Financials: Sept. Bonds are currently 5 higher at 126'16. This morning's Durable Goods report was a bit of a disappointment coming in a -1% versus expectations of +1%. The immediate reaction was a rally to the 126'26 level before backing off to current levels. Yesterday the long 10 Yr. Note /short Bond spread traded at our objective of 4'00 premium the Bonds and we are now out of this position.
Yesterday we also recommended trading Bonds from the long side from the 126'13 level with a 10 point protective stop for a short term trade. If you went long, continue to use a protective sell stop in the 126'03 area. If the market trades above the 126'24 level again, raise your sell stop to your break even level. Support is currently 126'06 for the near term and 125'12 longer term. Near term resistance is currently 127'18.
Grains: Yesterday Nov. Beans closed fractionally lower, Dec. Corn 1 lower and Dec. Wheat 6 higher. Over night Beans were 7 cents higher, Corn 4 higher and Wheat 13 higher. If you remain long Nov. Beans and Dec. Corn, raise your sell stop in Beans to the 958'0 level and your sell stop in Dec. Corn to the 366'0 level. We remain long the Dec. Corn 420'0/440'0 call spread.
Cattle: Yesterday Live Cattle closed steady to slightly higher and Feeder Cattle slightly lower. Over night Live and Feeder Cattle are currently 20-30 lower. Oct. Cattle is currently at 93.50. If you remain short Oct. Cattle lower your protective buy stop to the 95.30 level. If the market trades below the 93.00 level, lower your buy stop to the 94.70 level.
Silver: Sept. Silver is currently 18 cents lower at 17.44. Earlier this morning Silver made a new recent low at 17.33. If the May 5th low of 17.15 is penetrated I would expect a break to the 16.60-16.80 area where I feel this market will look attractive and I would start accumulating a long futures position. We remain long the Dec. 20/22 call spread.
S&P's: Sept. S&P's are currently 2.00 lower at 1109.00. The market is trading lower as a result of the aforementioned Durable Goods Report. I am still somewhat on the sidelines in futures and looking to sell the Sept. 1140call on on rallies. Major resistance remains the June 21st high of 1129.50.
Currencies: As of this writing the Sept. Euro is 8 lower at 1.2980, the Swiss 15 higher at .9455, the Yen 21 higher at 1.1408 and the Pound 17 higher at 1.5603. I continue to have a short bias to the Euro (either short calls or long puts). If the Euro trades below the 129.46 level today it will generate a minor sell signal. If you remain short the Swiss from the recent .9470 sell signal contniue to use a protective buy stop in the .9630 area. If the Swiss trades below the 93.80 level, either take profits or lower your buy stop to your break even level.