Schad Commodity’s Weekend Report: An Insider’s View of the Next Big Market Move

Once each week, usually on Friday evenings, we update our personal weekly commodity trading charts and review them for changes in “net long” or, “net short” holdings between the big commercial commodity traders, large speculators, and the usually uninformed public. This is our professional analysis of “the bigger picture” and current dynamics for each market which provide a spyglass view of the BIG commercial traders and what they are currently doing to influence the futures markets. As you may already know, insider trading with stocks on Wall Street is very illegal. However, in the commodity trading industry, large/commercial traders MUST report their positions EACH WEEK to the CFTC regulatory body, hence, we monitor them on a weekly basis. Although the futures markets themselves will ultimately provide the most accurate illustration of trend, these (weekly) charts we’ve identified, serve to forewarn us of the next possible bigger move. Here are the commodity markets which illustrate the changing bigger picture for them: UP Trending Futures Markets:  Japanese Yen (New this week.) DOWN Trending Futures Markets:  Soy Oil, Sugar, Russell 2000 Index, Silver and S&P 500 Index & Feeder Cattle (Both new this week.) ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL...

Gold Futures Sink Another $21 on Durable Goods Data

Gold futures have sold-off for a third session in a row from its $1,170 highs only on Monday once domestic durable goods orders rose an unexpected amount last month and now boosting sentiment for a forthcoming interest-rate hike. Gold futures are now down $12.40 per ounce and currently trading at $1,126 at New York’s Commodity Exchange. When durable goods orders were expected to “drop” by 0.4%, the US Department of Commerce reported an actual increase for total durable goods orders by 2% last month. To reinforce the sentiment, June’s durable goods order’s were revised to a “4.1%” gain from the 3.4% which was previously reported. Laura Taylor, a senior market strategist at RJO Futures in Chicago, shares her view regarding the fundamental assessment of the gold futures markets by stating, “Traders have been looking for something they can sink their teeth into regarding the direction of interest-rates. This durable goods order maybe created a ‘capitulation’ for the gold market correction.” Taylor added, “The gold trade will have to keep today’s lows if the rally will continue.” The technical trend for gold turned up only one week ago today. Gold futures still look strong despite the three-day sell-off so if there are any jewelers or electricians out there looking for a place to buy, this may be it. ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL...

Australian Cattle Market at Record High Diverging with US Cattle Futures

Maybe cattle futures “down under” are lagging behind the US livestock market, but Australian cattle prices are hitting record highs as our domestic cattle market continues to slide from late last year’s highs. Feeder cattle futures for October delivery are trading down $4 (CWT) today currently at $1.955 per pound at the Chicago Mercantile Exchange. So far the Australian cattle market has realized gains as high as 68% (YTD) over the past year at a time when US cattle futures are down about 10% for the year, and steer values in Brazil are seeing their lowest in the past five years. It was only this past October that US “live cattle” futures saw a record high of nearly $172.00 a pound (CWT) after animals were taken out of the beef production line and beef prices raised for the animals that were available. “The US cattle market is showing it has already priced in the lack of supply and has discounted the drought-breaking rains earlier in the year by failing to rally,” said Nicholas Medina, a futures and options specialist for Capital Trading Group in Chicago, regarding the fundamental assessment of the cattle futures markets. Medina added, “It is clear the domestic cattle market is in ‘full-swing’ rebuilding mode and cattle futures have little chance of return to new highs at this point in the season – in my view.” Feeder cattle futures trend is down with no bottom in sight. Two weeks earlier feeder cattle futures was at a crossroads to test the highs of last year, but have failed miserably since. Back to “what is good for the...

Commodity Crop Markets a Hot Potato for Hedge Funds

Hedge funds are reportedly bailing on crop commodity markets such as the grains and cotton while the USDA reports excess supply adding to inventories. The grain markets have closed mixed today after an initial sell-off in the overnight markets, but cotton has been weak all during this trading session and is currently down 285 points to close the day near .6406 cents per pound at the Intercontinental Exchange. For five straight weeks now the USDA has reported professional funds downsizing their bets for higher crop prices when in fact markets such as corn, soybeans, and wheat are seeing a reported combined slowing demand amid bumper global harvests. The “bullish” holdings have reportedly dropped 67% in five weeks! “The fundamentals just don’t support higher crop prices right now and in the foreseeable future,” said Kevin Craney, Director of Managed Futures at RJO Futures in Chicago, regarding the fundamental assessment of the crop-orientated commodity futures markets. Craney added, “The hedge funds may have been looking for an orderly way out of the bullish positions, but evolved more into a situation of ‘musical chairs’ or getting out when opportunities presented itself which never materialized.” All of the grain markets that are followed here are in down-trends with no bottom yet in sight. Cotton futures, however, appear to be resuming its overall downtrend just when a bullish scenario had been unfolding. ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF...

Schad Commodity’s Weekend Report: An Insider’s View of the Next Big Market Move

Once each week, usually on Friday evenings, we update our personal weekly commodity trading charts and review them for changes in “net long” or, “net short” holdings between the big commercial commodity traders, large speculators, and the usually uninformed public. This is our professional analysis of “the bigger picture” and current dynamics for each market which provide a spyglass view of the BIG commercial traders and what they are currently doing to influence the futures markets. As you may already know, insider trading with stocks on Wall Street is very illegal. However, in the commodity trading industry, large/commercial traders MUST report their positions EACH WEEK to the CFTC regulatory body, hence, we monitor them on a weekly basis. Although the futures markets themselves will ultimately provide the most accurate illustration of trend, these (weekly) charts we’ve identified, serve to forewarn us of the next possible bigger move. Here are the commodity markets which illustrate the changing bigger picture for them: UP Trending Futures Markets:  10yr. T-Notes (New this week.) DOWN Trending Futures Markets:  Soy Oil, Sugar, Russell 2000 Index, Crude Oil, Silver and Coffee (New this week.) ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL...