Financials: June Bonds are currently 19 lower at 118'29. This morning's weekly jobless claims report showed a drop of 20,000 versus a pre-report expectation of an increase of 9,000. Continuing claims dropped 59,000 to 3,774,000. If you are currently short the Bonds I recommend taking profits and standing aside until after tomorrow's monthly unemployment report. If you are staying with a short position lower your protective buy stop to the 119'16 level. I will be looking to reinstate a short position at the 120'06 level if the market allows. We continue to hold out of the money puts and/or put spreads in the June and Sept. 2012 Eurodollars.
Grains: Yesterday May Beans closed 19 cents higher, Corn 13 lower and Wheat a penny higher. Over night Beans were 2 higher, Corn 3 higher and Wheat 6 higher. Yesterday May Corn tested resistance in the 740'0 area making a high of 740'6 before breaking to the 707'0 level, establishing a range which should hold for the next few sessions. We continue to hold the combination of short the May Corn 660'0 put and short the May Corn 740'0 call.
Cattle: Yesterday Live and Feeder Cattle closed sharply higher as the cash market for live cattle traded as high as 112.00. We have been stopped out of recent short positions with about a scratch. I am willing to once again pursue the short side of these markets 50- 100 higher from current levels.
Silver: May Silver is currently 37 cents lower at 34.45. Apr. Gold is currently 12.00 lower at 1425.00. Yesterday we rolled the long leg of the June Gold 1450/1500 call spread up to the 1470 strike price for 7.00 or better (we bought the 1470 call and sold the 1500 call for a premium of $700 of which we collected the premium). We are now long the 1470 call and short the 1500 call.
S&P's: Mar. S&P's are currently 16.50 higher at 1322.00. Our buy stop against a recent short position in the 1319.00 area has been penetrated. I will once again be a seller above the 1324.00 level.
Currencies: As of this writing the Mar. Euro is currently 86 higher at 1.3946, the Swiss 83 lower, the Yen 62 lower and the Pound 52 lower at 1.6276. The Euro is gaining on most other currencies on comments from the ECU that rates may raise in Apr. as a means of fighting inflation. I'm not convinced that this would be bullish against the Dollar but I am not willing to aggressively pursue the short side. That being said we remain long puts on the Apr. and June contracts which are now admittedly pretty far out of the money and have a small short futures position at a 200+ point loss.
Senior Market Analyst, Price Futures Group
Publisher, Nemenoff Letter
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