Financials: Dec. Bonds are currently 21 higher at 147’21 and the 10 Yr. Notes 6.5 higher at 132’10. Once again the Bonds appear to be going into “risk off” mode as Spanish bond rates creep higher and equity earnings decline. Adding to that the uncertainity over our Election, just 2 weeks away, makes me want to head for the sidelines for the next few sessions. Today starts the 2 day FOMC meeting of which I expect no changes in current Fed policy. Over all I remain long term negative on the Bonds, but, as I have cautioned in the last couple of weeks, wait for sharp rallies to enter this market from the short side.

Grains: Dec. Corn is currently 7 cents lower at 754’2, Nov. Beans 13’4 lower at 1533’0 and Dec. Wheat 10’6 lower at 867’4. I continue to look to the long side of Dec. Corn in the 725’0-735’0 area if the market allows. As I mentioned in my last “Report” (Oct. 18th), for those of you that feel that the supply fundamentals remain bullish consider going long the Dec. 800’0 call in the 6’0 cent area (currently 6’4). This is a low risk way to be long. This morning the market is lower because of strength in the Dollar and some talk that harvest may be better than expected particularly for Beans.

Cattle: Dec. Cattle is currently 17 lower at 127.10 and Nov. Feeder Cattle 10 higher at 147.85. Friday’s Cattle on Feed Report showed the following: On Feed 97% of a year ago vs. average expectations of 97.8%. Placements 81% vs. expectations of 85%. Marketed 88% vs. expectations of 89.8% Basically the placement number was positive and the marketed number somewhat negative. As mentioned in my last “Report”, I need to see consecutive closes in Dec. Cattle above 127.50 in order to be convinced that prices are headed higher. This has not happened, on the 18th we closed at 128.05, the 19th 126.95 and yesterday 126.27. Mind you I do not see a substantial break on the horizon, particularly in deferred contracts, but feel that competition from other sources of cheaper protien, i.e., pork and chicken will keep Cattle prices on the defensive. Of note: Over the last 6 weeks Dec. Hogs have rallied nearly 9.00 from lows near 70.00 to a high of 79.50+. At this time I look for a break in Dec. Hogs.

Silver: Dec. Silver is currently 35 cents lower at 31.90 and Dec. Gold 15.00 lower at 1710.00 Both Gold and Silver are now in near term support and I am willing to be a buyer with a 50 cent stop in Silver and a 10.00 stop in Gold for a short term trade. For the long term we remasin long Silver.

S&P's: Dec. S&P’s are currently 17.00 lower at 1413.50. This market has broken substantially over the last few session due to some missed earnings (Google) and renwed fears over Soveriegn debt (Spain). We continue to hold puts and/or put spreads for Nov. expiration which are near the money. Look to take profits. Short term, I am looking to start trading from the long side of the market with close stops.

Currencies: As of this writing the Dec. Euro is trading 78 lower at 1.2978, the Swiss 63 lower at 1.0726, the Yen 9 higher at 1.2529 and the Pound 41 lower at 1.5960. If you remain short the Euro either take profits or lower your buy stop to the 1.3025 level.

Regards, Marc
888.908.4310 | 312.264.4310
mnemenoff@pricegroup.com