Our Futures Trading Results. Week 20 2022
Our results of the week
+$36,788 profits. This is the net result of the past trading week. By realizing this amount of money we could make a new all-time high across our accounts. While the stock market index of the S&P 500 is decreasing in price for weeks we make money by trading commodities.
Let’s start with the COT strategy first. We started into the week with two open positions, namely eight long contracts and Cotton and one long contract in Gasoline. Both of these trades were very well in the win during the week. We didn’t open any new positions. Instead we closed the existing open positions. Let’s have a look at the trades individually. First market is Cotton. On the weekly chart we received a buy signal in the weekly trend direction. We can see that the trend continued to the upside contra to what the seasonal trend indicated. Thus we could derive that there’s relative strength in the Cotton market. On the monthly chart of Cotton you can see the past high and that indicates where the price of Cotton can rise to. On the daily chart you can see that we traded this market twice, the first trade was successful, then there was a correction and we used the correction to enter the market again because we expected a trend continuation. We adjusted our stop loss and exited the market on Wednesday because we expected a further correction and that actually appeared as you can see here. With this trade we made a profit of +$24,440. All together this trading idea brought us on the December contract of Cotton a total gain of +$44,440. Next market is Gasoline. On the weekly chart you can see that we received a buy signal in the weekly uptrend direction. On this chart you can see that the resistance level has been reached that developed across 2007 and 2008. Because of this key resistance level we decided to exit the trade on Monday shortly after waking up. With this trade we made a total profit of +$13,813.
Let’s have a look at our champion strategy the champion strategy. It is based on COT data as well but is more suited for experienced traders that have high focus and can handle a higher frequency of trading opportunities. We started into the week with an empty portfolio in the strategy and at the end of this week we have two open positions, namely one in Rice and another one in Soybeans. During the week we had another trade in the 10-Year T-Notes and this trade brought us a total loss of -$8,205. However we still have two open positions in the portfolio and those are very well in the win. Let’s have a look at the trades. As mentioned the trade in the 10-Year T-Notes was not successful. As you can see the daily trend is a downtrend and we expected that the trend continuation to the downside will realize. As you can see while we have been conducting our short trades the market began a trend reversal. We were stopped out twice and because of that for now we keep on the sideline and if the price actually turns around into the trend continuations direction to the downside then we will be interested again. Next market is Rough Rice. It’s still an open position we are in the market with 12 contracts and we speculate on a price continuation to the upside. We used the correction to enter this market and in our opinion Rice is heavily undervalued. We base our market opinion on the zero interest rate policies, on China’s COVID related policies including shutdowns of Chinese harbors, as well as India’s export grains stop. All these factors confirm our expectation of Rice’s trend continuation to the upside. Next market where we have an open position in is Soybeans. This is a very speculative trade. We’re in this market only for a short time. As you can see on the daily chart it looks like a range market. On the weekly chart however before this range market appeared there was a strong uptrend and because of that we decided to enter the market with a long position. However the price reaches soon the upper resistance level of the range market. This trade was also based on fundamental news about frost in Brazil that should also have upwards price pressure on Soybeans. Nevertheless this effect didn’t realize in the market price. Furthermore the resistance level as mentioned before is near and as this trade has been planned to be a short-term trade anyways we want to exit the trade in Soybeans on Monday.
Our third strategy is based on weather trading. In our weather trading account we combine COT data with fundamental extreme weather analysis and as you can see in this week we made a total gain of +$6,740. We have three open positions, namely two commodity stocks and a position in Rough Rice. Let me show to you the rationale behind these trades. For the weather trading strategy we utilize weather trading maps and for example news like this that India has restricted the export of grains products. On this chart you can see our trades in Rice. In this week we realized a trade where we made +1,580 profits but as you can see we were exposed to a huge slippage and because our stop loss was below the low of Monday our slippage was high. Nevertheless our expectations for Rice as mentioned before are positive, we expect to see further increasing prices based on the massive undervaluation of Rice compared to other grain markets. Because of that we re-entered this market. Another important event for us is the Atlantic hurricane season for this year. Here you can see that the number of tornadoes in the US are above the average. We’re using two commodity stocks in order to trade based on this fact. You can see that both of these stocks are in the loss. Nevertheless compared to the decreasing S&P 500 those two markets show relative strength to us very clearly. Furthermore we received news that there are wildfires in Texas, in New Mexico, and in Colorado. These wildfires are probable to have influence on the commodity markets. In the next week we will create a trading plan to trade the upcoming price moves.
At the end let’s have a look at the commodity price index as usual. This is the CRB index. The price is still around the resistance level from the past. The price index however didn’t bounce back but stayed around the resistance level and because of the strong uptrend in the past months we expect CRB index to increase further more. As a consequence we expect commodity prices to increase.
HERE you can find a summary of all individual trades and a comparison of the results of both strategies:Our track record from 2014 to present
Thank you for your attention and we wish you successful trades for the next trading week.
Max Schulz and
the InsiderWeek team