Marc Nemenoff
PRICE Futures Group
Financials: Mar. Bonds are 3 lower at 157’04, 10 Yr. Notes 3 lower at 127’02 and 5 Yr. Notes 1.5 lower at 119’06.7. The market awaits this weeks FOMC’s decision on interest rates which the “trade” expects to rise. Comments by Mario Draghi of the ECB took Bonds off their lows as it was reiterated that he will do whatever it takes to stimulate European economies and feels they will hit their target of 2% inflation. I still hold the ratio spread of long 3-5 Yr. Notes/short 2-10 Yr. Notes. For those of you with a greater risk tolerance you might consider selling out of the extra 5 5 Yr. note as this market is now in resistance. The spread is currently at a $350-$400 loss.
Grains: Mar. Corn is currently fractionally lower at 375’0, Jan. Beans 2’4 lower at 868’2 and Mar. Wheat 1’6 lower at 489’0. If you remain long Mar. Corn either take profits or raise your protective sell stop to the 369’0 level. The Mar. KC Wheat/Chi. Wheat spread is currently at 6’6 premium the Chi. Contract. My objective remains at 8’0 premium KC.
Cattle: Live and Feeder Cattle remain under pressure but have rallied 3.00 off their lows with the Feb. LC closing out the week at 125.90. We remain long. The long Apr. LC/short Jun. LC spread has met our near term objective of 8.40 premium the Apr. having traded as high as 8.75. Look for profit taking opportunities.
Silver: Mar. Silver is currently 16 cents lower at 13.73 and Feb. Gold 6.00 lower at 1070.00. We hold a small (mini contract) position and will NOT consider adding at this time unless Silver trades above 14.75.
S&P's: Mar. S&P’s are currently 5.50 lower at 1996.25. Thye market on Friday closed below the 200 day moving average and by my standard is now in Bear territory. I am a seller on rallies and will be a buyer of puts in an effort to hold a position. Be aware anything can happen when the FOMC minutes are released later this week. Support is currently 1980.00.
Currencies: As of this writing the Mar. Euro is currently 9 lower at 1/1011, the Yen 5 higher at 0.8306 and the Pound102 lower at 1.15129. If you remain long the Yen either take profits or raise your stop to the 0.8252 level.
EXTRA: Start thinking about the long side of Nat. Gas.
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