The strength in the dollar and the weakness in the precious metals has been the feature since the opening bell last night.

SPU…we are looking to see a probe into the 1327.50-29.50 area & NASD..2500-02 during the Chicago pit session over the next day or so. This type of back and fill price action should not be a surprise after the big run up on Friday, when there was no back and forth to the markets.

Model Trading Portfolio…Current Holdings

………………Stop Close       Profit Points

Long TLT      116.50              121.70

Long XLE       70.40              80

Long OXY

Long DE        85.90

Long COP      67

Short Term View

Location ,Location,Location….if you have a good trad able pattern “Good Risk reward!” You just have to seize the opportunity and see what develops!

Trade to Make Money!

Medium Term View…

30 Yr. Bonds …147 is the all time high in the front month futures. We will watch price action off this level for any potential surrogate moves in the currencies or stock indices. 144.20 ish now becomes our macro pivot. All new closing strength over 145.20 would have us looking for more upside in the Bonds. Closing above this level would be short term positive the Bonds and negative the Equities.

Equities…We will continue to strategically buy hard breaks in Etf’s and individual instruments we feel have the best risk profiles going into the end of the first qtr.

Currencies…Our view is the Aussie Dollar remains a most attractive investment. The Bonds are high yielding making this currency desirable on breaks. It also has the benefit of the underlying commodity and Asian growth story to support buying the dips.

The Aussie typically mirrors the S&P 500 which also makes it an easy surrogate to trade, whether Risk On or Risk off. It’s liquidity makes it easy to hedge currency risk if you’ve the underlying Bonds, which makes you Long Aussie by default.