S&P 500 Futures
The S&P 500 futures in the September contract is currently trading at 3491 as prices are experiencing a 7-day winning streak hitting an all-time high this week trade continuing its bullish momentum as this by far is the strongest trend out of all sectors to the upside.
The Nasdaq-100 also hit another all-time high this week as money flows continue to enter this sector because there is nowhere else to park your money, and that situation is not going to change at least throughout 2020. If you are long a futures contract, continue to place the stop loss under the 10-day low at 3344 as an exit strategy. However, the chart structure will improve in 3 trading sessions. Therefore, the monetary risk will be lowered as I still think higher prices are ahead.
The S&P 500 is trading far above their 20 and 100-day moving average. The trend is strong to the upside continually grinding higher daily as the volatility has certainly decreased over the last couple of weeks. I think the commodity and stock markets continue to move higher. I see no reason to be short while trying to pick the top as that is extremely dangerous over time, as trading with the path of least resistance is the most successful way to trade, in my opinion.
CHART STRUCTURE: SOLID
Silver futures in the September contract settled last Friday in New York at 26.73 while currently trading at 27.57 an ounce up over $0.80 continuing it’s bullish momentum still experiencing crazy volatility daily.
I have been recommending a bullish position over the last couple of months all the way back from the 18.61 level. If you took that trade, continue to place the stop loss under the 10-Day low now standing at 26.09 as an exit strategy and the proper money management technique.
If you look at the daily chart, the uptrend line remains intact as prices are still trading above their 20 and 100-day moving average, which tells you that the trend is to the upside. Prices are consolidating the massive run-up that took place over the last couple of months, in my opinion. For the bullish momentum to continue, prices have to break the contract high that was hit on August 7th at 30.19, which could happen in next week’s trade. I see no reason to short silver or precious metals as there is more room to run.
CHART STRUCTURE: IMPROVING
Sugar futures in the October contract settled last Friday in New York at 12.83 while currently trading at 12.76 a pound down slightly for the trading week looking for some fresh fundamental news to dictate short-term price action.
I have been recommending a bullish position over the last several weeks from around the 12.61 level. If you took that trade continue to place the stop loss on a closing basis only at 12.50 as the proper exit strategy. The chart structure is outstanding at the current time due to the low volatility that we are currently witnessing.
Sugar prices are now trading below their 20-day but still above their 100-day moving average as the trend is higher to mixed as this is my only soft commodity recommendation. Still, I do have many bullish trades to the upside as I think the commodity sectors across-the-board look very attractive as I think the downside is limited. For the bullish momentum to continue, prices have to break the 13.15 level, in my opinion, so stay long and continue to place the proper stop loss. I do not like to 2nd guess as in the long run, that does not work.
TREND: HIGHER – MIXED
CHART STRUCTURE: EXCELLENT
Lean Hog Futures
Hog futures in the October contract ended the week on a sour note down 192 points at 53.80 after settling last Friday in Chicago at 54.25 down slightly for the trading week filling the price gap at 52.80 possibly next week.
I have been recommending a bullish position from around the 50.75 level, and if you took that trade, continue to place the stop loss under the 10-day low standing at 51.78 as the chart structure is excellent. Presently this is my only livestock recommendation as I was stopped out of a cattle trade earlier in the trading week. I still believe many commodity sectors are headed higher, and I believe a long-term bottom in the hog market has been created.
Hog prices are trading above their 20 and 100-day moving average as the trend is slightly higher as historically speaking prices are near a multi-decade low, however fundamentally and technically speaking, the tide might be turning to the upside, so stay long.
CHART STRUCTURE: EXCELLENT
Soybean Meal Futures
Soybean meal futures in the December contract is currently trading at 310.0 a ton after settling last Friday in Chicago at 297.0 up about 4% for the trading week as prices are right near a 5 month high.
I have been recommending a bullish trade from around the 299 level, and if you took that trade, continue to place the stop loss under the 2 week low of 296 as the chart structure will improve daily starting next week.
Demand has increased substantially over the last several weeks because China has come back strong into this market, living up to the phase one trade deal despite the Coronavirus problems as this market has broken out to the upside. The next major level of resistance is at 315/320, and if that is broken, I think prices could accelerate to the upside, so stay long as the risk/reward is in your favor.
Soybean meal prices are trading above their 20 and 100-day moving average as the trend is to the upside as I also have a bullish soybean trade as they generally follow one another. That is precisely what is happened in Friday’s trade, as I believe the complex looks cheap.
CHART STRUCTURE: SOLID
Soybean futures in the November contract settled last Friday in Chicago at 9.04 a bushel while currently trading at 9.48 up around $0.45 for the trading week as prices have now hit a 7 month high.
Fundamentally speaking, this situation has turned bullish as China has come back into this market. Coupled with the fact that there are sections of hot and dry weather throughout the Midwestern part of the United States causing concern that the crop might deteriorate as we head into the harvest.
I have been recommending a bullish position from around the 9.14 level, and if you took the trade, continue to place the stop loss under the 10-day low, which now stands at 9.01 as an exit strategy as I still think there is room to run to the upside. The next major level of resistance stands at the January 8th high of 9.82. I think that could be hit next week as the grain market looks strong. I also have a bullish soybean meal recommendation to the upside.
CHART STRUCTURE: SOLID
What’s the difference between an old crop and a new crop in the agricultural commodities? When analysts and traders talk about agricultural commodities such as soybeans and corn, they generally mention old crop versus new crop, which might confuse some beginners on what exactly is the difference.
I will keep it simple because the only difference between the old crop and the new crop is that old crop in soybeans is any month other than November. An example is March or May, and all months that were grown last year while the new crop is the November soybeans and will be harvested this October of 2019 and grown this summer.
That’s why sometimes there is a price difference between the old crop and the new crop. This year’s harvest in soybeans could be as high as 4.1 billion bushels pushing prices lower in the November contract as old crop and the new crop can also have different carryover levels or supply levels.
The old crop corn is any month other than the December contract, while the new crop is only the December contract, which will be grown this summer and harvested in October. Sometimes there’s a price difference between old crop and the new crop because as we will be harvesting around 14 billion bushels in October, which is the reason why the December corn can be lower than the May corn. That’s because that was the old crop was harvested last October, also having a different supply situation.
Many agricultural commodities are affected by the old crop and the new crop, including grains, meats, coffee, and cotton, so if you need help understanding which month you should be trading feel free to give me a call at any time. I will be more than happy to make sure that you are trading the correct month.
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
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.