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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:
Foreign Exporters & Domestic Ranchers Helping Push Wheat Futures Lower
Wheat futures is playing a cruel joke on our domestic farmers despite having the smallest crop harvested recently for the past three years. Wheat futures are finding lower prices because of outside factors such as surging wheat output overseas and a switching in feed in domestic use.
Now that feed prices have come back down to reality, US cattle ranchers have resumed using more corn in their livestock’s feed – which makes sense. What makes more “cents” is the fact our strong US Dollar is promoting other nations to look for wheat supplies elsewhere where the supply is much more plentiful – and less expensive.
“The obvious choice for wheat importers are to buy where their currency is the strongest, and wheat supplies abound,” said Barb Levy, chief director for The Fox Group’s futures division in Chicago, shared her fundamental analysis insight regarding the current wheat futures situation. Levy added, “As long as our domestic wheat prices remain uncompetitive, we can expect lower (wheat) futures prices.”
The trend for wheat futures is down with no bottom yet in price. I will need some type of relief rally before getting short wheat futures.
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.
Crude Oil Futures Poised for Further Drop on Iraqi Oil Surge
Crude oil futures are hovering just below $45 per barrel and appear for a breakout lower with the forthcoming revelation. The whole breakdown of crude oil prices from OPEC members competing for global customers is about to accelerate with Iraqi oil production.
Oil production from Iraq is actually said to be climbing from a 35-year high as the southern oil fields remain untouched by ISIS militants, and adds a growing supply of oil from the Kurdish region (up north) to its exports. To match buyers with the added production will mean only one thing – offering more attractive incentives to buy than competing rivals of the OPEC nations.
“We have been led to believe the price war of crude oil has been between the US and Saudi Arabia, but now we are realizing perhaps the bigger explanation with an inter-OPEC rivalry,” said Laura Taylor, a senior market strategist at RJO Futures in Chicago, shared her fundamental analysis insight regarding the current crude oil futures situation. Taylor added, “All OPEC members have defended their market share (by cutting prices), but with Iraq adding volume to inventory can lead to another leg down in crude oil futures.”
Crude oil futures trend is down with no clear bottom in sight. A decisive move below $45 per barrel can send crude oil futures to its next support level of $40.
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.
With Chinese Growth Seen Slowing, Copper Futures Near Five-Year Low
Copper futures is realizing the repercussions of the world’s largest industrial metal consumer’s industrial production slowing down. China’s industrial growth has seen its smallest gain in almost 15 years and copper futures is reflecting revelation currently down 900 points in New York’s Commodity Exchange.
Chinese government data reports last year’s metal-consumer’s earnings may have increased, albeit a meager 3.3%, but last month profit slid by 8% – the third straight month of declines. To make matters worst for copper futures, here in the US durable goods orders also fell for the fourth consecutive month and the US is the second biggest user of copper.
“Copper prices are getting a one-two punch from the world’s top end users of the (industrial) metal,” said Nicholas Medina, a futures and options specialist for Capital Trading Group in Chicago, shared his fundamental analysis insight regarding the current copper futures situation. Medina added, “Copper futures seem to be looking ahead to demand and it’s just not there.”
The trend for copper futures is nothing but down with new lows made just yesterday. We had a couple of copper futures trades earlier this month, but I need volatility to contract some before getting short this market once again.
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 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: Gold and Silver
DOWN Trending Futures Markets: Copper, Natural Gas, Lean Hogs, British Pound, Euro-FX, Feeder Cattle and Cotton, Coffee, Sugar, Japanese Yen, Soy Oil & Soymeal (These six 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.
Corn Futures Lower on Int’l Grain Council’s Supply Outlook
Corn futures are down for the second trading session in a row following the Int’l Grain Council’s speculation that global corn output will exceed another forecast from November. The improved prospects for more corn output is due to South American production which raises the corn estimate for an eight time now.
The London-based group claims that larger corn crops around the globe will put inventories at the end of this current season to levels not seen in 30 years. The group made this claim when they realized corn farmers will reap nearly 10M tons more than previously forecasted.
“Despite the solid rise in consumption, corn futures are reacting to global competition and more than enough supply,” said Nicholas Medina, a futures and options specialist for Capital Trading Group in Chicago, shared his fundamental analysis insight regarding the current corn futures situation. Medina adds, “To know all these factors, plus the US Dollar at high levels not seen since 2009 (a high-dollar is bearish for US exports) still lead to 30-year high stockpiles is very bearish for corn futures.”
Corn futures trend is technically “up” in my study and research. This can all change for corn futures if they were to take out $3.75 per bushel this week. We’re about a dime higher as of this writing.
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.
Forecasts for Bitter Cold Halt Natural Gas Futures Near Lows
Natural gas futures seem to be defining a support-base in this most recent down-trend due to forecasts bitter cold weather returning after the mild weather many have been enjoying this week. Natural gas futures are fluctuating around the $2.90 per btu’s today in New York’s Mercantile Exchange.
Later this month and into February, two-thirds of the eastern portion of the USA is predicted to have “below normal” temperatures while the low in Chicago is expected to be 5 degrees lower than normal sometime during that period. The low’s in New York are predicted to be as much as 11 degrees lower than normal. This has the potential to halt falling natural gas prices which crashed last month.
“Natural gas futures traders are taking a hard look at the forecasts for the end of the month and beginning of February,” said Kevin Craney, Director of Managed Futures at RJO Futures in Chicago, shared his fundamental analysis insight regarding the current natural gas futures situation. Craney added, “If last week’s low can hold, we can easily see a return to the mid-$3.50 level of natural gas futures.”
The trend for natural gas futures is down with clear basing action in progress. Not only does natural gas futures need to hold last week’s low, but a breakout above last week’s high of $3.30 will be in order.
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.
Gold Futures Reach Five-Month High on Obscure Growth Outlook
Gold futures have reached a five-month high in early morning trading on the outlook of a safe-haven hard-asset amid speculation of sputtering global growth. Gold futures are currently at $1,288 per ounce (up $11) in New York at the Commodity Exchange.
Over the long weekend, in Washington, DC the Int’l Monetary Fund released an aggressive retraction of their global growth forecast of the past three years. They claim a worldwide slowing of growth (except for here stateside) and that it will “more than offset” the expansion boost offered from dwindling crude oil prices. Also recently, the Swiss National Bank shook the markets last week ending a cap to their currency against the Euro which initiated this leg up for gold futures.
Kevin Riordan, director of research at Capital Trading Group in Chicago, shared his fundamental analysis insight regarding the current gold futures situation by stating, “Several factors have contributed to this rally in gold we’re seeing.” Riordan added, “More decisions from the European Central Bank are forthcoming and gold, once again, is the current safe-haven for investors.”
Gold futures trend is up with no top yet in sight. I am concerned with the lack of follow-through with gold futures bulls this morning and feel a correction is due…
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 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: Gold and Silver & Soybean Oil (Both new this week.)
DOWN Trending Futures Markets: Crude Oil, Copper, Natural Gas, Lean Hogs, British Pound, Euro-FX and 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 CONDITION.
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