Financials: Dec. Bonds are currently 13 higher at 142'06 and the 10 Yr. Notes 4 higher at 130'18. The flight to safety continues as the market worries about the impending rollover of some shorter term Italian debt. The market is also considering the implications if the Italian 10 Yr. Note once again pops over the 7.0% yield level. Support remains at 140'05 and resistance 143'05. I am still recommending the short side of the market above 142'26 for short term trades only with a limited risk of about 20 tics (a stop in the 143'14 area).

Grains: Yesterday Jan. beans closed 2'6 higher at 1178'2, March Corn 4'4 lower at 643'2 and March Wheat 7'6 lower at 638'2. Over night Beans were 15 higher, Corn 3 higher and Wheat fractionally lower. Some decent rumored export numbers in Beans have helped lift both Beans and Corn this morning. I am on the sidelines.

Cattle: Yesterday Dec. LC closed 45 lower at 120.10 and Jan FC 12 higher at 145.80. We have covered all short Dec. LC positions putting us on the sidelines at the moment. My bias remains negative on Live Cattle but I feel the market is too near support in the 119.00 area to hold positions at the moment. Starting tomorrow I will be looking at Feb. LC.

Silver: Dec. Silver is currently 70 cents higher at 34.72. Continue to hold out of the money calls and/or call spreads for March 2012 expiration.

S&P's: Dec. S&P's are currently 2.00 lower at at 1250.50 after having been as much 18.50 lower overnight at 1234.00. The market is very sensitive to European sovereign debt, especially Italian, and I expect wild fluctuation as the market tries to over analyze each tidbit of news. I am only interested in looking ofr short term trades at the moment between 1243.00 and 1265.00.

Currencies: As of this writing the Dec. Euro is currently 40 lower at 1.3570, the Swiss 59 lower at 1.0958, the Yen 30 higher at 1.3005 and the Pound 52 lower at 1.5845. I am once again interested in the short side of the Yen on any further rallies feeling that the possibilty exsts again for intervention (admittedly this is risky). We remain long out of the money puts in the Yen. I am also looking at out of the money puts and/or put spreads for either Jan. or Mar. expiration in the Euro.

Regards,

Marc
888.908.4310 | 312.264.4310
mnemenoff@pricegroup.com