Bonds fluctuate on news out of Cyprus

Financials: June Bonds are currently 11 lower at 143’08 and the 10 Yr. Notes 5 lower at 131’11. Bonds have been gyrating over the last few sessions on just about every news item out of Cyprus. Since Monday the Cypriot congress voted against levies on bank deposits and have been in talks with the Russians about assistance in raising the €5.8 billion needed to secure an additional €10 billion bailout for potential recapitalization of banks. The nervousness of the market is not necessarily the failure of Cypriot banks but the systemic problems that could arise with the precedent of a levy on bank deposits in general. If you went short at Monday’s stated resistance of 143’28 (recent high 143’30) take the short term profit.

Grains: May Corn is currently 3’0 higher at 731’0, May Beans 10’0 higher at 1416’6, May Wheat 9’0 higher at 731’0 and Dec. Wheat 7’6 higher at 746’2. We remain long out-of-the-money call spreads in Dec. Wheat. Interestingly May Corn and May Wheat are now at even money, this spread should be watched for a breakout in one direction or another. Personally I’m leaning toward Wheat gaining on Corn but not as yet willing to take a position. May Corn is approaching long term resistance above the 740’0 level, an area where I am willing to try the short side of the market.

Cattle: Live and Feeder Cattle continue their recent slide this morning with Apr. FC down 67 points at 139.72, Apr. LC 10 higher at 125.40 and June LC 10 lower at 120.87 each at or near contract lows. Long term support for Live Cattle is the 118.00 area, levels last traded in Aug. and Sept. 2012. I will be a buyer in June LC below the 118.75 level.

Silver: May Silver is currently is currently $0.05 lower at $28.82 and Apr. Gold (next week we will be quoting June Gold) is $3.50 lower at $1,607.80. We remain long silver. Gold has turned up for the short term with support now in the $1,592.00 area where I will be willing to try the long side of the market with a 10.00 risk.

S&Ps: June S&Ps are currently 8.25 higher at 1550.50. Support is currently 1536.00 and resistance the 1557.00 area. Treat as a trading affair between support and resistance.

Currencies: As of this writing the June Euro is trading 63 higher at 1.2947, the Swiss 36 higher at 1.0600, the Yen 49 lower at 1.0472 and the Pound 39 higher at 1.5133. The June Dollar Index is currently 31.6 lower at 82.896. Possible toppy action in the Dollar Index. Short term traders might consider going short the Dollar Index on a rally with a protective buy stop at 83.47.

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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