Financials: Mar. Bonds are currently 23 lower at 141'05 and the 10 Yr. Notes 9 lower at 129'22. Weekly Jobless Claims were down 23,000 vs. expectations of down 7,000. Earlier this morning the ECB cut both their marginal and refi rates by 25 basis points (0.25%). The immediate effect was a break in the Bonds to the 140'14 level. I continue to recommend being long out of the money puts in either the Bonds or Notes. If the Bonds trade below the 140'20 level again consider rolling your puts to a lower strike price to take advantage of price declines.
Grains: Yesterday Beans closed 1 higher, Corn 3 lower and Wheat 12 lower. Over night Beans were 1 higher, Corn 3 lower and Wheat 5 lower. I am currently on the sidelines. I do however believe that users of Corn such as livestock producers should be looking at the current break in prices as a long hedging opportunity.
Cattle: Yesterday Feb. LC closed 22 higher at 119.77 and Jan. FC 60 higher at 142.72. If you continue to hold the combination of short Feb. LC and short the Feb. LC 118 put either take profits or use a protective buy stop at 120.70. If you get stopped out of the futures be sure to cover your short put. Producers who are short Feeder Cattle might consider covering short futures and purchasing out of the money puts and/or put spreads to take advantage of recent price declines.
Silver: Mar. Silver is currently 60 cents lower at 31.99. My only recommendation is for long term bulls to be long out of the money calls and/or call spreads.
S&P's: Dec. S&P's are currently 11.00 lower at 1253.00. Earlier this morning the market rallied ti the 1271.00 on a favorable weekly jobless claims report before breaking to current levels. As many of you may have read over the last week I have been touting the short side of the market from the 1270.00 level. I must admit that I personally missed this opportunity. If you went short in the 1270.00 area, ither take the quick profit or use a protective buy stop in the 1263.00 area.
Currencies: As of this writing the Dec. Euro is currently 61 lower at 1.3335, the Swiss 29 lower at 1.0790, the Yen 41 higher at 129.19 and the Pound 17 lower at 1.5675. I continue to recommend being long out of the money puts in the Euro and the Yen for either Jan. or Mar. expiration.
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