Some pockets of shoppers are returning to the market. We notice that the current flock of shoppers are the more well-to-do shoppers who, had the cash, but who were saving it in case things got worse. Today, they are no longer worried about things getting worse and are again beginning to spend their cash. After all, the government has said that the recession is over, so, we guess they believe the propaganda that the current administration is publishing. Will this be enough to restart the economy? Probably not, because the middle class earners are still under financial waters and struggling to stay afloat. Purchases that are being made are based on need, discretionary spending is limited. Worse yet, those who have been burned by the decline in the wake of the Lehman mess are scared to do anything at all. Thus, they are, for the most part, not investing and sitting on negative returns in CD's or money markets.

Greece, Portugal and Spain all are having financial problems and, as members of the European Union, are pressuring the Euro. Perhaps this is why the US Dollar has been in rally mode. Remember, as the dollar rises, dollar based commodities and the US equities markets will fall. This is vintage John Murphy stuff. Re-read your Murphy books: The Visual Investor and his book Intermarket Technical Analysis. The market is behaving as he described it and the relationships are holding true.

Monday: December personal income/consumption is released at 8:30, December construction spending is released at 10:00 and January ISM index is released at 10:00.
Tuesday: pending home sales and home vacancies are released at 10:00.
Wednesday: January ISM non-manufacturing index is released at 10:00, and Challenger Gray & Christmas January layoff report is released.
Thursday: Both the European Central Bank and the Bank of England release statements and interest rate decisions, 4th quarter productivity is released at 8:30 and December factory orders are released at 10:00.
Friday: January non-farm payrolls and unemployment are released at 8:30 and consumer credit is released at 3:00.

The US Dollar index has a 9-count on the daily chart. We are overbought as measured by the indicators that we follow. That said, three of the four indicators are pointing to higher levels. Only the Thomas DeMark Expert indicator is curling over and issuing a sell-signal. The 5-day moving average is at 78.630. The top of the Bollinger band is at 79.46 and the lower edge is seen at 76.50. We are above the Ichimoku Clouds for the daily time-frame but are below the clouds for both the weekly and the monthly time-frames. We are overbought on the daily and weekly time-frames but not on the monthly time-frame. When there is a retreat in the US Dollar index, we expect to see support at 78.77 and at 78.22. There is an uptrend line for the Monday session at 77.801; the weekly uptrend line is at 77.752. We closed above the upper edge of the Bollinger band, for both the daily and the weekly time-frame, and likely will retreat from that level. The charts also tell us that it is likely that on a further rally to see the US Dollar index trade at 80.143. We do believe that this index will retreat or go sideways before the 80.143 level is approached.

The S&P 500 tested and bounced off the 1066.50 horizontal line on the chart. We are massively oversold by most measures. The stochastic indicator continues to issue a sell-signal as does the RSI, both are oversold. The Thomas DeMark Expert indicator is issuing a buy-signal and our own indicator is issuing a fresh sell-signal and is not oversold. We closed below the lower edge of the Bollinger band and likely will bounce from this level. Should the market rally, we will see some resistance at 1081 and 1087. The 5-day moving average is at 1100.63. The top of the Bollinger band is at 1169.05 and the lower edge is seen at 1072.04. We are inside the Ichimoku Clouds for the daily time-frame. We are above the clouds for the weekly time-frame but are below the clouds for the monthly time-frame. The monthly indicators are now issuing a sell-signal, finally agreeing with the weekly and the daily indicators. Should the market not rally here and now, we expect to see a visit to the 1026 area of support, below that level is 1012 and 991.25.

The NASDAQ 100 declined in the Friday session ending the week and the month at very oversold levels. The stochastic indicator, the RSI and our own indicators all continue to issue a sell-signal. The Thomas DeMark Expert indicator is issuing a buy-signal from oversold levels. We closed below the lower Bollinger band and we feel that this index will rebound to climb inside the bands again. The lower edge of the Bollinger band is at 1758.80 and the upper edge is seen at 1939.54. The 5-day moving average is at 1812.13. We closed below the Ichimoku Clouds on the daily time-frame. We are above the clouds for the weekly time-frame but are in the clouds for the monthly time frame. All time-frames are issuing continued sell signals with plenty of room to the downside on the weekly and monthly time-frames.

The Russell 2000 remains above the Ichimoku Clouds for the daily time-frame but is dangerously close to moving inside the clouds. This index has be a little less awful than the other indices. The stochastic indicator, our own indicator and the RSI all continue to issue a sell-signal. The Thomas DeMark Expert indicator is issuing a buy-signal at oversold levels. The 5-day moving average is at 619.57. The top of the Bollinger band is at 657.34 and the lower edge is seen at 602.98, a level we closed below. Naturally, we will either expand our volatility or will rally to close inside that level. When reviewing the point and figure chart, it is obvious that 599.20 has to hold or we will see much lower levels. We would expect to see some stability return to the market in the coming week. Just keep your seatbelt fastened.

Crude oil has been sliding and closed below the Ichimoku Clouds on the daily time-frame. We are inside the Ichimoku Clouds for the weekly and the monthly time-frames. The downtrend line for the Monday session is at 74.12, a level which must be removed to turn crude oil from negative to positive. The 5-day moving average is at 75.27. The top of the Bollinger band is at 85.12 and the lower edge is seen at 71.66. All the indicators that we follow herein are oversold and all are pointing lower. This market is oversold enough to expect crude to rally. The quality of the rally will tell us volumes about this market. Wait before taking a position and re-analyze after the bounce.

Gold retreated in the Friday session leaving an inside day on the chart. We held a very import level when gold held 1074.50. The 5-day moving average is at 1098.95. The top of the Bollinger band is at 1161.86 and the lower edge is seen at 1074.50. We are below the Ichimoku Clouds for the daily time-frame but above the clouds for both the weekly and the monthly time-frames. If we do not hold the current lows, we will see the market test 1042 and then1026 on its way to 984. Eventually 865 could be seen. The stochastic indicator is issuing a buy-signal for the daily time-frame. The other indicator are sort of going sideways and not really giving a signal. We will have to wait and see how much lower this market goes before issuing a real buy-signal. We feel that this market has been overdone on the upside and this retreat is a welcome one which will give rise to further rallies in the not too distant future.

Oil Market Summary for 01/25/2010 - 01/29/2010

Crude oil futures slipped below $73 a barrel for West Texas Intermediate late Friday as a temporary boost from strong GDP figures failed to last and let prices sink to a one-month low.

Earlier in the week, China, weak refinery demand and slumping tech stocks all conspired to keep energy prices low, with prices oscillating around $73 a barrel.

U.S. gross domestic product grew at a seasonally adjusted 5.7% annual rate in the fourth quarter, the Commerce Department reported on Friday, its fastest pace in six years. The previous quarter had registered growth of 2.2% and the year-ago period saw a downturn of 5.4%. For 2009 as a whole, GDP contracted by 2.4%, the worst record since 1946.

But analysts did not expect U.S. GDP growth to continue at the same pace in the current quarter, and concerns remained about China's growth after authorities clamped down on bank lending.

Capacity utilization at U.S. refineries stayed near the 20-year low reached the previous week (not counting hurricane-related shutdowns), and inventories of distillates continued to rise.

The dollar, which had firmed earlier in the week after President Obama's State of the Union message and the confirmation of Ben Bernanke for a second term as chairman of the Federal Reserve Board, rose to a six-month high after the GDP news, keeping downward pressure on oil prices. The euro, hurt by Greece's debt problems, dipped below $1.39 by Friday afternoon.

While most analysts remain cautious about economic prospects, Morgan Stanley put out an upbeat report on energy prices, forecasting that inventories would start to fall sharply in the second half of the year or OPEC would increase production on the back of stronger economic growth, particularly in emerging markets. The bank predicted a price of $95 a barrel for crude by the end of this year, $100 for 2011, and $105 for 2012, well ahead of consensus estimates.

The Morgan Stanley analysts noted that demand for gasoline alone in China and India continues to grow despite economic sluggishness.

In Davos, too, oil executives talked their book, making the case that there is simply no substitute for oil and the world economy needs more energy.

Oil prices emerged from the week somewhat battle-tested, analysts said, having withstood a sharp drop in prices of copper and other base metals on Thursday, as well as weak equities and a strengthening dollar. But weak demand continued to weigh on the market.

This article was written by Darrell Delamaide for Oilprice.com who focus on Fossil Fuels, Alternative Energy, Metals, Oil Prices and Geopolitics. To find out more visit their website at: www.oilprice.com

Any trader who tries to pick tops or pick bottoms is destined to fail. When we buy/sell clients a commodity it is not because we are picking a bottom or top but rather we think either the commodity is undervalued or overvalued so we are looking for a move in the coming hours, days, weeks or months. Oil closed down today near the weekly lows not a great end to the week but we remain confident that this is a good level for traders with a time frame over 4 weeks. As we've voiced we feel we are close to turning higher and expect $80 before the May contracts expire. Aggressive clients started buying natural gas with stops below the weekly lows today. We prefer May call spreads and will have some ideas next week.

The rally I was waiting for to sell the ES and S&P may not come; some of our more aggressive clients are short and I commend them for their bravery. We see resistance at 1082 and support at 1055 followed by 1030. Cocoa was lower by 2.3%, those short look to book profits on trade below 3150 next week. We should know Monday if sugar will correct or not as prices took 3 attempts at 30 cents this week and failed. Clients that hold calendar spreads were advised to buy May call protection against a breakout to new highs. OJ was lower by 5% today though the trend line that has held since October is still intact on the May contract. If that level gives way we may cut losses on client's options next week. March silver held $16/ounce again today and gold was only lower by $2. This in not too bad considering the action in outside markets. Our sentiments have not changed. Euro-dollars end the week back at pre Fed levels; we still suggest lightly scaling into shorts or buying long dated puts.

Clients have no exposure yet in soybeans or soy meal so we welcome the slide lower but corn down 1.5% we do not like as much. December is trading at the lowest level since the first week of October; we're suggesting getting long. Clients went flat on their June live cattle at a small profit; there is too much uncertainty presently. On a break we would look to re-enter bullish plays. Continue to sell rallies in the Pound. Clients took off their Aussie puts today in the morning at a small loss on the Q4 GDP#. I am impressed with the dollars strength this week but moving forward expect a sideways 77/80 cent range NOT the appreciation we've seen.

Risk Disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.

US DEBT REVIEW AND OUTLOOK

US TREASURIES continued to range trade, with overnight rallies in Asian equities finally allowing for the long end of the yield curve to make a downward push through near term support levels. Treasuries regained footing after equities continued their uptick in volatility (see what happens when the news keeps harping on the fact that volatility has hit a low point).

Weaker than expected readings on US durable goods numbers and weekly unemployment claims slammed the major equity indices down to their worst levels of the year. Money coming out more risk sensitive sectors continues to find its way into the short end of the yield curve. Fixed income traders appear to be favoring a strategy of locking in funds at short term rates in order to seek opportunity through the lending out of funds at oncoming variable rates which are expected to rise as emergency liquidity programs end and the germination of a normal interest rate policy begins within the next several years. After effects (or shocks) of this strategy could lead to continued downward pressure on fixed income prices, while volatility begins to increase as uncertainty regarding the security of government fixed income continues to come into question.

Technically, US 30 years broke through initial support at 117-30 overnight. The pattern of the market suggests that it is getting ready to stage a breakout of its monthly trading range. The contract appears to be setting up for a move to the downside for a test of 117-12, with 116-28 setting up as significant support. Watch out for upside breakout point of 119-24. This could result in a gathering of upward momentum and reversal of downside sentiment.

US EQUITY REVIEW AND OUTLOOK

Stocks apparently had to deal with a major case of indigestion on Thursday, resulting in the major equity indices closing at their worst levels since the Dubai World debt scare in November of 2009. Disappointing numbers on employment and US durable goods weighed on already shaken investor sentiment as last night's State of the Union address failed to offer solid direction for economic recovery.

Growing concerns regarding a possible new contagion of sovereign debt concerns continues to erode risk tolerance as the Euro Zone struggles with Greece's inability to work out its fiscal and monetary weakness. The inability of the Euro Zone to implement a cohesive solutions highlights the apparent weakness of the union, while the growing of US government, rather than proactive economic policy appears to be prompting equity investors to undertake a "buy the rumor, sell the fact" mentality, particularly as volatility (no, it did not go away just because the news said it retreated below the Pre Lehman collapse levels) returns to the forefront creating a traders environment.

TECHNICAL OUTLOOK - With March S&P futures closing below 1081.00, the contract is setting up for a possible test of the next support level at 1068.00. A break of this level may result in a challenge of 1062.00 and a key support level at 1059.00. Upside retracement will likely be subdued ahead of next week's employment data. Expect initial resistance at 1089.60.

Prepared by Rich Roscelli & Paul Brittain, contact: rich@binvstgrp.com
Additional Information can be found at www.whitehallvegas.com

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Whitehall Investment Management, its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Gazprom faces regular opprobrium for its bullying ways of using energy as a pressure and political tool. Seen by some, mostly Russians, as the symbol of a successful and strong Russia, others see it as a dominating juggernaut, economic right arm of the Kremlin implementing, or should we say, imposing its policies by using energy as a weapon.

Just like Louis XIV used to say "L'Etat c'est moi" (I am the State), Gazprom could say the same in light of its commercial power and the unconditional governmental backing it enjoys. However, just like Monsanto generates passionate debates with its genetically engineered seeds, Gazprom's activities cannot be simply labeled as right or wrong and subject to final judgments.

Though far from being an angel, Gazprom is not necessarily a demon either. It is easy to point fingers and to forget that oil & gas is a merciless sector where every major is trying to position itself for the next 20 to 30 years and secure predictable supply and demand at home and abroad. After all, large Western energy companies were not born nice and proper. It took decades for codes of conduct, tacit or written, to be adopted and enforced. It is also easy to forget that all energy companies have in mind the interests of the country they come from.

Why would it be any different for Gazprom? And why should Gazprom take upon itself to act differently if it can get away with what it does and not be sanctioned by its own government?

The main issue with Gazprom could be summarized by using the famous quote of U.S. Secretary of Defense Donald Rumsfeld who said about Iraq "there are known unknowns. That is to say, there are things that we now know we don't know. But there are also unknown unknowns. These are things we do not know we don't know." Because of all the things we do not know about Gazprom, sensitivity to what Gazprom does is greater because ultimately what it decides to do today and how it does it will impact energy supplies for years to come and how the game is played.

The lack of information on the personal relationships between the business and political world, on its exact ownership structure, on the exact identity and role of business intermediaries, on the flow of money through a labyrinthine network of offshore and shell companies, and on the overall exact modus operandi of Gazprom is what leads Gazprom to be subject to greater scrutiny and interrogations. It efforts to maintain an export monopoly for gas flowing to Europe and Asia at a huge cost, possibly over-committing dwindling resources at a time of lower energy prices and lower needs from consumers is another concern as would happen if Gazprom was to fail?

Stochastics are putting in a rounding bottom and though we've not recommitted capital in futures with clients we still recommend accumulating call spreads in May as oil should be turning higher very soon. Looking at the chart formation we could be forming a "W" which predicts a trade back above $80 in the next 90 days. Just my opinion others may see it differently. Natural gas traded below $5.10 in March and was rejected but we would suggest further evidence before trying to catch this falling knife.

In Monday's commentary we will post a few long trade suggestions. We will see on the close but at the moment if we were to close at these levels I see a bearish engulfing candle on the daily chart in Indices. Some or our clients started shorting the ES today; we suspect a bit premature thinking a trade to 1125 is feasible. At that level we suggest short exposure. OJ prices were lower by almost 2% today; clients remain long and still need higher pricing to reach their profit objective. Sugar was higher by 2.25% though we are still anticipating a breach of the 20 day moving average and more downside before re-establishing longs for clients. I was impressed with the action in metals today; gold closed $14 off its lows back above the 50 day moving average and silver was unable to break $16/ounce paring its losses but still closing below the 100 day moving average. Because the mixed signals we maintain only having light long exposure.

Love the action in corn today as the 61.8% Fibonacci level held and a base looks to be forming. Clients are buying May and July calls and December futures. Expect to see some bullish recommendations in soy meal and soybeans in Monday's commentary as well. Would've liked to see some follow through in the Euro-dollar today. Continue to scale into shorts at these levels. If the 20 day moving average holds into the weekend in lean hogs we most likely will suggest bullish exposure in April...stay tuned. As for live cattle clients are long June futures with put option protection. We've yet to make any plays for clients in August but you will know when we do. Continue to sell rallies in the Pound; some clients scalped 85 ticks today! On a challenge of 88 cents tomorrow in the March Aussie we suggest taking off your puts. The US dollar has gained 7 out of the last 10 sessions and we do NOT think it is sustainable. We are not suggesting shorts but if prices rollover the Ag's, energies and metals could appreciate swiftly...trade accordingly.

Risk Disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.

This week in Gold has thus far produced a very volatile $26.50 range encompassing
a high of $1104.00 and a low of $1074.50.

The Gold and Silver have been under siege for the most part due to the continued U.S.
Dollar strength versus the Euro. The European Stock Markets have experienced losses do primarily to the uncertainty of the fiscal responsibilities and budget debts in Greece, Portugal, and Spain. This scenario Has weakened Euro and fueled the recent U.S Dollar momentum.

This week has also revealed the possibility of the Bank of China restricting its lending
practices even further to increase its reserves as well as helping to curb pending inflation. Since Gold is considered a "safe haven" during inflationary times the raising of rates or the tightening of credit is seen as "anti' inflationary.

President Obama has also proposed to restrict U.S Bank lending procedures which
sent Bank Stocks, Wall Street, and the precious metals spiraling downward last week and the affects are still being felt in the financial industry.

As expected the Presidents "State of the Union" address covered the unemployment, housing, and health care problems we face here in America. These are very
important issues that need resolving quickly. Despite our nations economic woes it is apparent our Dollar has become the currency of choice as we witness the Dollar trading stronger versus the Euro on a regular basis these days.

***NO RATE HIKE FROM FOMC***

The recent Dollar strength has continued to make Gold less appealing for hedge funds, money managers, and the investment community in general. However, the Asian sector of the world has continued its insatiable appetite for the yellow metal. It is my opinion they are buying every dip in price and are using the price of $1045.00 as a stop-loss exit. If you recall almost 3 months ago the Central bank of India purchased 200 metric tons of Bullion from the IMF at the $1045.00 level.The IMF still has 200 metric tons
of Bullion for sale.

The demand for physical demand is at a frenzy pace in China. The citizens of China have truly been bitten by the Gold Bug. In the rush to own Gold it has been reported that on busy days 10,000 people pass through the doors of Caibai (the number one place to buy Gold in China) to purchase Gold. The Bank of china has 1200 metric tons of Bullion presently in its reserves. It has made a commitment to increase that amount
to 10,000 metric tons over the next 10 years.

I expect the volatility to continue in the precious metals. Especially when you have rising budget deficits globally. Eventually you have to wonder if or when investors will Lose their confidence in these affected currencies and Choose a "safer haven" investment...(PRECIOUS METALS).

Lets Talk Gold!

Mike Daly / Gold Specialist
PFG BEST
mdaly@pfgbest.com
877-294-4669
312-775-3014
312-563-8029

*there is extreme risk trading futures,options,and forex*

Corn is heading into a seasonal trend of higher prices as the uncertainty of planting season should offer opportunity for price increases going into the next several months. Technical indicators are also offering support to a rebound in prices. To take advantage of this price turnaround; Buy the July $4.00 call, Sell the July $4.50 call, and sell the July $3.40 put. The trade looks like it can be done for a payment of $50-$100 plus commissions (there will be 3). Maximum profit on this trade will be $2500.00 minus premium paid and commissions. The trade has unlimited risk under $3.40, where it will have the same risk as a long futures position.

March Japanese Yen futures are showing signs of technical weakness from its 2010 rally. We feel that most of the lower yielding currencies (US Dollar, Japanese Yen) are due for a pullback. To take advantage of this possible retracement, buy the March Japanese Yen 110 put, sell the March 107 put, and sell the March 116 call. The trade can be done for a payment of around $100.00 plus commissions (there would be three). If you wish to be a little more conservative, sell the 117.00 call, which would bring the cost of the trade up by about $100.

The maximum profit on this trade is $3750.00 minus what is paid on the trade plus commissions. The trade has unlimited risk above the 116.00 level in the March Yen contract.

March 30 year Bond futures continue to struggle with technical resistance. With supply issues and deficits continuing to weigh on buyers sentiment, we are expecting another pullback to the downside of recent ranges. To take advantage of this opportunity, we like buying the March 30 year 118 put, selling the March 116 put, and selling a March 121 call. The trade can currently be done for about $100.00. The maximum profit on the trade is $2000 plus any credit you might receive, minus commissions (of which there are three). Risk occurs above the 121 level in the March 30 year contract, where you will have the same risk as being short a March 30 year futures contract.

Please contact us with any questions or if you need assistance putting this trade together - email paul@binvstgrp.com

Paul Brittain
Whitehall Investment Management
Commodity Trading School
877-270-8403

Past performance is not indicative of future results.

The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities.. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

March corn futures at the Chicago Board of Trade have suffered serious near-term technical damage the past two weeks. The damage began with a limit-down (30 cents) price move on January 12. The following day, price action produced a rare gap down on the daily bar chart as prices fell to a fresh three-month low. Price action in March corn futures then saw a pause--sideways and quieter trading--as traders caught their breath following the strong downside price pressure. Pauses after a big price move generally are followed by a price move in the same direction as the bigger price move.

March corn this week has fallen to a fresh 3.5-month low of $3.60 1/4 a bushel. The next downside technical objective for the bears is to push and close prices below solid chart support at $3.50 a bushel. It would take a close in March corn futures back above strong chart resistance at the $3.73 level to begin to provide the bulls with some fresh upside technical momentum that would then hint a near-term market low is in place. Stay tuned! Jim Wyckoff

After an eventful overnight session, Treasuries closed the session near unchanged as traders look forward to tomorrow's interest rate decision by the Fed.

As for today, there was little news and therefore little action. The Case-Shiller home price index dropped by a larger than expected 5.32% while consumer confidence data showed an uptick.

The 2 year note auction was a little on the weak side, but wasn't enough to give the bears an edge ahead of tomorrow's events. The Treasury issued $44 billion in 2-years at .88% with a 3.13 bid to cover and an indirect bid of 43.1%.

We were right about our assumption of another retest of the highs in the March T-Bond futures, but tomorrow's call is a bit tougher. Our resistance area near 119'09 seems to continue to be valid, along with our mid-to-low 118 resistance in the note.

Support in the long bond comes in near 117'18 and then again near 116'011ish. If you are trading the note, look for support near 117'06 and then again in the mid-116's.

Treasury Bond and Note Option Trading Recommendations

**There is unlimited risk in naked option selling.

January 20 - Our clients were recommended to sell call options this morning against the rally. Specifically, we like the idea of being short the March 30-year bond 121 calls. Fills were being reported anywhere from 23 to 26 ticks or $395 - $406.

Treasury Bond and Note Futures Trading Recommendations

**There is unlimited risk in trading futures.

Flat

Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
cgarner@DeCarleyTrading.com
1-866-790-TRADE
Local : 702-947-0701

www.DeCarleyTrading.com
www.CommodityOptionstheBook.com

*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.

There is substantial risk of loss in trading futures and options.

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Be cautious this week is going to get volatile! Day 1: the trend line held in oil today though it is too early to call for a reversal. A double bottom could be forming form yesterday and Fridays low; that level is just above $74 on the March contract. The only exposure our clients have is May $78/85 call spreads to take advantage of the $4-6 pop we anticipate in the immediate future. The fact that equities did not follow through lower was a positive but we still like selling rallies for clients. Prices may not get their but we suggest selling a rally in the ES and S&P between 1125/1135 on the March contract.

Expect fireworks this week with a full schedule of economic indicators both here and abroad. As for softs cocoa should move lower but we've yet to find the most advantageous way to position clients. Sugar did briefly trade above the 30 cent/lb level managing to close 3.5% higher on the day. On a similar move tomorrow we will most likely suggest profit orders on clients May call exposure. We are getting close to crying "Uncle" on the calendar spreads (short March /long July.) Clients are down just over $1000/per. OJ was higher by 2.5% today, clients should reach their profit objective on a trade above $1.50 this week. Gold and silver initially stood the test of support today; we suggest light long exposure looking to add if the market proves you right. Clients started buying June $1100/1225 Call spreads today at $3750-3800/per. We bought NO silver today; clients currently own out right calls and bull call spreads in May contracts. Continue to buy May and July calls and December futures in corn.

We could not resist the opportunity in the Pound as prices were up 0.70% on retail sales but the numbers did not look that good. We suggest selling rallies; we would only re-examine the trade on 2 consecutive closes above 1.6300 in the March contract, our target is 1.6000. Live cattle were lower but not enough in our opinion to exit puts or to start buying futures, on a breach of the 20 day moving average selling should intensify. Lean hogs were lower by almost 2% today; we feel there is more downside to come and have advised clients to hold their April puts.

Risk Disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.

This week the Gold market experienced a monumental sell-off causing the Gold and to settle below the psychological $1100.00 level the first time since December 31, 2009. During the week we traded as high as $1141.00 and as low as $1081.90 settling at $1089.70 for the shortened trading week.

The Gold market has been pressured from several Global concerns recently.

(1) The Central Bank of China deciding to raise interest rates .50 basis points in an attempt to set aside reserves and help to curb pending inflation. Since China is dedicated to building its Gold reserves from 1,200 tons to 10,000 tons over the next 10 years obviously they would prefer lower prices ...if indeed they are intending to purchase the remaining 200 metric tons of IMF Gold. As you may recall The Central Bank of India purchased 200 metric tons of IMF Gold two months ago...($1045.00)...

(2) The Euro slipping to six month lows, pressured by concerns over Greece's swelling budget deficit. This has helped to strengthen the U.S Dollar versus the Euro. A stronger Dollar makes Gold less appealing as an alternative asset

(3) President Obama's Administration proposal for stricter limits on financial risk-taking sent the Gold, Bank shares, and Wall Street on an "avalanche sell-off.

Despite all the negative news for the Gold market selling off over $50 for the week as a Gold bug I certainly realize it could have been much worse.

The Rupee of India has fallen to its lowest in two weeks. A weaker Rupee makes the U.S Dollar quoted Gold expensive. This has caused the jewelers of India to buy less aggressively. However the demand for physical gold is always insatiable.

The people of India have always understood the allure of Gold. It represents prosperity and a symbol of wealth that has always retained value. Unlike Commodity traders who buy and sell in hopes of a quick profit the the citizens of India are thought to own 12% of all Gold ever refined. Gold is the gift of choice during their many festivals and wedding seasons.

Silver has also taken a beating this week as Global concerns that affected the gold simultaneously affect the Silver. Just one short week ago it looked like Silver was prepared to make a run toward the $20.00 level instead the Silver settled at $16.92 for the week.

With government budget deficits on the rise globally it would appear to me that investors would begin losing confidence in affected currencies and seek "safer havens" especially gold and Silver.

Mike Daly / Gold specialist
PFG BEST
mdaly@pfgbest.com
877-294-4669
312-775-3014
312-563-8029

*there is extreme risk trading futures, options, and forex*

New measures by Chinese authorities to curb bank lending reversed a rally in energy prices early in the week, bringing West Texas Intermediate futures down more than 4% in the second half of the week to below $75 a barrel by Friday.

China continued its efforts to slow down its economy and prevent overheating, and told some banks to stop making certain kinds of loans. The Chinese move on Wednesday hit all commodities across the board, from gold to lead, with the prospect of slower economic growth in the country.

Not even the news that China's oil imports in December exceeded 5 million barrels of oil a day for the first time could stop the decline.

U.S. data, meanwhile, showed that demand for oil had slipped 1.8% in the four weeks leading to Jan. 15 from the like period a year ago, when the U.S. economy was in the grip of a recession. Crude inventories declined in the week, against expectations, but gasoline inventories rose. Continued milder weather in the Northeast further dampened heating oil prices.

News that utilization of U.S. refinery capacity fell to its lowest levels since the 1980s drove home the point that demand for distillates was lagging. Refinery utilization in the previous week dropped 2.9 percentage points to 78.4% of the 17.6 million barrels per day total capacity, the lowest level in two decades except for periods when hurricanes shut down refinery operations.

The U.S. and China are the world's top two oil-consuming countries, so the signs of weakening demand in both were bearish for energy prices.

As if all that wasn't enough, the announcement by the White House on Thursday of tough new measures to limit banks' proprietary trading threw a double whammy in energy markets. There were concerns that Wall Street banks, among the biggest energy traders, would have to cut back their activities. Plus, the news sent equities into a tailspin, and dragged down commodities prices.

The uncertainty about U.S. bank restructuring reversed the dollar's climb against the euro, which had also weighed on crude oil prices. After dropping below $1.41, the euro bounced back up above that level at the end of the week.

But continuing concerns about Greece's debt and new uncertainty about whether Ben Bernanke will be confirmed for a second term as Federal Reserve chairman supported the dollar and were likely to dampen any strong rise for the euro, analysts said.

Originally published at: http://www.oilprice.com/article-crude-oil-prices-fall-victim-to-china-syndrome.html

By Darrell Delamaide for OilPrice.com who have recently launched a Free Market Intelligence Report which focuses on unique Geopolitical and Investment News which enables readers to spot trends and events in the marketplace and reduce investment risk. To find out more visit: http://www.oilprice.com

US Debt Review and Outlook

US TREASURIES gained as traders sought shelter from the storm as equities posted their worst one day drop since October 2009. US dollar strength, benign inflation data (PPI excluding food and energy prices posted lower than expected), and a weaker than expected reading on US housing starts set up a foundation, while the flight from risk on the back of disappointing earnings results from BOA (How will the revenues sustain when no one wants to borrow?) prompted a flight to security.

US Treasuries were also buoyed by China's implementing additional tightening of bank lending standards. The Euro zone contributed little in the way of calming influences as Greece had to step up and publicly deny rumors that it might be seeking to exit the European community as a means of addressing its monetary crisis. Look like cracks in the European community may continue to surface (Note how each country essentially took an "everyman for himself attitude with regards to the initial dealings of the global financial crisis- are not events such as this the type of challenge that the European community was supposed to step up and confront as an entity of strength?) The Euro plummeted along with most commodity based currencies as the sector took a major hit in the wake of China's perceived slowdown.

As a result, the US Treasury market appeared to be the belle of the ball today. This may change on Thursday, when the complex gets a reminder of its own shortcomings-supply, supply, supply- as the announcements for next week's 2, 5, and 7 year note auctions come out on Thursday.

Technical Outlook - US 30 year March contract managed to rally above resistance at 117-30. Upside movement looks to be getting tired and could result in pullback to 117-19. Still expect strong resistance to be found at 117-19, while near term support sets up at 117-00.

US Equity Review and Outlook

The major stock indices reversed from yesterday's rise as banking shares, already a suspect sector, posted earnings that failed to overcome the global sentiment that recovery is set to face some significant challenges with regards to stability and sustainability. The major indices briefly moved through technical support as housing starts came in weaker than expected. The market took its early cues from BOA, as the bank took a great than expected hit from its payback of tarp funds. Most of the sector recovered to finish in positive territory by late session, lifting stocks off their lows as technology and material sectors fell on profit taking and renewed concern regarding China's reigning in of credit to forestall excessive, unsustainable growth. The influence of these actions may begin to wane in their influence as well.

Technical Outlook - March S&P futures briefly broke through target support at 1126.00, before rebounding to close above bottom end of range at 1132.00. Expecting the market to continue range trading, with possible upside top at 1152.00. Initial resistance at 1142.00. Support for the support shifts slightly lower to 1124.00, with 1122.00 and 1118.60 as downside target levels

Prepared by Rich Roscelli & Paul Brittain. Contact rich@binvstgrp.com

Additional Information can be found at www.whitehallvegas.com

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Whitehall Investment Management, its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

March soybean oil futures at the Chicago Board of Trade are presently in a strong three-week-old price down-trend on the daily bar chart. Prices have sold off sharply, scoring a fresh 2.5-month low on Tuesday, after hitting a fresh seven-month high of 41.91 cents a pound in early January. The soybean oil bears have solid near-term technical momentum and their next downside price objective is to push and close March futures prices below solid technical support at 36.35 cents. Above that is located chart support at the November low of 36.95, at 36.75 and at 36.50 cents.

The bean oil bulls would begin to regain some upside technical momentum by producing a close above technical resistance at 38.00 cents, basis March futures. Below that level is located chart resistance at Wednesday's overnight high of 37.55 cents. Soybean oil traders will continue to keep one eye on the crude oil futures market. Crude is an important "outside market" that has had a strong influence over the bean oil market. Crude oil's recent sell off has helped to press soybean oil futures lower. Stay tuned! Jim Wyckoff

Pay close attention to the relationship between different asset classes and even different commodities, i.e dollar, oil, and metals. Our second objective at $77 in February Crude was reached today but prices did not stay there for long as oil reversed closing above $79/barrel. We suggest covering all remaining shorts and have yet to get clients long but we may have some bullish strategies to come. We still want to see a lower print in natural gas before issuing any buy recommendation, for those brave souls who remain short stay the course. For all energy contracts start following March as February goes off this week.

All losses in Equities were gotten back today on the major indices?? As we said in last week's blog and this morning's commentary we think a correction is long overdue but look for a close below the 20 day MA to confirm. So much for a reversal...sugar was higher by virtually 5% today. Those long the May contracts love the breakout to a new closing high but the calendar spread we advised got creamed losing 65 ticks ($728) per spread. As painful as it is we remain in the trade with clients for now. Clients were advised to roll out of their March longs in silver today and move to May. We like the idea of having 3 months time vs. 1 month as we do not have a good feel for price action in the immediate future. As for gold same story prices in the immediate future could go either way so we would scale down your position size until things are clearer. We remain longer term bullish to both metals. After the 12% correction in corn from last weeks USDA report we like being a buyer of May and July calls and December futures.

Continue to scale in to short exposure in Euro-dollars out till' December 10′ and March 11′. As for currencies we're getting the dollar rally we expected and forecast; see recent blogs. As for positioning clients are short March BP futures and were advised to buy March 94 cent CD puts. The BOC left rates alone at 0.25% today. Clients exited their February live cattle calls today, with only 17 days we could not weather a correction. We are still bullish but suggest June or August exposure. Clients hold a small position short April puts in lean hogs and on confirmation of an interim top we may suggest futures...stay tuned.

Risk Disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.

Crude oil futures fell for five straight sessions as warmer weather in the U.S. dispelled forecasts of unusually low temperatures and allowed concerns about demand to come to the fore. The price for Nymex's West Texas crude fell about 6% during the week, starting at nearly $83 and finishing at $78.

Analysts said that the unusually cold weather had supported prices with a "winter premium," as added heating demand compensated for lower demand in transportation due to slow economic recovery.

Even a report early in the week that China's energy imports had registered a big jump in December failed to help, as it was quickly followed by moves at the Chinese central bank to tighten credit and slow down economic growth.

Further bearish news came on Wednesday with the report that U.S. inventories of crude oil had risen by 3.7 million tons in the week, three times more than expected.

Then the coup de grace came on Friday as the International Energy Agency failed to raise its forecasts for global oil demand in its monthly oil report, saying that the cold weather wasn't sufficient to increase demand projections.

"Oil demand recovery in the OECD will likely remain sluggish, despite a bout of recent cold weather," the agency said.

Even so, U.S. industrial production figures for January posted their sixth straight increase on Friday, coming in slightly higher than expectations at 0.6%, and this helped trim some of the losses on the crude contract.

Some analysts found comfort in the fact that the decline in crude prices was not greater, seeing this as a sign of resilience. Goldman Sachs reiterated its forecast that West Texas crude would average $90 this year and rise to an average $110 in 2011. The bank said demand from emerging economies would make up for the sluggishness in the industrial countries.

The IEA echoed this sentiment in its report. "Growth is driven by non-OECD countries, most notably in Asia," the IEA said.

A move by the U.S. Commodity Futures Trading Commission to impose position limits had no impact on trading. The proposed limits are generous enough that only the very biggest traders will have to pay attention to them, analysts said.

Heating oil and gasoline prices trended down with crude. Natural gas benefited from bargain hunters on Friday to claw back some of its losses for the week, ending up for the day.

Originally published at: http://www.oilprice.com/article-oil-prices-fall-as-winter-premium-melts-away.html

This article was written by Darrell Delamaide for Oilprice.com who focus on Fossil Fuels, Alternative Energy, Metals, Oil Prices and Geopolitics. To find out more visit their website at: http://www.oilprice.com

Today's Gold Session Settles $12.50 Lower... ($1130.50)

Gold prices dropped today as the U.S Dollar reversed yesterdays losses versus the Euro. Gold also was pressured as a result of CFTC Chairman Gary Gensler's intentions "to discuss possible position limits on gold and silver contracts at a March meeting.

The U.S Consumers Confidence rose less than expected (0.1 %) in January. This is certainly not a surprise as our U.S jobless claims are on the rise again. The CPI number indicates the economy is growing. However the average consumer is worried about job losses, high unemployment, and the high foreclosure rate.

JP Morgan Chase & Co. reported a fourth Quarter loss in its retail Banks, (1.6%)...
This started the Stock Market sell-off and also added fuel to the Gold markets decline.

Their has still been strong physical demand In Asia as lower prices have ignited buying
interest from Jewelers in India who are busy taking orders from customers in Dubai.

The Gold market has certainly come under fire this week...(1) central bank of China raised Its rates .50 basis points... (2) The CFTC is considering position limits for gold... (3) JP Morgan's fourth quarter loss....And yet we are still trading around the $1130.00 level. VERY RESILIENT ....

MONDAY IS A HOLIDAY... IN OBSERVANCE FOR MARTIN LUTHER KING JR.

My SWING numbers for 1/19 Tuesday...February

RESISTANCE # 2..........$1150.00
RESISTANCE # 1..........$1140.00
PIVOT.........................$1133.00
SUPPORT # 1...............$1124.00
SUPPORT # 2...............$1116.00

Mike Daly / Gold specialist
PFG BEST
mdaly@pfgbest.com
877-294-4669
312-775-3014
312-563-8029

*there is extreme risk trading futures, options, and forex*

March soft red winter wheat futures at the Chicago Board of Trade have seen serious near-term technical damage inflicted following a sharp price decline on Tuesday. Now, a down-trend line on the daily bar chart can be drawn from the November, December and January highs. The wheat market bears have gained fresh downside technical momentum this week, and would gain more by producing a close below strong chart support at the December low of $5.14 1/4. Below that level lies major psychological support at $5.00 a bushel. Above these price levels is located technical support at Thursday's low of $5.27 1/4, at $5.25 and then at this week's low of $5.19 1/4.

For the wheat market bulls to gain fresh upside technical momentum to suggest a fresh uptrend can be sustained, they would have to push and close March futures prices above strong chart resistance at this week's high of $5.75 a bushel. Below that level does lie technical resistance at Thursday's high of $5.37 1/4, at $5.45 1/4, at $5.50 and then at $5.60. Stay tuned! Jim Wyckoff

Investors who positioned their portfolios thinking the Bull market in commodities was over were proven wrong in 2009. Several commodities saw multi-decade highs & a majority of commodity sectors showed above average returns as seen in the attached chart. There were a few standouts; Copper was higher by 140% trading back to levels seen in the Summer of 2008, sugar was helped by a world deficit and rose by 130% and it has since reached 29 year highs, finally RBOB prices almost doubled. We don't want to cherry pick just the best performing commodities and to be clear there were no clients of MB Wealth that bought these three commodities at their lows and held them throughout the year. The point I'm trying to make is that the commodity bull is alive and well and investors should diversify a portion of their portfolios and allocate anywhere from 5-20% of their investment capital to this asset class.

We feel that with governments around the globe flooding the system with money and as long as some form of a global recovery starts to take foot there could be substantial appreciation in a variety of commodities. I feel it necessary to point out that commodities are not only long investments as well there are a number of trades we did last year that we speculated on commodity price depreciation.

Find below the highlights by sector we saw for 2009.

Agriculture: Corn was a tale of two stories: farmers planted what looked to be the second largest crop in history, however the problem was the crop went in late due to inclement weather and we had one of the latest harvests in three decades. This should translate to a sizeable crop but the quality should be less than present forecasts. As for trading the markets after hitting a 3 ½ year low in the fall, MB Wealth has had a "buy the dips" mentality. Prices have bounced almost $1 off their lows and after a mild correction we expect to see another leg higher. As for the soybean crop, they too went in late, but as opposed to supply being the story in 2009 it was more the considerable demand for soybeans out of China that was the main price driver. Soybeans had a much larger trading range on the year with prices for the most part moving in a $3 trading range between $8 and $11 on the year. Moving forward we would suggest being a buyer closer to the $9/bushel level. The record high prices in wheat in 2008 did their job by causing farmers around the globe to shift more acres into wheat to prevent a re-occurrence of the 2008 price spikes. The high was made last year right around Memorial Day and after that prices traded lower until they bottomed in the fall and started to creep higher. Since then wheat has been range bound and unless scalping it, wheat really has not seen the movement other Ag's have seen. Being there was no defined trend the only large trades we've participated in for clients is long KCBOT wheat against a short in CBOT wheat which has yet to work. We expect KCBOT to trade at a premium to CBOT but to date it has been the other way around. All in all 2009 was a good year in agriculture but it was a tough act to follow after seeing record highs for most products in 2008.

Softs: As we indicated in last year's report this sector remains one of our favorites and commodity investors need to start paying more attention. To steal words from the infamous Rodney Dangerfield "Softs" get no respect. That is not to take anything away from the other markets, but let's get real, a 30 year high in cocoa, a 29 year high in sugar, a freeze in Florida that carried OJ to 2 year highs (this happened in early 2010), this sectors merits your attention. Value investors should love sugar because although 2009 saw a major price increase, sugar has traded double its current price. Are we forecasting that in the immediate future...NO but we do not see a top yet. We've pointed out a number of times that cocoa tends to track the British pound and have an inverse relationship to the US dollar; compare their historic charts and you will find it fascinating. For several years the US planted smaller and smaller cotton crops and though the demand has not really been there, cotton enjoyed a steady rise in price last year. This is one of the markets we did not really take advantage in 2009 and will try to in 2010. After bottoming early in the year cotton did not look back and traded from a low under 50 cents to as high just around 75 cents; a move of 50% with very little give back. Not every trade was a winner but we successfully navigated coffee from the long and short side in 2009 for clients. In 2009 when prices approached $1.20 it was a buy and as prices approached $1.40 it was a sell. What will 2010 bring?

Metals: Gold to silver, palladium to copper, metals surely grabbed the headlines last year and rightfully so. Gold was higher by 24%, silver by 48%, palladium 116% and copper a whopping 139%. Prices of copper, even at their highs, were a far cry from their 2008 highs but if the global recovery continues and the infrastructure build out picks up, this market could have further upside. I learned several years ago when I felt copper looked toppy at $1 that I am incapable of picking a top. We trade very little copper for clients but we do use it for a barometer on the overall health of the economy. Translation - we use copper as a guide to help navigate in other commodity markets. Gold started the year off high and only got more expensive as the year progressed trading to an all-time high in the first week of December. We remain bullish gold, but now with prices at elevated levels expect larger swings; a 10% move from $1200/ounce is much different that a 10% move from $700/ounce. Silver tends to follow the same trajectory of gold but it is a bumpier ride. Silver is not viewed solely as a precious metal but also as an industrial metal which could contribute to its amplified volatility. Silver's appreciation in 09' was impressive but being we've yet to get back to levels seen in early 08' we think silver needs to play catch up to the "yellow metal." The gold to silver ratio which will be discussed in more detail in our 2010 outlook still remains out of whack compared to historical norms. Past performance is not indicative of futures results. We trade very little palladium but after seeing the movement in recent years it will be a goal of mine to perhaps delve in, at a minimum give this market more attention. Looking at the weekly chart over the last few years it appears palladium may be a good candidate for trend followers. For much of 2008 the trend was down and for much of 2009 the trend was up...what will 2010 bring? Like palladium, platinum was on a track higher last year with virtually every 7-12% correction being bought. This market is too thin for our liking but we thought it deserved at least mentioning.

Energies: When most investors think commodities they think Crude oil. 2008 was a tough act to follow as prices of Oil soared past most forecasts but 2009 did not disappoint. What makes oil a great market to trade is there were opportunities for both longs and shorts to profit from last year. With prices bottoming in Q1 your bias would have needed to be long but oil is a market that does not move in a straight line. Oil prices have most likely gotten ahead of themselves now being 160% off their lows, but it is our opinion that in 2010 we will see triple digits once again so brace yourself. Oil is always a demand story but one cannot make light of the situation that the refinery utilization levels are so low. If this does not pick up and real demand comes back into this market BULLS will be in the driver's seat. Though RBOB and heating oil markets have their own dynamic really and one needs to pay attention to Crude as it is the dog and the distillates are the tail. Rarely will you ever see a big disparity in directional moves. There is no denying that once RBOB and heating bottomed in Q1 the trends have been up but what is the most alarming thing to me was the divergence in pace; heating oil is 83% off its lows while RBOB is just over 150% off its lows. The RBOB wildcard that we're still trying to work through here in the US is how big of a part alternative fuels will be in the equation. We have just started what could be a brutally cold winter so a demand spike in home heating oil use could be the wildcard for heating oil.

Currencies: There is so much negative media attention on the dollar and how the US dollar is being called into question as the world's reserve currency which may in fact be an accurate insight but based on its performance in 2009 I think the naysayers may be premature being the dollar only depreciated 5% last year. The longer the Fed keeps interest rates at 0% the more risk we see in the dollar; it is pretty straightforward. Well I guess I'm being too elementary it also boils down to what other Central banks do with their interest rates. Deeper than just interest rates, investors need to pay attention to the overall risk appetite of other investors and the flow of money between different asset classes, i.e. debt, stock, commodities, forex. We continue to think there is just as much if not more problems to come in Europe and in the UK, so although both crosses were higher last year we expect both to be a sell rallies market into 2010. It is no surprise that the top three performing crosses last year were the commodity currencies; the Loonie gained 16%, the Aussie higher by 29% and finally the Kiwi profitable by 26%. If commodities trend higher these three currencies should reap the benefits, on a correction commodity wide they would be the crosses to suffer the most. For the most part throughout 2009 international currencies behaved with an inverse relationship to the dollar. The exception was the Japanese yen which had more of a relationship to equities than the dollar. The rationale we think is the "carry trade" and as investors risk tolerance changed they bought/sold the yen as this currency was used to fund a large number of the recent speculative moves.

Financials Prices going into 2009 were in the process of falling off a cliff but just as the bearish sentiment reached a new paradigm BEARS were stopped in their tracks and either a bear market rally occurred or a new bull market like no other got under way. The move higher in all three US indices; the NASDAQ, Dow and S&P have been nothing short of spectacular. The only problem I see is that unless you bought at that low with new money you may not be much better off then you were 1 ½ years ago. This violent move proves that market timing is not the answer as some jumped out on the way down, others failed to get back in while others did nothing but gripe about the volatility. I am not trying to overanalyze what we just experienced, my lone point is that the S&P for example traded down 58% in 18 months from its highs in 07' to the low in 09' to only do an about face and gain 65% in less than 8 months and I just don't feel those massive swings are an accurate reflection of the overall economy. The market has changed and it has become a stock pickers market, we maintain that buy and hold does not work like it used to and that investors need to be much more nimble. We have been thinking a 10% correction is long over due and though as of now it has yet to materialize we are confident that early in 2010 it will; our only hope is we are positioned with clients to take advantage. 2008 was said to be one of the most disorderly and irrational years in modern history in the Treasury complex but looking back at 2009 was it really much different? As for 30-yr bonds the trading range in 2008 was 29'0 points while the H/L in 2009 was virtually the same just in the opposite direction. As for 10-yr notes the trading range in 2008 was almost 20'0 points while the H/L in 2009 was still 14'0 but like 30-yr bonds in the opposite direction. The overwhelmingly bearish trend that existed throughout 2009 was that money flowed out of Treasuries and into other asset classes, namely commodities and equities. Also there were rumors spreading that foreigners were less interested in buying US debt, but who could blame them at these rates. We were early on the Euro-dollar trade in 2009 and although we were able to navigate shorts a number of times, the main trend was up in Euro-dollars. A bulk of the 2009 trades we put on will not come to fruition and will be losers for our clients, thankfully we're scale trading and only have a small percentage of their capital in this play. Our clients will continue to allocate a portion of their commodity portfolios in this trade essentially speculating that interest rates will be moving higher in the months and quarters to come. Look for more detail in our 2010 Outlook.

Livestock: Watching paint dry would be an accurate description of the action we saw in the cattle market in 2009. Prices in live cattle stayed contained within an 8 cent trading and for the most part did not wonder too far from the 83 cent level. This was of course after a 20% correction off the 08' highs into the beginning of 09'. Looking at the weekly and monthly charts puts things more in perspective and a buy in the mid to low 80's would be the way we continue to play this market. As for feeder cattle the trend was sideways from Q1-Q3, but around September prices started to taper off losing 12% until mid-December when prices rallied 7%. We are not as in tune with feeder cattle and though we sporadically trade them for clients we're more interested in trading live cattle. This has a lot to do with open interest and the cattle traders we speak to, with much more experience then us, who tell us to trade live cattle not feeders. Going into 2009 the hog market had 2 bearish factors to contend with; surging supplies and a sharp drop in export demand and because of these, prices started the year on a sour note losing virtually 30% before they bottomed in mid-August. As things started to improve in the economy and supply & demand constraints started to normalize, prices caught a bid and through out the rest of the year found there way back to almost where they started in 09'. Prices may have a bit more upside but things appear to have gotten ahead of themselves and being that lean hogs never got the typical seasonal correction we get in December this could be a ripe candidate to short. We will explore this in more detail in our 2010 outlook.

Conclusion: It seems almost impossible but with another year behind us I've been trading commodities for almost 1 decade and although this makes me a seasoned veteran by definition, I am still learning almost on a daily basis. I consider myself fortunate because the bull market in commodities started around the same time I got into the marketplace. That is not to say it is easy and that prices are always moving higher but the demand from emerging markets, the industrial revolutions in the BRIC countries coupled with the loose monetary policies of Central banks around the globe, most likely will ensure another 10 years to you and I. We hope this brief summary helps outline the main points of 2009 and would suggest to all inventors that were captivated in this piece to instead of looking in their rear view mirror look out in front of you and read our 2010 outlook.

Risk Disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.

Treasury trade has finally moved from lethargic to exciting. After weeks of consolidation, a break out was well overdue and the move didn't disappoint...except for those on the wrong side of the move.

The initial move upward was triggered by a humble beginning to the equities earnings season and concern over higher Chinese interest rates. Tighter credit in China put pressure on stocks and commodities as well as lured safety bids into bonds and notes.

The higher dollar seems to be a positive for U.S. fixed income products as well. Stability in the domestic currency should help to keep foreign investors holding onto Treasuries. While too much of a good thing could work against Treasuries, the dollar is still relatively cheap and the currency conversion shouldn't deter fresh longs in bonds and notes.

A solid note auction was just want the complex needed to start the short squeeze. $40 billion in 3 year notes went off at 1.49% and a bid to cover of 2.98 while $26 billion of the 1-years drew .335% and a bid to cover of 3.63. Investors seem to be willing to pay up for short maturities; likely out of fear of higher long-term rates and a questionable recovery. Don't forget, for those that can hold to maturity risk in fixed income is mild, for those that might be looking for liquidity (the ability to trade in and out throughout the bond life) are facing considerably higher risks.

We have been looking for this rally for quite some time, and true to form the market finally made its moved once most had given up on the idea. It seems likely that a majority of today's buying was at the hands of buy stop running and panicked shorts. Therefore, a moderate pullback might be seen in tomorrow's session; however we feel as though the long bond will soon see the mid-118's. New support is 116'08.

If you are trading the 10-year note, look for support at 116'10 with a target near 117'25ish.

* Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data. However, market analysis and commentary does. Charts provided by Track 'n Trade, Gecko software.

**Seasonality is already be factored into current prices, any references to such does not indicate future market action.

Treasury Bond and Note Option Trading Recommendations

**There is unlimited risk in naked option selling.

December 28 - Our clients were recommended to sell the March Bond 110 puts for 23 or better.

Treasury Bond and Note Futures Trading Recommendations

**There is unlimited risk in trading futures.

Flat


Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
cgarner@DeCarleyTrading.com
1-866-790-TRADE
Local : 702-947-0701

www.DeCarleyTrading.com
www.CommodityOptionstheBook.com

*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.

There is substantial risk of loss in trading futures and options.

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Today's Gold Session Settled $22.00 Lower... ($1129.40)

Today's Gold trade could not maintain early gains as world economic data pressured the
allure to the "precious metals". China unexpectedly raised Reserve Interest Rates (50 Basis points) starting January 18th. This move by the central bank of China is in
accordance to their commitment to slow down rising inflation as well as tightening their monetary liquidity. Today's action by the China Central Bank created a late session sell-off in the Gold market resulting in a $22.00 Lower session. The trading range for Comex Gold today had a range of $23.60 consisting of a High of $1152.30 and a Low of $1128.70. This is kind of a 'win"-"win" situation for China because their action today sent the price of gold lower and as they are seeking to build their bullion reserves the raising of rates makes Gold more affordable.

Early in the session we received data revealing India's gold volume under ETF's (Exchange traded Funds) rose 55 percent on the year. The seasonal The recent bullion buying surge from India is attributed retail customers and jewelers for festivals like "Makar Sankranti" which is certainly one of the auspicious occasions for Hindus (a Harvest festival) in which the sharing of gifts is tradition... (Gold is the gift of choice) as well as the last days of the 'wedding season". **Makar Sankranti begins January 14...**

My Swing Numbers 1/13 ....February Gold

Resistance # 2............$1171.00
Resistance # 1............$1150.00
Pivot..........................$1137.00
Support # 1.................$1116.00
Support # 2.................$1103.00


Mike Daly / Gold Specialist
PFG BEST
mdaly@pfgbest.com
312-775-3014
877-294-4669
312-563-8029

** There is extreme risk trading futures,options,and forex" **

Do hedge funds have an impact on energy trading?

While the answer might seem intuitive, the debate as to whether they actually do has come to resemble the medieval theological dispute about how many angels can dance on the head of the pin.

Because, like angels, many trades in energy futures are invisible, and it is often not possible to pinpoint where they take place.

And yet, for most of us, including lawmakers on Capitol Hill, it seems obvious that when hedge funds buy and sell billions of dollars worth of oil and gas futures, it must be having an impact on energy prices. While hedge funds and other speculative traders would never dream of taking delivery of a barrel of oil, their trading activity affects the prices for actual consumers of oil and gas and their downstream customers - or so it would seem.

When Gary Gensler, a former Goldman Sachs banker and Treasury Department official, was nominated last year as chairman of the Commodity Futures and Trading Commission - the chief regulator for energy futures trading - he reversed the CFTC party line that speculators don't have an impact on energy trading.

"I believe that excessive speculation in commodity futures can cause sudden or unreasonable fluctuations or unwarranted changes in commodity prices," Gensler said in a written response to lawmakers' questions ahead of his nomination hearing.

Gensler went on to pledge that if confirmed, he would have the CFTC guard against such speculation.

While he stopped short of saying that excessive speculation had taken place in the run-up of energy prices in 2008, he did express the opinion that the rapid growth of commodity index funds and increased hedge fund allocation to commodity assets contributed to the "bubble in commodities prices that peaked in mid-2008."

He noted that non-commercial investors sometimes account for up to 90% of open interest in a contract. (Open interest is a calculation of the number of active trades for a particular market, and is used as an indicator whether trading is becoming more or less active.)

Gensler's answer, enshrined in draft legislation currently before Congress, is to make trades more visible by requiring all over-the-counter derivatives to trade through an approved clearing house. While the thrust of new legislation is to get a better handle on financial derivatives such as credit default swaps, it will give regulators a better picture of all derivatives trading, including energy contracts.

At the same time, the CFTC and the Securities and Exchange Commission both are beefing up their ability to monitor hedge fund activity. The SEC for the first time will require hedge funds to register as investment advisors, and Gensler has pledged closer oversight of the funds that it supervises as commodity pool operators.

The industry, predictably, is pushing back. In congressional testimony on the new legislation, the Chicago Mercantile Exchange, the largest futures exchange in the world, and other exchange operators presented studies based on CFTC data to show that large positions held by index funds and other managed money were not "routinely detrimental" to the commodity markets in the period January 2005 to June 2008.

"All of the trader groups displayed instances of non-optimal behavior (including small traders), but none were consistently harmful to the studied markets," they said.

A task force of the International Organization of Securities Regulators (IOSCO) released a report last March that came to a similar conclusion.

"While reports reviewed by the task force concluded that fundamentals rather than speculative activity was the plausible explanation for price changes, the task force has made a number of recommendations to improve the transparency and supervision of these markets," IOSCO said.

These included suggestions regarding information about the underlying commodities, access to and sharing of information about trading positions, beefing up enforcement powers, and improving global coordination.

The spectacular collapse of the Amaranth Advisors hedge fund in 2006 when it lost $6 billion on natural gas futures did pull back the veil on hedge fund activity in energy markets. Amaranth built up its huge position in natural gas futures through OTC contracts that exactly mirrored the contracts on the New York Mercantile Exchange but remained hidden from regulators, who were unable to enforce position limits designed to rein in speculative trading.

In hearings about Amaranth before various House and Senate committees as well as at the CFTC itself, it became clear, at least to many lawmakers, that contracts on unregulated trading venues can influence prices.

The case was so straightforward that it prompted the Federal Energy Regulatory Commission to flex its new post-Enron mandate to stop manipulation of energy prices by pursuing disciplinary action against Amaranth.

This led to a turf war with the CFTC, which claimed exclusive jurisdiction over futures trading and argued that FERC's mandate extended only to spot trading. FERC countered that when activity in the futures market affected spot prices, it was authorized to act.

Those proceedings ended in a joint settlement last August, before either CFTC or FERC held their administrative hearings and before an appellate court could decide the jurisdictional issue.

But the Amaranth case remains as a reminder of what a hedge fund can do in energy markets if these trades are not more transparent. Legislation bringing more visibility to the market and strengthening the hand of regulators will ensure that hedge fund activity in the energy markets will be more closely monitored and limited.

This article was written by Darrell Delamaide for OilPrice.com who focus on Fossil Fuels, Alternative Energy, Metals, Oil Prices and Geopolitics. To find out more visit their website at: http://www.oilprice.com

What is the market going to do for the coming year? The belief that all is well and that we are out of the woods regarding the recession, could be true and then again they might just be a pipe dream. All we see is a jobless recovery bordered by restricted lending by banks and increased saving from the consumers--does this sound familiar? Well it should as this is the third jobless recovery our economy has had. People continue to live in fear of not being able to make their bills and, because of that fear won't spend money easily--this will hurt the very fragile recovery. A great deal of the recovery depends on consumer spending. Here in the North East, we are just getting our winter utility bills which reflect the colder weather. Certainly, some of these bills will restrain the ability for the consumer to spend. We have seen a new trend, people flocking to malls for the heat so that they don't need to heat their homes to stay warm. Now that is scary.

This week we begin with earnings season with Alco beginning the parade. We expect earnings to be okay, but what won't be okay is cash flow from current business. Most of the earnings are coming from cut backs in costs rather than increased production. While the headline number might be good, dig into the number and look for cash from operations to discover if this recovery is flowing to the bottom line.

Monday: St Louis fed President speaks.

Tuesday: November international trade is released at 8:30, Crop report is released and Tiffany released its holiday sales.

Wednesday: The beige-book is released at 2:00, and the European Central Bank issues its interest rate decision.

Thursday: December import prices are released at 8:30, December retail sales are released at 8:30, November business inventories are released at 10:00 and INTEL reports its earnings.

Friday: December CPI is released at 8:30, December industrial production and capacity utilization is released at 9:15, January Michigan Survey is released at 9:45-10:00, and Richmond Fed president Lacker speaks.

The US Dollar index declined under the weight of the dreary "jobs" report released in the Friday session. The chart shows that Friday was an outside day. The candle is a bearish looking candle. So long as the US Dollar index stays above 77.39 we will remain constructive however; should the US Dollar close below 77.39, the door will be open to 76.658. Naturally, as the US Dollar retreats we find dollar based commodities increasing. Crude oil has been increasing even with the strong US Dollar and this current weakness will be a positive boost to crude oil. All the indicators that we follow continue to issue a sell-signal for the US Dollar index. The indicators show that there is plenty of room to the downside. The weekly chart looks as though we have made a top and will go lower. We have an outside week on the chart. All the indicators that we follow are issuing a sell-signal on the weekly chart. The downtrend line is at 78.467 and to reverse the current trend of the market, we would need to close above that line. We are above the Ichimoku Clouds on the daily time-frame but are below the clouds for both the weekly and the monthly time-frame. The 5-day moving average is at 77976. The top of the Bollinger band is at 79.115 and the lower edge is seen at 76.405.

The S&P 500 has been up for the entire first week of trading in the New Year. That said, we have signs of exhaustion and we seem to be climbing the upper edge of the Bollinger band. The upper edge of the Bollinger band is 1141.53 and the lower edge is seen at 1093.85. The 5-day moving average is at 1127.83. We are overbought as measured by all the indicators that we follow, all of which continue to issue a buy-signal. Naturally, we are above the Ichimoku Clouds on the daily and weekly charts but are below the clouds for the monthly time-frame. When we apply Fibonacci retracements on the monthly chart, we are slightly above the 50% level. The indicators on the weekly and the monthly time-frames are extremely overbought and continue to point higher. When we look at the Market Profile chart we are in the single print area which tells us that there is no overhead supply to work through and that we are in an area of high instability. There are two things that can happen now, either we melt up or we go back to 1127.04 or so where we will find some stability. These certainly are interesting times.

The NASDAQ 100 rallied in the Friday session and closed at a higher level than the open leaving a green candle on the chart. The NASDAQ 100 is grossly overbought as measured by the indicators that we follow. All the indicators continue to issue a buy-signal. The 5-day moving average is at 1877.83. The top of the Bollinger band is at 1917.39 and the lower edge is seen at 1769.77. Naturally, we are above the Ichimoku Clouds for the daily and the weekly time-frames but we are in the clouds for the monthly time-frame. We remain overbought on all time-frames. The chart tells us that we can continue higher. The market profile chart shows us that we are in an area of instability.

The Russell 2000 is grossly overbought, but without any signs of an impending sell-off. The 5-day moving average is at 634.25. The top of the Bollinger band is at 650.12 and the lower edge is seen at 594.61. We are above the Ichimoku clouds for the daily and weekly time-frames. We are overbought on all time-frames. The uptrend line for the daily chart is at 632.20. We wouldn't be surprised to see a further push to the upside. It seems as though the bulls have more energy left. We do see some resistance at 644 or so.

Crude Oil left a doji candle on the chart for the Friday session. Remember a doji indicates a transition and, perhaps a change of direction. Crude oil is overbought as measured by all the indicators that we follow herein. The 5-day moving average is 80.90. The top of the Bollinger band is at 85.67 and the lower edge is seen at 67.22. Crude oil has been rallying in spite of a strong US Dollar. As we said last week, it looks as though there is real demand for the product. We are above the Ichimoku Clouds for the daily, monthly and quarterly time-frames but we are in the clouds for the weekly time-frame. We are overbought on all time-frames. It would not be surprising to see some consolidation and perhaps a retreat before the next run to the upside.

It would seem that all the commodities that we follow are overbought, gold is not. Gold closed higher in the Friday session but remains inside the Ichimoku Cloud for the daily time-frame. We are above the Ichimoku Clouds for the weekly and the monthly time-frames. Gold differs from the other commodities in that it is not overbought on all time-frames but is overbought on the daily time-frame. Actually, we are getting a buy-signal on the weekly chart. The Bollinger bands indicate that we will be moving into a period of higher volatility. We remain cautiously bullish on gold.

Regular readers are probably tired of hearing this but as for oil we are anticipating a $4/5 correction form these levels. We decided to push some money into the middle with some of our aggressive clients and advised them to buy April $82.50/$75 put spreads. A 38.2% Fibonacci retracement takes prices back to $78.50 on the February contract. Natural gas posted another lower day today; we expect a trade down to $5.25.

Sugar lost just under 2% today, our prediction of a back off looks to be right but the spread worked against clients today. Remember we're expecting March to lose more than July and that was not the case today. OJ was up limit again today on more talk of freezing temperatures in Florida, we had mentioned potentially going short via options we've opted to get out of its way thinking out guessing Mother Nature is too grave of a risk. Silver held the $18 level and posted it's sixth consecutive showing. We suggested longs and like the idea of May $2/3 call spreads or scale trading futures with a long bias. As long as gold holds the 20 day moving, which comes in at $1113 we like having clients long. Some clients bought June $1170/ $1300 call spreads today for just under $3200/per.

Corn closed up 5′4 cents near the recent highs. If given the chance we suggest lightening up on March longs ahead of next Tuesday's USDA report. Clients were advised to book a profit on their March soybeans shorts from Wednesday. Following the NFP clients legged out of their NOB spreads booking a profit on their short March 10-yr notes, they currently hold longs in March 30-yr bonds and are under water. From here we expect to see 30-yr bonds advance 2 1/2 - 3 basis points. Sell into strength in the Euro-dollars. We are trading both the September and December 2010 contracts for clients. A reversal of fortune from yesterday with the dollar losing ground and all crosses gaining. Clients remain long the yen expecting a move to 111/112. We most likely will not take the trade but we do expect to see moves north in the Swiss Franc, Euro & British Pound. Nothing new in live cattle...as long as the 20 day moving average holds we like being long; in February at 88.80. If given the chance exit longs on rallies and look to roll out to further months.

Risk Disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.

As we approach the end of the first trading week of the year we have seen the Gold and Silver virtually shadow the U.S Dollar. Since for the most part the U.S Dollar and Metals markets have an inverse relationship the greenbacks inability to maintain any momentum has helped to fuel this recent Gold and Silver rally. A weaker U.S currency makes the Dollar priced Gold more appealing for investors.

India's Gold buying continued for the fourth Session as the Rupee rose to its highest
level in fifteen months, making the U.S Dollar priced Gold cheaper. The strength of the Rupee is a direct result of the global U.S Dollars weakness. It has been reported that India imported 300-350 metric tons in 2009. So far this year the demand from India, Thailand, and Indonesia have been fueling the Gold demand.

China also has been issued some very favorable retail Gold predictions. However, with the upcoming Chinese New Year or "Spring Festival "starting February 14th and lasting 15 days expect a buying spree from the citizens of China as it is the most important of the traditional Chinese holidays. During this "Festival" people are very generous and buy gifts. Gold and Silver have become the gifts of choice. I expect the buying demand to increase as we get closer to the Chinese New year.

Silver has enjoyed riding the bullish Gold markets coat tails and is once again trading
over $18.00 per ounce. The duo status of Silver as being a "precious metal" and an" industrial metal" will probably help it out perform Gold again

This week also revealed the "NO" bailout policy from the European Union in response to
the lowering of Greece's credit rating due to Dubai's Inability to pay their Creditors.(Greece for one). This has been negative for Gold and helped strengthen the U.S Dollar versus the Euro.

The Geo-political tension in Yemen has sent foreign investors into Gold as a flight to
"safe haven" ...in case of terrorist escalation.Warring environment is bullish Gold.
U.S. and European Embassies closed due terrorist threats.

This week the U.S Labor Department reported that the number of Americans filing initial claims unemployment benefits rose slightly last week. The number rose to 434,000.

Also pending home sales dropped 16% in November despite the extension of the first time buyers tax credit.

The most important number of the week (Unemployment) will be released tomorrow (Friday 1/8 @ 7:30 am. CST.). As we Gold bugs know the last unemployment report 12/4
was better than expected and started the avalanche sell-off ($140.00 +) in the Gold market. Which might justify a lower closing today due to some profit taking.

REPORTS 1/8
UNEMPLOYMENT.................7:30 am CST.
Wholesale trade.....................7:30 am CST.
Consumer installment credit......2:00 pm CST.

Mike Daly / Gold Specialist
PFG BEST
mdaly@pfgbest.com
312-775-3014
877-294-4669
312-563-8029

*There is Extreme risk trading futures,options,and forex*

Definition/theory:
Swing trading is typically defined as a trading practice whereby the underlying instrument is bought or sold at or near the end of an up or down price swing caused by daily or weekly price volatility. A swing trade position is typically open longer than a day, but shorter than trend-following trades or buy-and-hold investment strategies. Although a number of commodity trades that I've been involved in have been quick, others have lasted several months. The average duration of our commodity swing trades in 2009 has been 3-6 weeks.

Explanation/how to (stochastics, channels):
Swing traders attempt to forecast changes in an instrument's price caused by oscillations as it "swings" around the dominant trend line. The price is alternately bid up by optimism and then bid down by pessimism over a period of a few days, weeks, or months. Profits can be sought by engaging in either long or short trading at each reversal.

Identifying whether a market is currently trending higher or lower, trading sideways and when this will change is a challenge for many swing trading and long term trend following trading strategies. A common misconception is that swing traders need perfect timing, to buy at the bottom and sell at the top of markets is impractical. Small consistent earnings that involve strict money management rules can potentially compound returns appreciably. It is crucial to understand that there are no fail-safe mathematical models that will always work so only use such parameters as research tools, also including both fundamental and technical analyses not as definitive decision engines but rather guidelines.

Risk of loss in swing trading typically increases in a trading range or sideways market as opposed to in a bull market or bear market. A market that is clearly moving in a specific direction, albeit up or down is more appropriate for swing trades. A sideways or non trending market increases the potential for whipsaws or false breakouts. In trending markets (either a bear market or a bull market), momentum may carry the traded instrument's price for a much longer time in one direction only, making swing trading strategies that do not incorporate this trending less profitable than trend following strategies.

SUMMARY OF UPCOMING DATA 01/07/10
8:30 AM US WKY JOBLESS CLAIMS (450 K)
10:30 AM EIA NAT GAS INVENTORY
11:00 AM US 3, 10, 10 YR TIPS, 30 YEAR DEBT AUCTION ANNOUNCEMENTS

DATA RESULTS 01/06/10
ADP EMPLOYMENT REPORT (EST -84 K)
ISM NON MANUFACTURING INDEX (50.1/50.4)
EIA INVENTORY REPORT (CL =1.3/-1.5 M, RBOB 3.7M/DISTIL -300K/1.9M)
FOMC MEETING MINUTES: POLICY MAKERS CONSIDER FURTHER ASSET PURCHASES

US DEBT REVIEW AND OUTLOOK

US 30 YEAR FUTURES fell for the first time in three sessions, after the ADP report showed the US economy lost the least amount of jobs since 2008. However the losses were still greater than most analysts had forecast. In addition, the long end of the yield curve contended with renewed supply concerns ahead of the Treasury's announcement of US 3,10, 10 year TIPS (Treasury Inflation Protection Securities).

US Treasuries were also in competition with the largest one day offering of corporate debt in nearly a year on Tuesday. The higher yielding, more attractive balance sheets of many corporate issuers came into the markets strong as many issuers and traders expect the general interest rate environment to rise, increasing the costs of borrowing. 2009 offered a near record return for corporate debt, as buyers sold Treasuries and took advantage of record yields on quality paper prior to the record levels of stimulus and credit support.

Bond trading giant PIMCO also announced that they would be scaling back on their US Treasury holdings in an effort to remain flexible and sector pick in a "developing economic environment."

Markets are likely to remain choppy ahead of Friday's employment data release.

Technically, 30 year Treasury futures continue to expand range levels Daily RSI readings should allow for continued upside for a test of 116-17, with 116-23 setting up as a strong resistance point. This level could shift down due to today's break of downside support of 115-09. In fact, look for some resistance at 115-28. Next downside target 114-20, with 114-07 setting up as strong support

US EQUITY REVIEW AND OUTLOOK

US EQUITIES continued to trade without any real direction, as most traders continue to remain sidelined with their capital ahead of the December US employment data being released on Friday. Data releases continue to offer a mixed picture of recovery, particularly as to the question of sustainability and future revenue growth if and when the government begins to implement an exit strategy. The day may come later than expected based on commentary from the FOMC meeting minutes which were released today. The committee discussed the possibility of renewing its asset purchasing strategies.

Energy and material stocks continued to offer some positive bias to equities after precious metals rallied and crude rebounded from a bearish inventory report to close at their highest levels since 2008.

Technically, little has changed for March S&P futures. The contract continues to have the potential to set up for a test of 1142.00. This should hold as a initial resistance point, with 1150.00 as a breakout to the upside. Support for the contract sets up at 1117.00, which is a significant support target and should be tested within the next two weeks.

Prepared by Rich Roscelli & Paul Brittain.

Please voice your market, options, thoughts, and questions to RICH@BINVSTGRP.COM

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Commodity Trading School, its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

February gold futures prices have rebounded from the December low as the new year gets under way. Recent price action on the daily bar chart has negated a steep downtrend line, while a fledgling uptrend line is now in place.

The gold market bulls have gained fresh upside technical momentum recently, as the U.S. dollar is again under selling pressure. If the greenback remains under selling pressure in the coming weeks, it's likely that gold futures prices will continue to work higher, including challenging the all-time high of $1,227.50, scored in early December. However, if the U.S. dollar index shows renewed price strength then it's very likely gold prices will again weaken. Trading action in the gold market the next week or so will be extra important and could set the tone for price movement in gold for the next several weeks. Stay tuned! Jim Wyckoff

If the first day of trading in the commodity market is any tell of what is to come in 2010 than commodity bulls will remain in the drivers seat. With out reading too much into today's movement the dollar got clipped and funds were buying. Crude oil rallied an additional $2 today which has prices approaching their October highs. The easy money has been made on longs and we would not rule out a set back on profit taking. We will be looking to approach longs for clients on a $3-5 set back. We are expecting a correction in natural gas and would be willing to explore longs closer to $5.25. We are trying to work out of May longs in sugar for clients and then will look to re-establish longs on a 2-3 cent pull back.

The almost 20% appreciation in the last 3 weeks has prices a bit ahead of themselves in my opinion in the short run. We missed a good entry for coffee longs last week as prices were higher by 4.25% today. We continue to price out bullish plays in May on futures and options...stay tuned.

The stock market raced to new highs today and though we do not suggest jumping in front of this freight train we're looking to gain short exposure, most likely after Friday's NFP #. As long as February gold does not break $1080 and March silver stays above $16.80 on a closing basis we like having clients long. For fresh entries put stops below last weeks lows in futures, for options we're helping clients with strategies with call spreads in both metals out until at least May. As we hinted in this mornings commentary the recent appreciation in oats may be signaling an impending bullish moves in agriculture; today did not disappoint.

Our pick of the litter remains longs in corn. The Euro-dollar technically looks set for a rally...we would suggest fading it. Though we remain bullish live cattle I'm a bit disappointed with today's activity with February losing almost 1%. Ideally the 20 day moving average at 85.00 should support. Longer term we still expect 89/90 cents.

Risk Disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.