Financials: As of this writing (6:30am) June Bonds are 28 points higher overnight and 1’11 lower since a week ago, 10 year notes 6 higher overnight at 131’04 and down 31 over the last week and the 5 Year note unchanged at 123’13 down 17 points for the week. Over the last week yields have risen but remain slightly below recent highs. The 2 year yield is up 1 basis point at o.15%,the 5 year note up 10 points at 0.93%, the 10 year up 10 basis points at 1.71% and the 30 year bond up just 2 points at 2.37%. The prospect of a 2+ trillion infrastructure bill and the accompanying corporate tax hike have had traders raise the inflation question thereby pushing rates higher and treasury prices lower for the first quarter of 2021. As mentioned last week I have retreated to the sidelines on these markets as I feel they are oversold at current prices amid the Fed’s policy of leaving short term rates unchanged.
Grains: May Corn is currently 15 cents higher at 579’0 up 29’0 for the week and May Beans up 9’0 at 1448’0 up 19’0 for the week. Both Corn And Beans were up the daily limit in response to planting intentions report which showed Corn acreage at 91.14 million acres, far below pre-report estimate of 93.32 million acres. Bean acreage at 85.6 million acres was well below the estimate of 87.6m acres. Expanded daily limit today of 40’0 for Corn and 105’0 for Beans. I am looking to take profits from long positions on rallies.
Cattle: Yesterday Apr. LC closed unchanged at 120.47 up135 since last week and Apr. FC down 295 at 143.87 up 142 for the week. June LC were 67 higher at 122.90 and May FC down 280 at 1499.40. I remain long term bullish but feel in the near term the market is a bit overbought and suggest taking profits from long June and Aug. LC positions on further rallies. Higher feed cost could have a near term negative impact on prices.
Silver: May Silver is 16 cents lower at 24.28 down 60 cents for the week. If you went long below 25.00 use a protective sell stop just below recent low of 23.79.
S&P: June S&P’s are currently 15.00 at 3982.00. Treat as a trading market between 3920.00 and 3987.00.
Currencies: currently the June Euro is 14 points higher at 1.1756 down 79 for the week, the Yen 3 lower at 0.9033 down142 for the week, the Pound about unchanged at 1.3780 up 67 for the week and the Dollar Index 3 lower 93.20 up 67 for the week. I remain favorably biased to both the Yen and the pound. I have had a negative bias to the Dollar Index since it traded above the 92.50 level.
Please reach out to me if you’d like to learn more about my strategy or get my entry levels.