The Nemenoff Report Bonds Lower, S&P's higher, Silver Lower

By Roger Baettig | August 14 2012 9:56 AM

Financials: Sept. Bonds are currently 31 lower at 147'27 and the 10 Yr. Notes 9 lower at 133'11. This morning: Retail sales were up a better than expected 0.8% and PPI was up 0.3%. Euro-zone GDP was slightly better than expected at -0.2% showing improvement in Germany, France and the Netherlands and negative growth in other countries. Near term support remains in the 147'20 level but resistance has been lowered to 149'28. Treat as a trading market between support and resistance.

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Grains: Dec. Corn is currently 5'6 higher at 798'0, Nov. Beans 10'6 higher at 1611'4 and Dec. Wheat 6'4 higher at 88'2. On Friday Dec. Corn made a technical "Key Reversal" ( a new contract high and a close below the previous day's low). That being said, support remains in the 785'0 area. Resistance is now the 830'0 area. I am now willing to once again look at selling strangles in the Corn now that they may have put in a top. I am selling the combination of the Dec. Corn 900'0 call and the Dec. Corn 680'0 put and collecting about 32'0. If by mid November Dec. Corn is above 650'0 and below 930'0 this trade should be profitable. Keep in mind that selling strangles has limited profit potential and unlimited risk.

Cattle: Oct. LC are currently50 higher at 126.90 and Oct. FC 50 higher at 144.00. As expected FC prices have gained on LC as feed grain prices have declined from historic high levels. Technically Oct. LC should run into resistance above the 127.00 area. Oct. FC have traded above their 144.00 resistance levels and show the possibility of an upside breakout if they can settle above 145.00. If you have been trading FC from the long side use a close protective stop or take profits until this market shows an upside breakout.

Silver: Sept. Silver is currently 10 cents lower at 27.67 and Dec. Gold 13.00 dollars lower at 1600.00. We remain lightly long Silver. Over the last couple of seesions Dec. Gold have not been able to hold the 1625.00 resistance level and remains in a trading range of 1585.00 to 1625.00.

S&P's: Sept. S&P's are currently 4.50 higher at 1406.50. Better than expected econmic data (see Financials comment) have pushed this market through the 1404.00 resistance level with a high of 1409.50. Consistant closes above the 1396.00 level could indicate higher prices. That being said, I remain somewhat neutral and will consider a close below the 1395.00 level a minor sell signal.

Currencies: As of this writing the Sept. Euro is currently 15 higher at 1.2353, the Swiss 7 higher at 1.0281, the Yen 88 lower at 1.2677 and the Pound 6 lower at 1.5680. Once again I am looking for a selling opportunity in the Euro if the market trades above 1.2475.

Regards, Marc 888.908.4310 | 312.264.4310 mnemenoff@pricegroup.com