Financials: Sept. Bonds are curently 16 higher at 150'01 and the 10 Yr. Note 7.5 higher at 134'04.5. Friday's Unemployment Report showed an increase in non-farm payrolls of 163,000 vs. expectations of an increase of 95,000. This in addition to renewed possibilities of Quantitative Easing in Europe helped the Bonds break more than 2'00 removing some of the "flight to quality" premium built into this market. As mentioned over the last few weeks I consider a close below the 150'00 level a sell signal. That being said, I caution against selling into this market on breaks and recommend waiting for rallies to initiate short positions. For the near term support is the 149'08 area and resisitance the 151'00 level. If the Bonds are too volatile for you, consider going short either the 10 year or 5 year notes on rallies.
Grains: Dec. Corn is currently 9'4 lower at 798'0, Nov. Beans 41'0 lower at 1588'0 and Dec. Wheat 6'6 lower at 897'0. Cooling temperatures and some spotty percipitation is pressuring Corn this morning. The prevailing trend remains up, however, the market has developed resistance in the 815'0 area. Support remains in the 784'0 area and I will once again try the long side on a break to support with an initial protective sell stop at 772'0. Possible top in Nov. Beans.
Cattle: On Friday Oct. LC closed 72 lower at 124.37 and Oct. FC 190 lower at 140.12 as Corn prices rallied sharply off of early lows. With Corn prices lower this morning I expect Feeders to gain on LC this morning. Continue to treat Oct. FC as a trading market between 138.00 and 144.00 with a bias to the long side of the market on breaks. I will be a buyer in Oct. LC between 122.50 and 133.50 with a 2.00 point risk.
Silver: Sept. Silver is currently 14 cents lower at 27.66 and Dec. Gold2.00 higher at 16.115. We remain lightly long Silver. Continue to treat Gold as a trading affair between 1585.00 and 1625.00.
S&P's: Sept. S&P's are currently 2.00 higher at 1391.00. Friday's Jobs Report which showed a better than expected increase in non-farm payrolls rallied the market to new recent highs erasing the earlier in the week break to the 1350.00 area. My bias remains to the short side, however, closes above the 1396.00 level will send me to the sidelines.
Currencies: As of this writing the Sept. Euro is currently 13 higher at 1.2395, the Swiss 15 higher at 1.0324, the Yen 45 higher at 1.2773 and the Pound 74 higher at 1.5573. On Aug. 2nd I retreated to the sidelines in the Euro and cautioned against downside potential as the market traded below the 1.2200 level. Since then there have been comments from the ECB and Germany which has given the hope of some kind of European stimulus package or Quantitative Easing. I remain on the sidelines.
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