Financials: Sept. Bonds are currently 3 lower at 127'02. Yields on the 30 Yr. Bond and 10 Yr. Notes are back to about 4% and 3% respectively. A stronger equities market and the ability of most European banks to pass the stress tests have taken some of the upward pressure off the long term interest rate vehicles (30yr., 10 yr. and 5 yr.). If you remain spread long the 10 Yr. Notes/short Bonds (currently at 4'16) I would recommend contniuing to hold out for the 4'00 level premium the Bopnds to liquidate the position. Near term support is once again the 126'16 level and near term resistance the 128'08 level. Treat as a trading market between support and resistance.
Grains: On Friday Nov. Beans closed 2 cents higher, Corn 5 lower and Wheat fractionally lower. Over night Beans were 7 lower, Corn 2 lower and Wheat 4 lower. We remain long out of the money call spreads in Dec. Corn. I will be looking to trade Dec. Corn from the long side below the 377'0 level and Nov. Beans from the long side below the 963'0 level if the market allows. Producers should be looking for hedging opportunites in Dec. Corn in the 400'0 area.
Cattle: On Friday Live Cattle closed 10-30 higher and Feeder Cattle 30-55 higher depending on the contract month. Friday's Cattle on Feed showed the following: On Feed 103% of a year ago versus an average estimate of 103.3%. Placements 117% versus 120.3%. Marketed 100% versus 101.7%. The Cattle Inventory Report was in line with expectations of 99% all cattle and calves and 99% for the annual calf crop. The placement figure on the Cattle on Feed Report can be construed as friendly for Live Cattle but I feel this figure is already priced into the market. We remain short Oct. Live Cattle and will use a protective buy stop at 95.65 which I recommend placing about one half hour after the market opens this morning to avoid the initial effect of Friday afternoon's reports. If Oct. Cattle should trade below the 93.50 level, lower your stop to the 95.30 level. Producers should be looking for hedging opportunities at present level for Aug., Sept. and Oct. contracts.
Silver: Sept. Silver is currently 10 cents higher at 13.20. We remain long the Dec. 20/22 call spread. Resistance on the Sept. contract remains in the 18.40-18.50 area.
S&P's: Sept. S&P's are currently fractionally higher at 1101.00. The market has broken out to the upside of its recent range with Friday's close above the 1099.00 level. I'm not ready to bullish yest but must show respect for the recent rally. Near term support is now the 1084.00 arear and resistance the 1110.00 Area. Once again I will be looking to the options side of the market and will be interested in going short the Sept. 1140.00 call above the 24.00 level (currently 18.00) if the market allows. For those of you who are short term futures traders, treat as a trading market between support and resistance.
Currencies: As of this writing the Sept. Euro is 13 higher at 1.2933, the Swiss 20 higher at .9534, the Yen 32 higher at 1.1479 and the Pound 66 higher at 1.5485. We continue to hold a short bias in the Euro by being either short calls or long puts. I expect time decay to start excellerating for those of you who are short Sept. Calls as there is only about 5 weeks left on these options. I am still watching the Swiss for a sell signal if this market trades below the .9470 level.