the oats today as traders are keeping a close eye on weather and it will certainly be interesting to see how many acres were lost due to the flooding so stay long.

TREND: MIXED
CHART STRUCTURE: IMPROVING
VOLATILITY: AVERAGE

Wheat Futures

Wheat futures in the September contract is currently trading at 5.00 a bushel after settling last Friday in Chicago at 4.90 up about 10 cents for the trading week looking forward to the highly-anticipated crop report which will be released Monday afternoon which indeed will dictate short-term price action in my opinion.

I have been recommending a bearish position from around the 5 .04 level, and if you took that trade, I'm going to place the stop loss on a hard basis at 5.07. I'm not willing to risk any more than that level, especially when that report is released.

Wheat prices are now trading above their 20-day but still below their 100-day moving average as this market keeps bouncing off of 4.80 level and has rallied every single time, and if we are stopped out it's pretty much a neutral situation, and then we will look at other markets that are beginning to trend.

At the current time I also have a bullish corn recommendation and a bearish oat trade as the grain market, in general, remains bearish, but that crop could change everything very quickly as earlier in the week prices went lower due to the fact that China devalued their currency and that they will not buy any agricultural commodities from the United States, however prices have stabilized so continue to place the proper stop loss.

TREND: MIXED
CHART STRUCTURE: EXCELLENT
VOLATILITY: AVERAGE

Orange Juice Futures

Orange juice futures in the September contract settled last Friday in New York at 99.20 while currently trading at 102.20 up 300 points for the trading week heading right back up into the 8-week consolidation that we witnessed over the last couple of months.

Orange juice prices are now trading right at their 20-day but still under their 100-day moving average as I have been recommending a bearish position from around the 98.50 level as this trade has been stubborn and if you took that trade continue to place the stop loss at the 107 level as an exit strategy.

The volatility in orange juice at the present time is very low as we need some fresh fundamental news to dictate short-term price action and pick up the volatility as ideal growing conditions in the country of Brazil and the State of Florida continue to keep a lid on prices as I will remain short while placing the proper stop loss.

In my opinion, I do believe the risk/reward is in your favor, and if you did not take the first trade, I would still do it at today's price level as the risk would be around $750 per contract plus slippage and commission.

TREND: LOWER - MIXED
CHART STRUCTURE: EXCELLENT
VOLATILITY: LOW

Oat Futures

Oat futures in the December contract is currently trading at 2.74 a bushel after settling last Friday in Chicago at 2.70 up about $0.04 for the trading week.

I have been recommending a bullish position over the last several weeks from the 2.75 level as it is time to exit and move on as I do not want to take this position into that highly anticipated crop report as this trade was neutral.

Oat prices are trading above their 20 and 100-day moving average as the trend may have turned, but I will sit on the sidelines and wait and see what that report states.

Volatility in the oat market is relatively low at the current time for the as the chart structure is solid as we could be involved in this market in the coming weeks ahead, but this crop report as so many variances and nobody knows what direction prices will go as it's too dangerous so move on and look at other commodities markets that are beginning to trend.

TREND: MIXED - HIGHER
CHART STRUCTURE: EXCELLENT
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.