Mike Seery's Daily Commodity Report 11-7-17

07 Nov in Blog

Mexican Peso Futures---The Mexican Peso in the December contract is down only 7 points this Tuesday currently trading at 5205 as I have been recommending a bearish position over the last couple of months with an average price on 2 contracts around 5330 & if you took the trade continue to place the stop loss above the 10 day high on the closing basis at 5238 which is just about 30 points away as volatility remains low.

 

The Peso is still trading below its 20 and 100 day moving average as the trend remains negative as the U.S dollars is up another 37 points today cracking the 95 level hitting a 15 week high continuing its bullish trend.

If you take a look at the daily chart there is a possible rounding bottom that might have taken place, but I will not 2nd guess as I will stay short, however for the bearish momentum to accelerate to the downside prices have to break the October 27th low of 5127 as that could possibly happen in the next couple of days as the chart structure is outstanding at the present time as prices really have gone nowhere over the last 3 weeks.

TREND: LOWER

CHART STRUCTURE: EXCELLENT

VOLATILITY: LOW

 

 

 

 

 

Crude Oil Futures--- Crude oil futures are slightly lower in today's trade down about $0.12 currently trading at 57.23 a barrel breaking a 3 day winning streak as I've been recommending a bullish position from around the 53.15 level and if you took the trade the stop loss stands at 51.91 as the chart structure is terrible at the present time to due the fact that prices have run up rather dramatically over the last several trading sessions.

 

The chart structure will start to improve on a daily basis therefore the monetary risk will be lowered which is always a good thing to see in my opinion as prices are trading far above their 20 and 100 day moving average as this trend is very strong and is starting to follow the coattails of the U.S stock market which hit another all-time high in today's trade.

The main reason why crude oil prices continue to move higher & the entire energy sector including unleaded gasoline and heating oil is strong global demand for these products as I think that is going to continue as worldwide economies continue to improve on a monthly basis especially here in the United States as we at a 17 year low in unemployment.

The next major level of resistance in oil prices is around the $59 level & if that is broken like I've written about in many previous blogs as I think we can crack the $60 level here in the coming weeks ahead so stay long as who knows how high prices can actually go.

TREND: HIGHER

CHART STRUCTURE: POOR

VOLATILITY: INCREASING

 

 

 

 

 

S&P 500 Futures--- The S&P 500 in the December contract is hitting all-time highs for the 3rd consecutive trading session up only 1 point at 2590 selling off slightly from session highs as this market remains extremely bullish and if you're long a futures contract place the stop under the 10 day low which now stands at 2555 and in Friday's trade will be raised to 2562 tightening up the monetary risk.

Very strong corporate earnings continue to propel the market higher as well as tax reforms right on the horizon as there is a lot of bullish fundamental news such as low unemployment & strong worldwide economies so continue to play this to the upside as I'm certainly not recommending any type of bearish position.

The entire equity market is trading above its 20 and 100 day moving average as this trend has been the strongest in 2017 as I think that will continue for the rest of the year and possibly for years to come as our GDP growth is at 3% with expectations of 4%/5% in the spring of 2018 which would be remarkable in my opinion as I do think this is going to be very bullish the depressed commodity markets which are extremely cheap compared to stock prices at this time.

Volatility in the stock market is low as the Vix indicator which is also known as the fear indicator is at a 10 year low as we just continue to grind higher on a daily basis.

TREND: HIGHER

CHART STRUCTURE: EXCELLENT

VOLATILITY: LOW

 

 

 

 

 

TRADING THEORY---Do You Over Trade ?---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 OVER TRADE 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.  

 

 

 

There is a substantial risk of loss in futures and futures options. 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.

 

 

 

 

Corn Futures--- Corn futures in the December contract are slightly lower for the 2nd trading session down 1 penny at 3.47 a bushel as the harvest is about 70% complete still behind the 5 year average due to heavy rains last week slowing the combines in the fields. Corn prices are stuck in a 10 week consolidation as this is becoming a very interesting chart pattern with extremely low volatility as I still think a breakout to the upside is coming, but it might take some more time as we still have over 4 billion bushels out in the fields keeping a lid on prices here in the short-term.

 

Corn prices are trading below their 20 and 100 day moving average looking to retest the October 12th low of 3.42 which could happen, however I will not take a short position as I'm looking at a bullish position if prices break 3.55 as the chart structure is outstanding at the present time as I do think downside prices are limited in corn and many commodities as well.

Harvest pressure continues as it generally occurs during the months of October and November so this is not out of the norm, however once the harvest is nearly complete the volatility will also start to pick up as we will start to focus on 2018's crop & how many acres the United States will plant which I think will be less than 2017.

TREND: MIXED

CHART STRUCTURE: EXCELLENT

VOLATILITY: VERY LOW

 

 

 

 

 

Sugar Futures--- Sugar futures in the March contract are up 16 points currently trading at 14.72 a pound testing the upper end of the recent trading range as I've been recommending a bullish position around the 14.57 level and if you took the trade continue to place the stop loss at 14.00 as the chart structure is excellent at the present time.

 

Prices need to break the November 1st high of 14.84 to continue its bullish momentum as I will be looking at recommending to add another position as the chart structure will also improve lowering the monetary risk later this week as I still think sugar prices are cheap especially compared to unleaded gasoline futures which continue to hit contract highs on a daily basis.

 

Sugar is used as a bio diesel and if gasoline prices continue to climb higher sugar will start to ride the coattails in my opinion coupled with the fact that corn prices are incredibly cheap & will also start to follow this sector to the upside once harvest is complete so continue to play this to the upside & take advantage of any price retracement as the risk/reward are in your favor in my opinion. Sugar prices are trading above their 20 and 100 day moving average as the short-term trend is higher as we have held major support on multiple occasions.

TREND: HIGHER

CHART STRUCTURE: EXCELLENT

VOLATILITY: LOW

 

 

 

 

 

Cotton Futures---Cotton futures finished the day lower by 78 points currently trading at 68.07 still stuck in a 7 week tight consolidation right near a 2 week low as I am currently not involved in this market as trading in a consolidation is very dangerous in my opinion as there seems to be no trend on the horizon.

 

Cotton prices are trading under their 20 and 100 day moving average telling you that the short-term trend is lower, however the short-term trend really is mixed to sideways as I will not take a short position as I will be very selective to take any short position in many of the commodity sectors at these depressed prices as I do think as we enter 2018 the bull markets will come again.

Harvest is in full swing in the southern part of the United States & should be wrapped up in the next couple of weeks as cotton is in the same situation as the grain market with a sideways to choppy trend until harvest is finished which is going to be relatively soon so keep a close eye on a possible breakout above 70.22 as that is the level I'm looking for to enter into a bullish position.

TREND: MIXED

CHART STRUCTURE: EXCELLENT

VOLATILITY: AVERAGE

 

 

 

 

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