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Weekly Futures Report

Crude surges in price over the past five sessions to its best level in nearly 3 months 

8.04.10 Filed Wednesday 7:15 pm

ALL CHARTS THIS WEEK ARE Daily Bars

Last Last Week

September Crude 82.43 76.46

September Heat 220.05 201.78

September Gas (Blended) 217.50 206.49

Crude oil surged in price over the past five sessions to trade at its best

level in nearly three months. The ADP private job creation forecast

came in higher than expected and this gave support to the market. Also,

the Institute for Supply Management also indicated better than

expected job growth in the services sector of the economy. In a related

development, gasoline inventories climbed to their highest levels in three

years. Oil had gained over 7% in value over the previous 4 sessions.

Gasoline stocks increased by 729,000 barrels to 233 million barrels for

the latest reporting week. The trade had been looking for a drop in

supplies of one million barrels. On this news, gasoline came off in price,

actually declining for the first time in six trading sessions. Most in the

trade believe that supplies of crude and its products are more than

ample. Many further believe that crude’s recent run isn’t entirely

validated by true supply and demand fundamentals. Refinery runs are

up, supplies are up and demand is tepid. A weaker dollar over the past

several sessions was also supportive. The Yen was trading at a 15 year

high against the dollar on Wednesday morning. A real contributor to

future oil prices will be the US unemployment report scheduled for

release on Friday as it provides a metric to gauge the relative strength

or weakness of the general US economy.

Support Resistance

September Crude 80.50 83.50

September Heat 213.70 223.00

September Gas 215.00 222.00

***********************

METALS

Last Last Week

December Gold 1197.70 1163.60

Sept Silver 18.28 17.515

Oct Platinum 1583.50 1541.70

Gold closed higher on short covering as the market managed to reverse

its intermediate trend and flip to positive. Buying intensity picked up as

prices pierced $1200.00 and stops were hit unleashing more buy orders

into the market. Better than expected US economic data encouraged

buyers. A Wall Street Journal report earlier in the week suggested that

the Federal Reserve may enter the markets to buy back government

securities thus injecting the system with more cash and liquidity which

could eventually lead to inflationary pressures. Also, Mideast demand

for gold in the physical market remains good due to seasonal

considerations. On the move, gold hit a fresh two week high while

backing off to close mid range. Another positive for the gold market was

news that China will allow its banking sector to increase their activity in

the gold market beyond the current five banking institutions allowed to

import and export the metal.

Silver had a bearish price performance on Wednesday by making a

higher high, a lower low and a lower close than the preceding trading

session. This outside reversal day is a technical warning.

Support Resistance

December Gold 1175.0 1210.00

Sept Silver 18.15 18.74

Oct Plat 1567.00 1617.00

*********************************

SOFTS

Last Last Week

September Coffee 169.75 167.40

October Sugar 18.90 18.87

Coffee saw some selling pressure after rallying to a twelve year high.

Global coffee output is expected to expand by 12 percent to 135 million

bags for the next Brazilian crop year which begins October 1st.

Sugar rallied after a two day price drop. Buyers thought that prices had

fallen far enough to encourage physical buying. Consumption on a

global basis is still expected to outstrip supply by 8.5 million metric tons.

Support Resistance

September Coffee 164.50 171.50

October Sugar 17.75 19.50

*****************************************

Last Last Week

November Soybeans 10.242 9.78

December Corn 4.15 3.906

December Wheat 7.554 6.47

Soybeans have been strongly supported by an increase in demand as a

drought has reduced production of crops in Russia and the Black Sea.

Russia is considering limits on grain exports after the worst drought in

50 years has stressed crops and limited production.

Wheat soared to 22 month highs on concern that Russia, one of the

world’s largest exporters of wheat, would cut back to conserve wheat

for domestic consumption. Russia has yet to sell grain from government

stockpiles but this seems like a matter of when not if in terms of

scheduling. Speculative buying is exacerbating the situation. Egypt was

a big buyer of Russian wheat in the cash market, probably fearful of a

proposed ban. Hot, dry weather persists and may delay August

plantings for winter wheat.

Corn has surged 21% since June due to weather related issues. US

farmers planted less corn this year than last. Until weather models

dictate, it’s best not to attempt the short side of this market.

Support Resistance

Nov Soybeans 9.90 10.75

Dec Corn 3.945 4.25

Dec Wheat 7.00 8.00

Chuck Kespert from NY/NY

HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT

LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO

REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS

LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN

FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN

HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS

SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM.

ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS

THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF

HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE

FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN

COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL

TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO

ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING

LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT

ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS

RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF

ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY

ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL

PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT

ACTUAL TRADING RESULTS.0000

 

 

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