Financials: Sept. Bonds are currently 18 lower at 123'26. We continue to favor the short side of this market by holding the short Bond/ long 10 Yr. or 5 Yr. Notes spread or the combination of short Bond futures and short out of the money puts. Support remains at 123'06 and resistance remains at 124'26. If the market trades below the 123'06 level consider taking profits on the aforementioned spreads. If you are holding the combination of short futures and short options and support is broken, I recommend holding the position.
Grains: Yesterday Beans closed 12 higher, Corn 1 higher and Wheat 4 lower. Over night Beans closed 4 higher, Corn 2 lower and Wheat 1 higher. I still favor the long side of the Grains with a protective sell stop 5 cents below the recent lows. We continue to hold out of the money call spreads in Nov. Beans and remain short the Sept. Corn 340'0/420'0 strangle.
Cattle: Yesterday Live Cattle closed about 30 lower giving up early gains of 50-80 higher as equities and feed grains turned soft late in the session. Feeder Cattle managed to hold onto a 30-40 point gain for the day. Over night Feeder Cattle and Live Cattle are trading 20-40 higher. We remain long Aug. Cattle with a protective sell stop below the 87.00 level.
Silver: July Silver is currently 15 cents lower at 18.03. Near term support is currently 17.30 and near term resistance 18.40. I remain on the sidelines.
S&P's: Jun. S&P's are currently 11.50 higher at 1067.00. Yesterday the market reached resistance in the 1073.00 area (the high was 1077.75) before retreating to the mid 1050's. If profits from a recent long position were not taken early my recommended sell stop at 1059.50 was penetrated late in the session. Near term support is now the 1053.00 level and near term resistance the 1078.00 level. I am presently on the sidelines, but favor the long side on breaks. Starting Monday I will consider Sept. as the lead contract which is currently trading at about a 4.00 discount to the Jun.
Currencies: As of this writing the Sept. Euro is 103 higher at 1.2088, the Swiss 45 higher at .8771, the Yen 35 lower at 1.0956 and the Pound 94 higher at 1.4624. I still like the lopng side of the Euro on sharp breaks. Near term support for the Euro is currently the 1.1950 area with near term resistance in the 1.2260 area. I will be looking to the short side of the Pound on a rally above the 1.4850 level if the market allows. The Sept. Dollar Index is currently 70 lower at 87.71. I still feel the Dollar Index is in an overbought situation.