Grains position themselves ahead of monthly crop report

Financials: Mar. Bonds are currently 3 lower at 143’14 and the 10 Yr. Notes 2 lower at 131’17.5. Weekly Jobless claims were down 5,000 at 366,000 vs. expectations of down 11,000. Non-farm productivity was slightly below expectations coming in at -2.0% vs. pre-report estimates of -1.5%. Continue to treat as a trading affair between 142’19 and 145’24.

Grains: Mar. Corn is currently 4’4 lower at 718’4, Mar. Beans 4’0 higher at 1491’4, Mar Wheat 1’0 higher at 762’4 and Dec. Wheat 2’6 lower at 793’6. We tried the long side of Mar. Corn from the 725’0 level only to be stopped out with a small loss when the market slipped below the 722’0 level. The next area of support will be the 707’0-712’0 levels. Tomorrow morning at 11:00am (Chicago time) we will have the monthly Crop Report. I do not expect any surprises and will be willing to go into the Report with a long position from the stated area of support if the market allows. Current support and resistance for Mar. Beans remains at 1460’0-1500’0. We continue to hold out-of-the-money call spreads in Dec. Wheat.

Cattle: Apr. LC are currently 12 lower at 131.32 and Mar. FC 25 lower at 147.30 after closing lower yesterday. My recommended protective sell stop for any remaining long positions in Apr. LC was breached when the market traded through the 131.45 level. Of note: The chart gap in Apr. LC of 131.35-132.05 made on Jan. 28 has been filled with yesterday’s low of 131.15. I am currently on the sidelines.

Silver: Mar. Silver is currently $0.05 lower at $31.82 and Apr. Gold is $2.00 lower at $1,677.00. We remain long Silver. Continue to treat Gold as a trading affair between $1,657.00 and $1,688.00.

S&P's: Mar. S&P’s are currently 0.50 lower at 1506.25. I still feel this market is overbought and retain my negative bias at current levels. Support remains at 1492.00 and resistance at 1510.00 for the short term.

Currencies: As of this writing the Mar. Euro is currently 34 lower at 1.3495, the Swiss 25 lower at 1.0971, the Yen 6 lower at 1.0701 and the Pound 37 higher at 1.5700. As I am writing this Report the euro is breaking despite comments from Mario Draghi of the ECB that rates will be left unchanged and that the recent appreciation of the euro is a sign of confidence in the Euro. Technically a close below 1.3450 will generate a sell signal.

About the Author
Marc Nemenoff

Mr. Nemenoff is a 40-year veteran of the futures industry. While attending graduate school at the Illinois Institute of Technology, Marc took a job as a clerk on the trading floor of the Chicago Mercantile Exchange. Over the years he grew to become an independent member of the exchange and spent many years as a trader, market maker, lecturer, and committee member. Since 2004 Marc has been a senior broker and analyst handling customer accounts for both speculators and hedgers in addition to institutional traders. Marc is also the author of The Nemenoff Report, a daily overview of the markets that includes his own perspective on market direction. Mr. Nemenoff describes his approach to the market as 75% technical and 25% fundamental and is also a firm believer in the use of option strategies as a way of using leverage and minimizing risk when one has a long-term market strategy. You can contact Marc by phone at (888) 908-4310 or by email at mnemenoff@pricegroup.com. Learn even more on our website at www.pricegroup.com.

Futures and options trading involves substantial risk of loss and may not be suitable for everyone. The information presented by The PRICE Futures Group is from sources believed to be reliable and all information reported is subject to change without notice.

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