We’ve seen a contra-trend trade into resistance in the Spu’s,Aussie,Euro, and Yen Crosses as well as the the commensurate re-test lower in the Bunds & 30 Yr. Bonds over the past 2 sessions.

Now What?

Spu’s..let them be your guide today. 1388-90 ish can be a Bull trap the first time up. All new weakness under last night’s low ( 1377) is needed for the markets to continue lower.

General Comments….

We have a short Equity Indices bias with the small position in the QID. Last year we remained firm through earnings season, with the equities blowing off the first trading day of May. Extreme patience will be the watchword going forward.

If you don’t have good trade location, do not Trade.

You should take note that we’ve raised our stop in the Nasd and are looking at the 2750 area as pivotal.

Model Trading Portfolio…Current Holdings

………………                               Stop Close             Profit Points

Long QID/Short NASD             30.40                       33

Long GDXJ                              22                           23.57/ 24.79/25.88

Long Gold                              1645                         1st / 1695-1705…1740’s

Short Term View

We’re looking for the Gold to bottom.

We are placing a resting order to BUY NATGAS @ 1.70 ( Dr. Nenner’s Long term Downside Tgt.)

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!

Take what the market gives you , will be the order of the day.

Trade to Make Money!

Medium Term View…This will be updated next week for the 2nd Qtr.

30 yr. Bonds … 138.00 ish now becomes our macro pivot. Closing above this level would be short term positive the Bonds and negative the Equities. We will look to buy a multi-point break in the 30 for a rally into the fall in keeping with a general risk averse market theme.

Equities…While, we were in strategic buy mode for the first quarter, we now believe the market is fairly priced. The equity indices deserve a break. The operative question becomes, from what level and when can a break develop. We will monitor instruments on an individual basis vs. the general Risk On/ Risk Off correlation we saw last year, when most instruments traded via the theme of the day.

We’ve been doing this 35+ years…I’m hard pressed to recall a year when we haven’t gone back and attempted a re-test of the yearly close in the equity indices at least once. Yes, we are looking for a re-test over the next 5-4- months. Indices can still grind higher to the upper tgt levels over the next few weeks before profit taking ensues.

We are going to be highly flexible this qtr….we are not getting married to a central theme , nor are we getting into the long term prediction business. Having a bias is one thing, being patient and executing with a  defined risk parameter another. Our business is Risk Management.

Currencies…AUD/USD continues to be a good risk barometer. 102 is the near term macro pivot! ( This is a multi-year level) 111 is the upside pivot. Anything in between is just that, in between….no break outs! Closes above 105.30 would be deemed near term positive.