Financials: Mar. Bonds are currently 10 higher at 143’05 and the 10-Year Notes 4 higher at 131’08. This morning the Bonds have rallied slightly more than a full point (1’00) off the overnight low of 142’05 (a new recent low) after a break in equity futures around 7:00am Chicago time. For the moment I am going to keep support at 142’19 given the rally off of recent lows and keep resistance in the 145’24 area. As mentioned Friday I am on the sidelines awaiting the market to trade at one of the extremes of support and resistance preferring the short side of the market on strong rallies as my bias remains long term negative. For short term traders, now that the market has made new recent lows and rallied above Friday’s settlement, consider buyer breaks with protective sell stops just below the overnight low of 142’05.
Grains: Mar. Corn is currently 1’0 higher at 737’0, Mar. Beans 12’6 higher at 1487’0, Mar. Wheat 3’6 higher at 768’6 and Dec. Wheat 3’0 higher at 807’0. Friday Mar. Corn made a new recent high at 746’2 only to fail to close above the 742’0 level (the market closed 4’4 lower at 736’0) that I feel this market needs to do to indicate a move above the 750’0 level. At the moment I am looking at Mar. Corn as a trading affair between 725’0 and 745’0. I still like being long out of the money call spreads in Dec. Wheat as a long term position.
Cattle: On Friday Apr. LC closed at 132.17 down 62 points and Mar. FC closed 35 lower at 149.20. Friday’s break gave us the opportunity to go long Apr. LC in the 132.00 area and we will use a protective sell stop at 130.90 for the moment. If the market trades above 132.75 either take the short term profit or raise your sell stop to the 131.45 level.
Silver: Mar. Silver is currently $0.39 lower at $31.57 and Apr. Gold is $6.00 lower at $1,664.00. We remain long Silver. We recently took profits from long Gold positions putting us on the sidelines at the moment. For the near term support is $1,653.00 and resistance $1,682.00 even. Over the last few weeks we have traded from the long side of the market on breaks to the $1,657.00 level somewhat successfully anticipating a close above the $1,668.00 level, which I felt the market needed to indicate higher prices. To be honest I am not impressed with the recent action and am going to sit on the sidelines and see what develops. If the $1,653.00 is penetrated I anticipate a break to the low $1,640s.
S&Ps: Mar. S&Ps are currently 8.00 lower at 1498.75. On Friday this market made a new multi-year high of 1510.75. I still stubbornly retain a small short position. Support is currently 1483.00 and resistance 1510.00.
Currencies: As of this writing the Mar. Euro is currently 94 lower at 135.71, the Swiss 28 lower at 1.0995, the Yen 11 higher at 1.0796 and the Pound 21 higher at 1.5734. We have gone long the Yen between the 1.0755 and 1.0800 even level with an initial 100 point risk. To be honest, this trade is certainly against conventional wisdom that says , given recent comments from the Bank of Japan, Japan is determined to push the Yen even lower against the dollar (some say eventually 100 to the dollar) and invert their yield curve. The overnight low in the Yen was 1.0734. Given that I’m just looking for a bounce to make a small profit, raise your sell stop to the 1.0723 level. If the market trades above this morning’s high of 1.0815 either take profits or raise your sell stop once again to the 1.0770 level.