Marc Nemenoff
PRICE Futures Group
ECB adds to stimulus, but less than expected. Dollar and Dollar related assets (Bonds Equities) fall.
Financials: Mar. Bonds are currently 6 higher at 152’09, 10 Yr. Notes 3 higher at 125’21 and 5 Yr. Notes 2 higher at 118’11. Yesterday these markets broke sharply as the ECB announced a continuation of their stimulus program in an effort to activate business activity and force inflation, which is currently only showing a disappointing increase of 0.1% well below a target of 0.2% per month. Traders were disappointed by the amount ofr stimulus and found reason to sell Dollar related assets fearing that the amount of stimulus was not enough to lower European rates. We remain spread long 3-5 Yr.
Notes/short 2-10 Yr. notes, now at a small profit. More to come after the Employment Report.
Grains: Mar. Corn is currently fractionally lower at 376’4, Jan. Beans 3’4 lower at at 894’0 and Mar. Wheat 1’2 higher at 480’0. Grains are up a bit over the last few sessions as the Dollar has retreated sharply from recent highs. We remain long Mar. Corn and recommend raising your protective sell stop to the 367’0 level. The long Mar. KC Wheat/short Mar. Chicago Wheat spread is currently trading at -2’6. We will be looking for profit taking opportunities at 8’0 premium the KC contract.
Cattle: Live and Feeder Cattle have broken sharply over the last few sessions. As recommended in my last “Report” (12/1/2015) we are now long Feb. LC from below the 130.10 level and/or spread long Apr./short June from below the 7.80 premium Apr. level.
Silver: Mar. Silver is currently 5 cents higher at 14.13 and Feb. Gold 1.00 lower at 1060.30. We remain lightly long. These markets made new lows this week and have started to show some upward momentum as the Dollar retreated. A close above 14.40 in Silver may be a buy signal.
S&P's: Dec. S&P’s are currently 4.00 higher at 2055.25. Treat as a trading affair from the short side above the 2060.00 level. Support is currently 2038.00.
Currencies: As of this writing the Dec. Euro is currently 74 lower at 1.0900, the Yen 45 lower at 0.8131 and the Pound 14 lower at 1.5138. The euro rallied sharply yesterday in response the the ECB’s tepid stimulus action and may have put in a bottom. We remain long the Yen with a stop at 0.8060.
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