Commodity Futures Higher on Fund Bets

In the past week, we have seen more bullish speculation from money-managers and funds in what they believe will be the next economic stimulus from the federal reserve.  The bullish posture has help stop a slide in commodity prices and help prop-up gold prices in it’s longest rally since last summer.

The Commodity Futures Trading Commission data revealed 18 specific commodity futures markets that have nearly 10% more “net-long” since this time last week.  These same commodity markets just two weeks ago were realizing their lowest levels of the year (“yearly lows??”).

The rise in prices of major commodities over the last three trading sessions are signaling that the (futures) market expects some type of quantitative easing from the (federal reserve) in the short term. The commodity markets are always the beneficiaries of central bank intervention when it happens and most of the funds out there seem to believe this will happen,” stated Chris Hildebrand, vice-president of trading at HighGround Trading Group in Chicago, regarding the current commodity futures situation.

The majority of the commodity futures markets we trade – specifically the agricultural futures markets – are in some type of weird sideways trend as of recent.  I am specifically looking for trading opportunities in pull-backs of their dominant trends, and/or lower-risk trades.  There are no breakout commodity markets with runaway trends just yet…but summer hasn’t officially begun yet.


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