Last night saw some corrections in the Yen crosses, with EUR/JPY retesting the 200 day @ 105.93 and rallying. AUD/JPY…had the better bounce, however both have come up app 20-30 ticks short of anywhere is particular.

The feature has been Long the BTP ( Italian Bonds) vs short the BUND and 30 Yr. since yesterday.

Bunds…139.34-45 will be the key pivotal zone.

30 Yr. Bond….there has been very little price action overnight. I couldn’t tell whether they’re going to break a point or hold.

Just be aware of the spreads. SPU/BOND…DAX/BUND

Stocks rally?…Bonds & Bunds will break.

Oil & AUD/USD….Both need to sustain levels 20-30 ticks over last nights highs to convince me of further gains.

General Comments…

The miners do not act like they’re ready to go, however we’ll honor the double bottom pattern on the GDX ( the big miners) “We’re long the Juniors” with a J…GDXJ , and let the market prove us right or wrong.

Gold…could take into next week for some uuumpf..

As for the rest of the board, the game will be played out late day with GOOG earnings.

The less you do, the happier you’ll be today.

Model Trading Portfolio…Current Holdings

………………                               Stop Close             Profit Points

Long QID/Short NASD             30.50                       33+

Short EUR/USD                       131.66 GTC

Long GDXJ                                  22                            23.57/ 24.79/25.88

Long Gold                                  To Be Determined

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.