Financials: Mar. Bonds are currently 5 lower at 142'30 and the 10 Yr. Note 3 lower at 130'12. Yesterday the Fed left rates unchanged but painted a somewhat bleak picture concerning housing, unemployment and European debt. They did note that the economy has been expanding slowly, long term inflation is stable and that the Fed expects moderate growth in coming quarters. Also expectations are that interest rates could stay exceptionally low to at least through mid 2013. This caused the rate on the 10 Yr. Note to once again dip below the 2.00% level. I am still looking to treat the Bonds as a trading affair between 140'20 and 143'18. I am also willing to do the long 5 Yr. Note/ short 10 Yr. Note at 7'15 premium the 10 Yr. Note (currently at 7'10) if the market allows.

Grains: Yesterday Beans closed 6 cents higher, Corn fractionally higher and Wheat 6 higher. Over night Beans were 4 lower, Corn 1 lower and Wheat fractionally higher. I am on the sidelines.

Cattle: Yesterday Feb. LC closed unchanged and Jan. FC 90 higher, both of these markets closing well off inter day highs. Currently LC are slightly lower and Feeders about 75 lower. I am currently on the sidelines after covernig all short positions earlier in the week.

Silver: Mar. Silver is currently 1.58 lower at 29.68. I am still afraid of using futures on the long side of this market and only recommend either out of the money calls and/or call spreads for those of you who are long term bullish. Feb. Gold is currently 40.00 lower at 1623.00, in the support area of 1610-1635.00. If support does not hold, look for a break to the 1560-1570.00 level. The market appears to be worried about stagnation and disinflation for commodities in general. Trade with caution.

S&P's: Mar. S&P's are currently 4.00 lower at 1216.00. Market reaction to yesterday's FOMC minutes was to the downside after staging an early rally to the 1240.00 area then trading below the years mid-point of the 1220.00 area. Trends are now down. Support is now the 1206.00 level and resistance 1238.00. I am on the sidelines.

Currencies: As of this writing the Mar. Euro is trading 54 lower at 1.3000, the Swiss 30 lower at 1.0569, the Yen 11 lower 1.2841 and the Pound 28 lower at 1.5450. If you remain long puts in the Euro, today is a good time to either take profits, roll to a lower strike price or sell a further out of the money put against your position leaving you with a put spread. Personally I think one should continue to hold something and recommend the Jan. 1.24 or 1.22 puts which are still cheap. We remain long out of the money puts in the Yen.

Regards, Marc

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mnemenoff@pricegroup.com