Financials: Sept. Bonds are currently 22 lower at 166’07, 10 Yr. Notes 7.5 lower at 131’04.0 and 5 Yr. Notes 3.75 lower at 119’16.5. The long Dec. 19/short Dec.20 Eurodollar spread is currently down 2 points at 57.5 premium the Dec.20. This spread has not worked but I’ll wait and see if it gets below 50 points before liquidating. Concerns about global recession and trade wars have continued to apply upward pressure to all treasuries. The long Bond yield made a historic low of 1.95% and the yield curve between the 2 and 10 Yr. Notes has inverted for more than moment trading at 0’05 points premium the 2 Yr. Note for the last several days. These markets seem to be nearly fully price and I feel comfortable selling rallies in the 5 Yr. Note above 1129’20.0, which is a yield of 1.38%, as a trading vehicle. The 30 yr. Bond is just too volatile for me to be trading.
Grains: Dec. Corn is currently 2’0 higher at 373’0, Nov. Beans 5’0 higher at 871’0 and Dec. Wheat 2’2 lower at 473’0. Government Reports have been at odds with trader’s estimates of crop size, acreage planted and potential yield per acre. Gov’t estimates are much higher than that of the trade. Add technical to the mix and we have a bear market. I feel there is more damage and yield erosion than these Reports show. I recommend to start trading from the long side on breaks. You might also consider going long near the money calls.
Cattle: Live and Feeder Cattle have come off of recent lows due in part from the prospect of easing tensions on the trade war. I will be a buyer in Oct. LC below 98.25 with a potential upside of 103.00-105.00 Silver: Dec. Silver is currently 19 cents higher at 18.65. We remain long. If you are long multiple contracts, consider taking some profits and replacing those contracts on a 25-50 cent break.
S&P’s: Sept. S&P’s are currently 27.50 higher at 2917.25. The market is currently in resistance and I’m a seller between 2915.00 and 2922.00. I will risk 15.00. If the market trades below 2804.00 lower your stop to break even. Near term support is the 2865.00 area.
Currencies: I am on the side lines