Stay Short Lumber

13 Dec in Blog, coffee futures, commodity trading, cotton futures, futures trading, lumber futures, Mike Seery, orange juice futures, seeryfutures, sugar futures

Lumber Futures--- Lumber futures in the January contract are lower for the 2nd consecutive session down another 600 points at 417.50 as I have been recommending a bearish position from around the 426 level as traders are awaiting the highly anticipated FOMC meeting which comes out this afternoon which will certainly dictate short-term price action in my opinion.

Lumber prices are trading below their 20 day but still far above their 100 day moving average which remains at 402, however I think prices topped out at all-time highs at the 460 level last month as I will continue to stay short as the critical level is at the 411 area & if that is breached the all-out bear market could extend further.

Interest rates are the main factor for lumber prices as I believe that interest rates will continue to rise as I'm also bearish the 10 year note coupled with the fact that prices are extremely high & way out of order compared to the rest of the commodity markets so continue to play this to the downside in my opinion as the risk/reward are in your favor due to the fact that lumber is an extremely volatile commodity with huge price swings on a daily basis and huge risk.

I will be looking at adding more contracts possibly later this week as the chart structure is outstanding at the present time & will start to improve in Friday's trade therefore lowering the monetary risk.

TREND: LOWER

CHART STRUCTURE: EXCELLENT

VOLATILITY---LOW

 

 

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