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Schad Commodity Blog & Commentary
This commentary is intended to provide unique insights with my 30+ years experience for the commodity crypto & futures markets we use in our everyday lives and is recognized, and has been selected, by Feedspot as one of the the Top 20 Futures Trading Blogs on the web. Schad Commodity views & opinion only. For additional commentary, and to assure you’re receiving the Schad Commodity Daily Report, be sure to connect on Facebook® & Twitter®.
From the desk of Brian Schad:
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: Soy Oil (New this week.)
DOWN Trending Futures Markets: Corn, Soymeal, Soybeans, Japanese Yen & 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 CONDITION.
Wheat Futures Higher With Continued Short-Covering, Winter-Wheat Concerns
Wheat futures have resumed their rally after a day’s break with short-covering momentum returning to challenging their recent highs. July CBT Wheat futures are currently up .12 cents near their high of the day as of this writing at $5.23 per bushel at the Chicago Board of Trade.
US winter-wheat prices are up an average 9% from last week with the last of the bearish holdouts and renewed concern over the health of this year’s winter wheat crop. The USDA actually downgraded the the rating of our domestic winter-wheat crop from 45% (week before last), to 44% just recently.
Barb Levy, chief director for The Fox Group’s futures division in Chicago, shared her view regarding the fundamental assessment of the wheat futures market by stating, “This year’s wheat (futures) prices seem to be marching to a different drummer by bucking the overall fundamental picture.” Levy adds, “The same group (the “USDA”) that downgraded the rating by 1% measly percent also upgraded spring-wheat by the same 1% but reported 91% of crop emergence – improving from 80%.”
Winter wheat futures trends are mixed at this time although the chart action appears to be similar. Taking a closer look…soft-red’s trend is down, while hard-red’s is up in my study of these markets. During times like this – when markets seem to disconnect – it is best to step aside until a clearer picture emerges.
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 CONDITION.
Upbeat Employment & Trade Data Not Enough for Gold Futures
Gold futures fell today to lows not seen since early last month on the outlook of positive data making the case for an interest-rate hike this year. Gold futures are down $8.60 currently at $1,185.80 per ounce (but traded to $1,180 earlier in the trading session) at the New York Commodity Exchange.
The US Commerce Department reported the trade deficit narrowed close to 20% in April exceeding analysts expectations, while in the same month US exports ticked up a full 1% and imports declined 3.3%. This information came before the payroll processing firm “ADP” stated May non-farm payrolls rose a hair above expectations to 201,000 with the economy creating 165,000 jobs.
Devin Brady, President of Progressive Trading Group in Sherman Oaks, CA, shared his view regarding the fundamental assessment of the gold futures market by stating, “With this most current information, the case is indeed made for interest-rates to be increased by the monetary policy makers (the Federal Reserve board).” Brady adds, “Fridays official employment data could be what the gold traders are waiting for to get this market kick-started.”
The trend for gold futures has been absolutely sideways for 2.5 months while technically “up” in my work. A couple more down days from here could change the trend from up to down, however – today’s/tomorrow’s lows must hold.
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 CONDITION.
Grain Futures Rise Despise Ideal Weather, Planting Progress
Grain futures are higher today on what is reportedly said to be “short covering” – traders unwinding “bets” that grain prices will fall further. Soybean futures lead the way (so far) up .15 cents for the day near their high of $5.09 per bushel at the Chicago Board of Trade.
The USDA said yesterday that most of the crops (spring & winter wheat combined), corn & soybeans have been planted, and emergence coming along greatly. Gov’t figures show corn to be the US’s biggest crop, then soybeans, and then wheat (actually behind #3 – “hay”).
Nicholas Medina, a futures and options specialist for Capital Trading Group in Chicago, shared his view regarding the fundamental assessment of the grain futures market by stating, “Some of these grain (futures) markets appear to have been ‘basing’ for some type of relief rally.” Medina adds, “It will take more market action for corn and soybeans to roll-over into an uptrend, however, and for the wheat markets to decide which way they will trend.”
As mentioned above, the trends for corn, soybeans, and CBT Wheat remain down (while KCBT Wheat is actually “up” in my work). This is the time of year when corn and soybeans rally into the fourth of July period, however, this is a different year than others with ample supply in each of these markets already a factor.
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 CONDITION.
Schad Commodity’s Trading 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: Feeder Cattle & Silver (New this week.)
DOWN Trending Futures Markets: Corn, Soymeal, Soybeans & Japanese Yen (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 CONDITION.
Domestic Planting Progress Holds Corn Futures Near Seven-Month Low
Corn futures retreated after extending yesterday’s lows to prices not seen since late September/early October on signs of speedy planting progress in the nation’s Midwest corn-belt. Corn futures have since reversed higher and are currently up .035 cents at $3.525 per bushel at the Chicago Board of Trade.
The USDA reported approximately 92% of the domestic corn crop planted as of May 24th – well ahead of the 88% five-year average. Corn emergence also spiked to 74% from 56% only the week before (well ahead of its 62% five-year average).
Kevin Craney, Director of Managed Futures at RJO Futures in Chicago, shared his view regarding the fundamental assessment of the corn futures market by stating, “The farmers have done everything they can to get ahead of this unpredictable weather, and its really reflective in the corn (futures) prices.” Craney adds, “Should the weather continue to be favorable for growing (corn), the market may also be factoring in more supply atop ample inventory.”
The trend for corn has resumed down after trading sideways for most of the month of May. No sign of a bottom at this time, but corn futures is only a mere few cents away from its October 1st low.
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 CONDITION.
Natural Gas Futures at a Crossroad in Early Uptrend
Natural gas futures is attempting a rebound from its two-week lows with traders now looking for fresh data on weekly gas inventories to have a better outlook on its demand. July natural gas futures are currently “unchanged” from yesterday’s close (near $2.85 per BTU) after a .05 cent rally earlier in the trading session at New York’s Mercantile Exchange.
Natural gas futures put in a monthly low near $2.79 and followed with a May high near $3.15 per BTU at the beginning of last week. The current uptrend in this market may be a little premature based on the weak demand and favorable weather in the near future.
Gerry Plotkin, a Senior Market Strategist for R.J. O’Brien in Chicago, shared his view regarding the fundamental assessment of the natural gas futures market by stating, “This time of year usually sees the weakest demand for natural gas as winter demand has passed and high temperatures for air-conditioning haven’t yet arrived.” Plotkin added, “Even though weather models show ‘slightly warmer than average’ temperatures across the country over the next week and a half, to me its just not enough to kick-in demand.”
Natural gas futures began an early uptrend in the second week of May, but taking out yesterday’s low of $2.818 can change the directional outlook (in my work). I think US consumers are still very much benefiting with low natural gas prices.
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 CONDITION.
New Low for May as Stronger Dollar Weighs on Crude Oil Futures
Crude oil futures have found new lows for this month with the backdrop of a stronger dollar and geopolitical concerns in oil-rich Middle East hotspots. Crude oil futures are down over $1.50 per barrel at New York’s Mercantile Exchange (as of this writing).
The US dollar is reported to have helped this crude oil move lower when it accelerated to the upside and reinforcing a new uptrend. Elsewhere, traders may be factoring-in the possibility of sanctions being lifted from Iran because if this should happen this summer (as discussed), then more oil will be added to the world glut of supply.
“It looks as if the upward steam from the March low in the crude oil (futures) market is subsiding. Eventually the fundamental picture is rightfully reflected in prices,” said Jeff Evans, Vice-President of the Managed Accounts Division for RMB Group in Chicago, regarding the fundamental assessment of the crude oil futures market. Evans added, “Traders are also standing-by for tomorrow’s domestic inventory report for further clarification.”
Crude oil futures are at a cross-road in its current uptrend. If tomorrow can manage to break today’s low, this can possibly change the technical trend to “down” in my work.
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 CONDITION.
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