May 18th, 2018 Newsletter

Silver Futures Outlook, chart and fundamentals and Trading Around Economic Reports Article.

May 18th, 2018 - Issue #920

In This Issue

1. Futures Trading 101: Trading Around Economic Reports
2. Hot Market Report: Silver Futures Tug of War
3. Economic Calendar

1. Futures Trading 101: Trading Around Economic Reports

Trading is truly a fascinating pursuit. The markets can in still excitement, frustration, irritation, exhilaration - really a wide range of emotions - conceivably, even within a single trade. Trading is definitely one of those undertakings where one has to constantly study, evolve and grow.

There are also a number of different approaches to trading, including day trading, swing trading and position trading. There are strategies that focus on just trading straight futures contracts, others solely trade options, including selling/writing options, still others incorporate long and short positions simultaneously - spread trading - utilizing futures and/or options.

One narrowly defined approach to trading - probably most relevant for day traders - is trading around economic reports.

The release of economic reports occurs almost daily. Most come from the U.S. federal government and look at national or large regional data; some come from other private surveys. Some garner considerable attention by traders; others draw barely a thought, much less a glance at their impact on the markets. This article doesn't attempt to detail any particular number of them and their significance. Rather, it lists some pointers that can help traders prepare for reports releases.

  1. Know the times reports are set for release
  2. Know which markets reports may impact
  3. Know what the markets are expecting and how different outcomes will affect market movement
  4. Do your homework, i.e., go over charts from earlier dates when similar reports were released.
  5. Keep a journal. Focus on the reports that affect the markets you trade.

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2. Hot Market Report: Silver Futures

By Matt Kang & John Thorpe, Senior Brokers

Click on image below to enlarge

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silver futures; Silver futures, along with other metals, got beat up pretty good this past week. Main reasons cited are outlook for higher interest rates along with strength of the US Dollar.
Weekly chart of Silver Futures for your review above. The market had been in a relatively narrow range for the last few months as one can see from the chart. Markets in general will rotate between periods of "narrow/ range bound trading" to periods of higher volatility, trending market. The "million dollar question" is which way and when will silver futures break?? This chart was prepared using our CQG Q trader software, which you can demo for 14 days with realtime data.
Silver Futures Specs
Hours: 5:00 PM to 4:00 PM next day PM Central Time
Margins: $3960 initial, $3600 Maint. ( as of the date of this newsletter)
Point Value: full point = $5000 ( Example: 16.80 to 17.80 ). Min fluctuation is 0.05 = $25 ( Example: 16.800 to 16.805)
Some of the basic fundamentals to keep in mind when you are considering a trade in silver futures market:
1. Research supply side in major silver producing countries like Mexico, China, and Peru.
2. Follow both the industrial demand and investment demand for silver.
3. Focus in macroeconomics not microeconomics.
4. Correlation to gold
5. Correlation to US Dollar prices
6. Inflationary prospects
7. Geopolitical Stability
8. U.S. Fiscal and Monetary Stability

Our brokers here at Cannon will be happy to chat about the SILVER market, other metals, other futures, options, futures spreads and much more! Feel free to contact us at any time.

3. Economic Calendar

Source: Moore Research Center, Inc.

Date Reports Expiration & Notice Dates
05/18
Fri
2:00 PM CDT - Milk Production
 
 
 
LT: May Coffee(ICE)
May Nikkei Options(CME)
May Russell Options(CME)
Jun Orange Juice Options(ICE)

05/21
Mon

 
 
 

 
 
 
05/22
Tue
2:00 PM CDT - Cold Storage
3:30 PM CDT - API Energy Stocks
 
 
LT: Jun Crude Lt(NYM)
 
 
 
05/23
Wed
6:00 AM CDT - MBA Mortgage Index
9:00 AM CDT - New Home Sales(Apr)
9:30 AM CDT - EIA Petroleum Status Report
1:00 PM CDT - FOMC Minutes
2:00 PM CDT - Dairy Products Sales

 
 
 
05/24
Thu
7:30 AM CDT - USDA Weekly Export Sales
7:30 AM CDT - Initial Claims-Weekly
8:00 AM CDT - FHFA Housing Price Index(Mar)
9:00 AM CDT - Existing Home Sales(Apr)
9:30 AM CDT - EIA Natural Gas Report
3:30 PM CDT - Money Supply
FN: Jun Crude Lt(NYM)
LT: May Feeder Cattle(CME)
May Feeder Cattle Options(CME)
Jun Copper Options(CMX)
Jun Gold Options(CMX)
Jun Silver Options(CMX)

05/25
Fri
7:30 AM CDT - Durable Orders(Apr)
7:30 AM CDT - Durable Goods-Ex Transportation(Apr)
9:00 AM CDT - Mich Sentiment-Final(May)
11:00 AM CDT - Cattle On Feed
LT: Jun 2,5,10 Year Notes Options(CBT)
Jun Bonds Options(CBT)
Jun Canola Options(CBT)
Jun Wheat Options(CBT)
Jun Corn Options(CBT)
Jun Oats Options(CBT)
Jun Rough Rice Options(CBT)
Jun Soybeans,Soymeal,Soyoil Options(CBT)
Jun Natural Gas Options(NYM)

05/28
Mon
MEMORIAL DAY
 
 
 

 
 
 
05/29
Tue
9:00 AM CDT - Consumer Confidence(May)
 
 
 
LT: May Copper(CMX)
May Gold(CMX)
May Silver(CMX)
May Platinum(NYM)
May Palladium(NYM)
Jun Natural Gas(NYM)
05/30
Wed
6:00 AM CDT - MBA Mortgage Applications Index
7:15 AM CDT - ADP Employment Change(May)
7:30 AM CDT - GDP-Second Estimate(Q1)
7:30 AM CDT - GDP Deflator-Second Estimate(Q1)
3:30 PM CDT - API Energy Stocks
FN: Jun Natural Gas(NYM)
LT: May Butter(CME)
May Milk(CME)
May Butter Options(CME)
May Milk Options(CME)
05/31
Thu
7:30 AM CDT - Initial Claims-Weekly
7:30 AM CDT - PCE Prices(Apr)
7:30 AM CDT - PCE Prices-Core(Apr)
7:30 AM CDT - Personal Income & Spending(Apr)
9:00 AM CDT - Pending Home Sales(Apr)
9:30 AM CDT - EIA Natural Gas Report
10:00 AM CDT - EIA Petroleum Status Report
2:00 PM CDT - Dairy Product Sales
3:30 PM CDT - Money Supply
FN: Jun 2,5,10 Year Notes(CBT)
Jun Bonds(CBT)
Jun Copper(CMX)
Jun Gold & Silver(CMX)
Jun Platinum & Palladium(NYM)
LT: May Fed Funds(CME)
Jun RBOB & ULSD(CME)
May Fed Funds Options(CME)
Jun Lumber Options(CME)
FN=First Notice, OE=Option Expiration, LT=Last Trade

Disclaimer: This calendar is compiled from sources believed to be reliable. Moore Research Center, Inc. assumes no responsibility for any errors or omissions. It is meant as an alert to events that may affect trading strategies and is not necessarily complete. The release dates for certain economic reports may have been rescheduled.

* Please note that the information contained in this letter is intended for clients, prospective clients, and audiences who have a basic understanding, familiarity, and interest in the futures markets.

** The material contained in this letter is of opinion only and does not guarantee any profits. These are risky markets and only risk capital should be used. Past performances are not necessarily indicative of future results.

*** This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts herein contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgment in trading!

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