Bonds make new weekly high

Bonds make new weekly high amid Russian Sanctions and Mid East Tensions as Equities set back.

Financials: Sept. Bonds are currently up 19 points at 137’24, 10 Yr. Notes up 9.5 at 125’06.0 and 5 Yr. Notes 5 higher at 119’06. This morning: Weekly Jobless Claims were down 3,000 vs. expectations of up 5,000. June housing starts were down 9.3% vs. expectations of up 1.4%. Building permits were -4.2%. U.S. and E.U. calling for more sanctions against Russia. With the exception of a somewhat friendly Jobs number, circumstances have moved these markets upward to recent highs as traders and investors look to safety as opposed to yield. Earlier in the week I recommended the long 10 Yr./short Bond spread above the 12’05 premium the Bonds level. This spread is currently is currently at 12’17 and we are willing to to put this on looking for a short term play of 2-5 days.

Grains: Dec. Corn is currently 2’2 lower at 384’4, Nov. Beans 4’2 lower at 1097’6 and Dec. Wheat 1’0 lower at 561’0. Once again I am a light buyer in Corn at present levels with an initial 20 cent risk. If Dec. Corn should trade above 393’0 I will raise protective sell stops to the 376’0 level, just below the recent low of the 378’0 area. As for Beans and Wheat I am watching to see if the recent lows of the 1069’0 and 550’0 areas hold.

Cattle: Aug. LC are currently 225 higher at 149.92 and Aug. FC 122 higher at 211.05. Theses markets are too volatile for me to be involved in at the moment.

Silver: Sept. Silver is currently 10 cents higher at 20.57 and Aug. Gold 6.00 higher at 1306.00. We remain long Silver as a long term trade. Gold has seen hard sell offs this week with rumored sales by unknown entities (probably hedge funds) of 10,000 and 17,000 contracts respectively. This sounds like a lot to hit the market at any given time, but realistically in this age of multi Billion Dollar funds it is not unrealistic to expect that from time to time there will be purchases and sales of billions of dollars worth of precious metals coming into the market. That being said I am still a buyer in Gold in the 1287.00 area.

S&P's: Sept. S&P’s are currently8.50 lower at 1966.25. Proposed sanction against Russia and mid-East turmoil weigh on the market this morning. We are still holding the combination of short futures and short the Sept. 1900 put.

Currencies: As of this writing the Sept. Euro is currently 10 higher at 1.3536, the Swiss 15 higher at 1.1148, the Yen 26 higher at 0.9862 and the Pound 31 lower at 1.7095. We continue to hold short biased positions in the Euro.