Financials: Dec. Bonds are currently 10 lower at 148'31 and the Dec. 10 Yr. Note about unchanged at 133'00. Wed. and Thurs. the FOMC will have a two meeting and the market is currently divided as to whether there will be an announcement of another round of Quantitative Easing. According to polls that I have recently read, 60% of economists surveyed thought that the Fed will do another round of "Easing". Personally, I think at current levels another round of easing will have little effect. That being said, at current levels I choose the sidelines and am only looking for short term trades either from the short side above the 151'00 level or the long side below the 147'00.
Grains: Dec. Corn is currently 2'6 lower at 796'6, Nov. Beans 9'0 lower at 1727'4 and Dec. Wheat 0'6 lower at 904'2. I am recommending taking profits on the combination of short the Dec. Corn 680'0 put and short the Dec. Corn 900'0 call today. I want to be on the sidelines going into Wed. morning's Crop Production Report which has the potential to move the market substantially which would have an adverse effect on this trade.
Cattle: On Friday Oct. LC closed 42 higher at 126.47 and Oct. FC 10 lower at 146.15. These markets continue in a sideways pattern. Support for Oct. LC is currently the 124.00 level with resistance in the 127.50 area. A settlement above the 128.00 level could be an upside breakout. The long Dec. Hog/ short Dec. Cattle trade has not been working. If you are in this trade with multiple contracts, I recommend reducing your position size at this time.
Silver: Dec. Silver is currently 16 cents lower at 33.56 and Dec. Gold 8.00 lower at 1732.00. We remain long Silver with a long term objective of 36.00. We are currently on the sidelines in Gold.
S&P's: Sept. S&P's are currently 3.00 lower at 1435.25. The market is now on four and a half year highs with resistance in the 1440.00 area. I am on the sidlines. Support is currently 1424.00 for the near term.
Currencies: As of this writing the Sept. Euro is currrently 15 lower at 1.2783, the Swiss unchanged at 1.0577, the Yen 4 higher at 1.2780 and the Pound 31 lower at 1.5974. To be honest I am looking for a reason to go short the Euro but am hesitant to enter the market at this time.
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