Canadian $ breaks 2 cents on 25 point basis cut on rates yesterday

Canadian $ breaks 2 cents on 25 point basis cut on rates yesterday. ECB announce QE of 60 billion a month through Sept. 2016.

Financials: Mar. Bonds are currently 1’11 lower at 147’24, 10 Yr. Notes 16.5 lower at 128’29 and 5 Yr. notes 7.5 lower at 120’10. We remain short June 2017 Eurodollars (currently 6 lower at 98.17) and are attempting to buy the Sept. 2015 against this position at 99.44 (currently at 99.47).

Grains: Mar. Corn is currently 1’0 higher at 389’0, Mar. Beans 4’2 higher at 987’6 and Mar. Wheat 4’0 higher at 540’6. I remain somewhat friendly to these markets but will wait for a break bewfore I enter into any positions. I will be a small buyer in Mar. Corn below 373’0 and a small buyer in the Mar. Beans in the 965’0 area if the market allows.

Cattle: Feb. LC closed at 153.60 and May FC at 207.45 well above the weekly lows of 151.45 and 203.32 respectively. We were stopped out of a recent long Feb. LC position when the market traded below the 152.80 level putting us on the sidlines. The overall trend remains down and it is expected that runs will remain somewhat heavy for the next 30 days. I am on the sidelines until next week.

Silver: Mar. Silver is currently 3 cents lower at 18.15 and Feb. Gold 4.00 lower at 1289.00. If you went short Silver in 18.40 area (Monday’s stated resistance level) or short Gold in the 1300.00 area, take the short term profit.

S&P's: Mar. S&P’s currently 16.00 higher at 2042.00 rallying since the announcement of ECB quantitative easing policy. Earlier in the week we took profits from short side of the market trading from the 2023.00 level. My bias is now neutral and I will treat the market as a trading affair between 2022.00 and 2047.00.

Currencies: As of this writng the Mar. Euro is currently 15 lower at 1.1585, the Swiss 5 higher at 1.1697, the Yen17 higher at 0.8500 and the Pound 40 higher at 1.5160.
Yesterday in a surprise move Canada lowered rates by 25 basis points breaking the Canadian Dollar more than 2 cents to the 0.8050 level. Minutes ago Mario Draghi of the ECB announced a Quantitative Easing program of 60 Billion Euro’s per month through Sept. 2016 in an effort stimulate inflation. It is not yet clear to me on the details of these purchases of whether Bonds and securities will be purched by the ECB or individual central banks. The immeadiate reaction was a break from the 1.1640 level to 1.1520 and back to 1.1580. I want to continue to treat the Euro as a trading affair from the long side on sharp breaks.