June Bonds are currently 18 lower at 144’12

Marc Nemenoff PRICE Futures Group

Financials: June Bonds are currently 18 lower at 144’12, 10 Yr. Notes 3.5 lower at 120’01 and 5 Yr. Notes 1 lower at 113’22. The spread in terms of yield between the 10 yr. and 30 yr. has narrowed to 18 basis points, about as narrow as it has been in quite some time. What makes this significant is that it has happened as interest rates are rising. In the past this sort of action was considered recessionary. If you have access to a charting service check out the pattern of lead month weekly charts for both Bonds and the 10 Yr. What is of note is that the 10 Yr. is below the 2014 low of 123’18 while the 30 yr. is significantly above its 2014 low of about 128’00. For the last few weeks I have recommend treating the Bonds as a trading affair between 144’15 and 147’06. If you bought the Bonds at 144’15 I recommend using a protective sell stop at 143’27. If the market trades above 145’00, raise your sell stop to 144’02 or take profits. I am lowering resistance to 146’16.

Grains: May Corn is currently fractionally lower at 382’6, May Beans unchanged at 1041’6 and May Wheat 2’0 higher at 477’2. I remain short May Beans from the 1034’0 area. Support is currently 1026’0 and resistance 1064’0.

Cattle: June Live Cattle may have put in a bottom in the 98.00 even area, that being said, technically we remain in a downtrend. I am looking to return to the short side of the market in the 106.00-108.00 area. A couple of weeks ago I had recommended that short hedgers in both Live and Feeder Cattle cover some of their futures and replace them with out of the money puts. The market is quite a bit higher from that recommendation, I will now be looking to once again using futures on rallies.

Silver: May Silver is currently 2 cents higher at 17.27 and 67 cents higher than last weeks’ “Report”. I remain long. It is time to roll positions to the July contract.

S&P's: June S&P’s are currently 8.50 lower at 2701.50. I am still recommending being long either out of the money puts and/or put spreads.

Currencies: I am still on the sidelines. However, I am looking for a selling opportunity in the Pound should it trade above 1.4500 as Brexit concerns once again come to fore.

Author

Marc Nemenoff

PRICE Futures Group

Mr. Nemenoff is a 37-year veteran of the futures industry.

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