Archive for the ‘Silver Futures Trading’ Category

Last month was the biggest slide lower for gold futures and silver futures in over two years, but investors are still said to still have $102B in the market looking for higher precious metals prices.  There is just as much gold being hoarded than the world’s central banks (in the US, that’s the Federal Reserve), and supposedly more silver than the US can mine in 12 years time!

Silver (futures) experts expect silver to rise in price practically 25% by the end of this year, and gold at least 20%.  Swiss experts are predicting the strongest demand for silver in over 20 years, and the second-most sales of exchange traded gold ever recorded.

Fund-manager Michael Cuggino, from San Francisco, said today “Some investors have taken money off the table after a significant run-up in 2010.  If you look at the macro-environment, the instability around the world, the world-wide currency devaluation, these factors all bode well.”

I actually have the trend for both gold futures and silver futures as “down” at the moment, but am only interested in trading the long side when the market “proves itself” strong once again.  Let the gold & silver futures markets come to us…

CEO Barry James of his namesake’s research firm spoke out against silver prices today by predicting a 20% correction due to the “crowd” of bullishness revealed in more than ample coin sales.  Silver futures are on the verge of a trend change following a change in trend to the downside for gold futures just today (in my work).

Over 4.5M “American Eagle” 1-ounce silver coins have already been sold this month, and a new record of sales is expected by the end of the month.  It appears investors are turning to the “more affordable” precious metal as it hovers near its 30-year high.

In a statement today, James says “The coin sales are an indication of the level of interest in silver.  It’s too popular…When the crowd discovers a good deal, it’s usually long over.”

Silver futures have doubled in the past two years and have gained in the past eight of nine years.  Let’s look for a change in silver’s trend to catch on the downside…

Look for immediate changes to our precious metals futures trading.  Although we are not trading any precious metals tomorrow, you will notice changes in the trading plan starting today.

It’s happened twice in just the past couple of weeks – our protective stops are getting “passed over” by the LIFFE commodity exchange in London when trading mini-gold futures and mini-silver futures contracts.  Just this past Friday we had entered the trading session long the mini-gold futures with a protective stop at 1366.4, but the market filled only few of us at 1366.0 and filled me and others at/near 1351.0.  This is not acceptable by me, and should not be for you either (especially in the electric markets).

One of my commodity trading brokers at MF Global in Chicago, Kevin Riordan, said today in e-mail correspondence when we were considering switching over to the CBOT mini-gold futures contract, “The CBOT mini-gold futures is just awful (with just) 29 contracts of volume, so that’s not the answer.  One alternative is to trade the big gold futures contract for clients already on the books trading two-lots (or more)…otherwise, we need to end it.”

I agree.  I will not continue to trade the LIFFE products with their “progressive rules” that seem to change too often for my liking…always in their favor.  Starting today, please know we will be trading big-gold futures and big-silver futures for clients trading $50K & $100K portfolio’s (or higher) prospectively.

A London-based research firm is publicly stating they expect silver prices to top $30 next year from investor demand for the precious metal as a hedge against inflation.  Silver futures are once again “northbound” and we are are long with the trend.

The cash price next year – projected to average $28 per ounce – will be nearly double of it’s 2009 average spot-price of $14.70 per ounce.  The projected demand for fabrication and industrial demand for this year was expected to send silver prices to all-time highs, but that scenario never materialized.

The London-based research group, GFMS, said today “The main driver of (silver futures) the price remains investor demand…and investors will be of a mood to absorb the resultant, growing surplus as key supports such as ultra-low interest-rates, a weakening dollar and a bouyant gold market should remain with us.”

So far this year, silver futures have climbed 22% for a tenth straight year of gains.  We just went long again today as silver futures are testing its recent highs.

Since the very beginning of December 2009, silver futures have been struggling for direction between $15 and $20 per ounce.  The overall trend is up, however, the question now is what will it take for silver to breakout above $20…?

Barclay’s technical analyst, Jordan Kotick, reports “Silver continues to struggle against the confluence of resistance between $17.48 and $17.63.  Prices may climb toward the December 3rd high of $19.46 if the resistance levels are breached, otherwise the ‘focus’ will remain on a month-long trend line at $16.46.”

After a 48% gain in silver futures last year, silver is little changed year-to-date.  December’s high was the highest the metal had traded in 16 months.

As mentioned above, the trend for silver futures remains up and we are looking for buy signals at this time.  The same goes for gold…quiet market lately, but one of these days the possibility exists for both of these markets to get long and away it can go!

Once each week, usually on Friday evenings, I update my 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 my 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, I monitor them on a weekly basis. Although the futures markets themselves will ultimately provide the most accurate illustration of trend, these (weekly) charts that I have identified, serve to forewarn us of the next possible bigger move.

Here are the markets which illustrate the bigger picture changing for them:

UP Trending Futures Markets: Sugar, Lean Hogs, Russell 2000, Cotton (New this week.)

DOWN Trending Futures Markets: Soybeans, Wheat, Silver, Soy Oil, Corn, Kansas Wheat, and Euro-currency – these last five all new this week.

To see “An Insider’s View of the Next Big Market Move,” find your way to http://SchadFutures.com | Contact Us and fill in the form on the right-hand side. What are you waiting for…? It’s FREE!

We’re just three weeks into January.  Let’s  highlight this week’s three BEST trades…and the worst three.

Here they are…The winners:

Sugar - $996.80 per contract score!

Live Cattle – $950 per contract score!

mini-Silver – ($75) per contract loss.

…and the losers:

Lean Hogs - ($280) per contract loss.

Soymeal- ($110) per contract loss.

mini-Silver- ($75) per contract loss (as above – only five ‘closed’ trades this week).

Follow my trades each and everyday at SchadFutures.com | Track Record – See you there…

PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. Informational purposes only…Not intended for solicitation of securities.

Gold futures set a new record today reaching $1,084 per ounce after India’s central bank announced it would purchase 200 metric tons of gold bullion, and the US Dollar – while higher earlier in the trading session – pared back its gains. Silver and other precious metals also closed higher for the day, but in a change and “decoupling” of recent patterned activity both the dollar and gold rose while the stock market declined.

“The reason for the gold move today is mostly India’s purchase,” said Doug Keller, managing director at Binary Research (a commodities research firm). Keller went on to say, “Any further strengthening in the dollar would probably cap gold (gains) in the short term.”

Helping to boost precious metals today, the US Commerce Dept. reported a rise in factory orders almost a full percent in September, which is the fifth increase in the past six months and more than our economists had expected. Before we get too bullish gold, be forewarned analysts at Credit Suisse feel further risks to gold are seen tomorrow when the Federal Reserve convenes to consider near-term interest-rates.

After five straight losing sessions, gold has begun its come-back closing up nearly $20 an ounce – a 2.6% rise (at $1,048.1 per ounce as of this writing) in Thursday’s electronic trading session. Crude oil has come back to life as well reaching well into the $80 per barrel range after the US Commerce Department signaled the domestic economy has rebounded and is indeed expanding for the very first time in a year.  The December Silver futures contract rose with slightly more volatility up 3.2% closing at today’s electronic session at $16.67 per ounce.

Today’s news that the US GDP rose at an annual pace of 3.5% in the 3rd quarter – the strongest growth in two years, mind you – brought investors back into commodities and stocks.  Says George Gero, a VP at RBC Capital Markets futures division, “It’s the better economic figures, better oil and better moving averages in gold that are supporting prices (today).”

The third contributor to today’s action, the US Dollar Index, fell sharply after six sessions of gains and appears to be on track with its overall downtrend.  The combination of these three big market movers contributed to gains in all other markets we trade: sugar, cotton, livestock, and grains. All of our markets appear to be on track with their overall up-trends.