Bonds Lower, Dollar Lower, S&Ps Steady
Marc Nemenoff I PRICE Group - 08 March 2010
Financials: June Bonds are currently 8 lower at 11614. If you remain short the Bonds or short the combination of June Bonds and the June Bond 11500 put either take profits or use a protective buy stop at 11722. If you have the combination and you are stopped out of the futures, buy back the short 11500 put. Near term support is currently the 11606 level. If near term support is penetrated, the next level of support is the 11518 level.
Grains: On Friday May Beans closed fractionally higher, Corn 7 cents lower and Wheat 8 lower. Over night Beans were 3 higher, Corn fractionally higher and Wheat 2 higher. I am still looking to be a buyer in May Beans in the 9350 area and May Corn in the 3680 area. The May Beans 8800/10000 strangle closed at 200 on Friday. If you remain short this strangle I will be looking to cover this position at 190 or better today if the market allows. Time decay should start working in our favor as long as the Beans stay above 9200 and below 9750.
Cattle: On Friday Apr. Cattle closed 7 lower at 92.50 and June 10 lower at 91.57. Open interest in the nearby Apr. lost 6600+ contracts while June gained 3500+ and Aug. gained 2800+. Overall open interest gained 1300+. I continue to wait on the sidelines. However, I feel that hedgers should be looking at out of the money puts on any further strong rallies as price insurance. I am not ready to recommend hedgers be short futures at the moment as the market is technically pointing toward higher prices.
Silver: May. Silver is currently 5 cents higher at 17.44. If you remain long futures, take some profits. We remain long out of the money call spreads on the July contract.
S&Ps: June S&Ps are currently 1.00 higher at 1132.75. I remain on the sidelines as far as
futures are concerned. I continue to recommend being long out of the money puts as portfolio insurance.
Currencies: As of this writing the Jun. Euro is 39 higher at 1.3660, the Swiss 31 higher at .9347, the Yen 10 higher at 1.1084 and the Pound 13 lower at 1.5135. Greeces ability to sell their first round of Bonds with the market being oversubscribed by 300% has given some strength in the past two sessions. I still favor the short side of this market and am patiently waiting for a selling opportunity above the 1.3800 level. The Yen has fallen 200+ points over the last few sessions. If you are the long 1.0700 put or 1.0700/ 1.0200 put spread I recommend taking some profits. I will buy the 1.0600 put and simultaneously sell the 1.0700 put at 25 points premium the 1.0700. The June Dollar Index is currently 18 lower at 80.56.
Regards,
Marc
Marc Nemenoff
312.264.4310
mnemenoff@pricegroup.com
www.pricegroup.com
Bio
Marc Nemenoff is a 37-year veteran of the futures industry. While attending graduate school at the Illinois Institute of Technology, Marc took a job as a clerk on the trading floor of the Chicago Mercantile Exchange for Tabor Grain Co. He quickly found that his background in both math and problem solving techniques were adaptable to the futures markets as well as the career he had been pursuing in Architecture and Urban Planning. Having decided on a career change he quickly rose within the Tabor Grain Co. organization and became their analyst and operations manager for all products traded on the Chicago Mercantile Exchange.
In 1976 Mr. Nemenoff's responsibilities increased when he was granted full membership on the Chicago Mercantile Exchange as Tabor Grain Co's. representative to the exchange. He was their head analyst and liaison to all branch offices. In addition, he was in charge of designing hedging strategies in both the livestock and financial sectors of the market, and writing the firms daily and weekly market letters.
In 1980 Mr. Nemenoff purchased his own membership on the C.M.E. and spent the next 12 years as an independent trader, trading in all markets with a concentration in live cattle as a spreader and market maker. As a member of the exchange he served on many committees including, Live Cattle, Nominating, Contributions, Public Relations and Advertising, and Orientation and Education. During this time he gave speeches to various groups at the behest of the exchange. These included, Agricultural Bankers, The National Cattleman's Assoc., various groups on the Role of the Market Maker, and various groups on the Role of Futures as a Risk Management Tool.
In 1991 Marc left the floor and spent his time as an independent trader and lecturer giving speeches at seminars on various topics. These included Livestock Trading, Interest Rate Futures, Spreads, Technical Analysis, and trading in the pit vs. being an outside speculator. He also taught classes as a guest lecturer at the Chicago Mercantile Exchange on Spreading, Technical Analysis, and Commodity Options.
Since 2004 Marc has been an Associated Person handling customer accounts for both speculators and hedgers. Marc has also been author of the Nemenoff Report, a daily overview of the markets adding his own perspective on market direction.
Since 2002 Marc has been a Board member of Art Encounter, an Evanston, IL.. non- profit organization, specializing in the visual arts and providing community outreach programs, such as art classes for people of all ages with special needs. Marc has been President of Art Encounter since 2009.
Mr. Nemenoff describes his approach to the market as 75% technical and 25% fundamental. He is also a firm believer in the use of option strategies as a way of using leverage and minimizing risk when one has a long-term market strategy.
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