Spu’s…after putting in a lower low last night at the end of Asian session,markets reversed in Europe. Sustained action over 1375 will be positive.

NASD…same story, a lower low right into major Fib support “2650’s”

General Comments…

We tried the short side of Euro for the professional traders and are now out. The trade started out ok, but has gone nowhere.

Yesterday saw us reduce our shorts in the Equity Indices.

SPU’s...poor trade location coupled with little follow through, was a key decision point.

NASD…moved a 100 points from our entry into excellent technical support. Time to take some money off the table.

We’ll likely spend the next 2 days trying to rally in most risk assets.

Pay close attention to the 30 yr. Bonds…they have been the best indicator of future price action of the Equity Indices.

The 30 Yr.. has been moving close to a point at a time. Pay attention to Spu/Bonds…Bonds can break 1-2 points from here and be a short term buy.

Bunds…These can easily retrace to the low 139’s….think Dax/Bund…that means the Equities can rally.

Model Trading Portfolio…Current Holdings

………………                               Stop Close             Profit Points

Long QID/Short NASD             30.40                       33

Long SDS/Short Spu             1376 intra-day

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.

Copper…We’re looking to sell rallies in the Copper against a 377 weekly close. We regard this as an ancillary short to the general Risk Odd theme going forward into late this qtr.

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.