Financials: Jun. Bonds are currently 2 lower at 115'20. Yesterday the market rallied more than a full point (32 ticks) as a result of the 10 Yr. Note auction which was oversubscribed and resulted in a 3.86% rate. Prior to the auction the 10 Yr. Note was showing a rate of about 3.94%. I remain a negative on the Bonds and continue to hold the Jun. 114'00/112'00 put spread.

Grains: Yesterday Beans were 8 cents higher, Corn 10 higher and Wheat 11 higher. Over night Beans were 2 lower, Corn 2 lower and Wheat 4 lower. My near term objective of 470'0 has been reached and surpassed in May Wheat. If you remain long either take profits or raise your protective sell stop to the 461'0 level. The next level of resistance is the 483'0 area. I am also putting out a recommendation for a call spread in Nov. Beans. I am buying the Nov. 1020'0/1060'0 call spread at 8'4 ($425.00). I feel that this is a cheap way to be involved in an upside play in the Beans if inflation kicks in as many pundits predict. To be honest it is a bit too early to call this a trade based on improving fundamentals as new crop Beans remain an unknown.

Cattle: Yesterday Live Cattle closed sharply higher due to an improving cash market which saw prices in the 98.00-100.00 range. Feeder Cattle followed suit closing higher but off it's highs of the day as feed prices rose mid-session. I continue to recommend hedgers use put options as opposed to short futures positions for price protection. Both Live and Feeder Catttle are trading moderately lower as of this writing.

Silver: May Silver is currently 18 cents lower at 18.03. I remain on the sidelines, awaiting a break to re-establish a long position.

S&P's: Jun. S&P's are currently 5.00 lower at 1174.00. We remain short a combination of futures and out of the money puts. I continue to recommend a protective buy stop at 1192.00 for this position. If the market trades below the 1166.00 level, lower your buy stop to the 1186.00 area.

Currencies: As of this writing the Jun. Euro is trading 50 lower at 1.3322, the Swiss 28 lower at .9328, the Yen 25 higher at 1.0753 and the Pound 61 lower at 1.5206. As mentioned yesterday, I feel the European Currencies (Euro, Swiss, Pound) are too close to a test of recent lows for me to establish a any kind of a position at current levels. As for the Yen, I remain negative and will look at a rally above the 1.0850 level as an opportunity to once again play this market from the short side with either futures or put options.

Regards,

Marc