Crude has broken out of it’s recent $5 trading range. We will be adding the USO ETF to our Long portfolio on a dollar pullback in the Crude to anywhere near $100.50. We will use this as a surrogate to the Crude Futures.

The Yen and the Yen crosses are of interest again today. They are of particular importance because they foreshadow a risk on bias to the market.

Yen…a close below 128.60 in the (H) Futures is needed for an ORL day.127.79 is the monthly # ( app 78.30 USD/JPY) USD/JPY..77.80 ORH day. Both are trading around their 200 day mvg avg’s..( 78.05 ish USD/JPY….128.12 futures..)

“Futures traders should sell the Yen around 128.50-60 with a tight stop looking to buy either Canada or Aussie against the shorts to put on the spreads.”

EUR/JPY..a close over 103.22 puts in an ORH day

CAD/JPY…a close over 77.91 puts in an ORH day, with the 200 day App 78.30

GBP/JPY…a close over 122.94 puts in the ORH day with the 200 day app 124.32

Model Trading Portfolio…Current Holdings

………………Stop Close       Profit Points

Long XLE       71.60              80

Long OXY      102.40           110/117

Long DE        85.90

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.