An overdue recovery in the Euro and U.S. equity markets lured money back into risky assets and away from the safety of Treasuries. One day does not make a trend, but this seems to be the beginning of some attempt at "normalcy".

We have been getting solid economic news recently despite a few minor disappointments in this morning's data. The latest revision to the first quarter GDP was reported at 3%; a bit less than the expected 3.2%. Similarly, weekly jobless claims remain stubbornly high. According to the Labor Department, last week's claims for unemployment benefit was 460,000.

The Treasury markets have spent their seasonally bearish months rallying, and this makes speculation going forward very difficult. In a typical year, bonds and notes should have traded weaker for much of April and May and would be "looking for a bottom" in early June. However, with bond and note prices so elevated it is difficult to imagine that the seasonal lows will be put in sometime in the next week.

Completely ignoring seasonals, it seems as though the financial markets might have turned the corner for now. We feel like the June Euro futures has the potential to see a very large short covering rally (maybe as far as the high 120's). Similarly, the S&P shouldn't run into strong resistance until we see the high 1120's or mid 1130's. Assuming that we are correct, that should put continued pressure on Treasuries in the near-term. We see the first area of support in the September 30 year bond futures just under 121 but if we get some follow through, as low as 117 is possible by late next week.

If you are a bear that has been struggling to scratch on a short trade, it might be a good idea to unload some of your risk. Counter-trend Friday and a three day weekend poses a risk to the market's bearish tone.

Carley Garner
Senior Analyst / Commodity Broker

DeCarley Trading

cgarner@DeCarleyTrading.com

1-866-790-TRADE
Local : 702-947-0701

http://www.DeCarleyTrading.com
http://www.ATradersFirstBookonCommodities.com

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.

Oil gained virtually 4% today and is $4 off its lows yesterday. As soon as we get thru the 9 day MA we expect to see more buying; that level is just above today's high. From here we see a grind higher to $76/barrel. That being said we expect heating oil and RBOB to trade higher. Our first objectives would be $2.06 in heating oil and $2.10 in RBOB. Natural gas traded but failed to close above the 9 day MA. Clients trailed stops and were stopped out at a profit today. We will continue to buy near $4 for clients and trade the range.

We would hope to see a larger rally in equities to institute shorts for clients in the ES once again. We expect to see buyers emerge between 1050-1060; if that level holds we would expect bulls to be able to push prices to 1125-1150 and we will re-establish shorts for clients. Inside day in October sugar but as long as the 15 cent level holds we like having clients long via futures or options. We've yet to make a move but we've started to price out bullish strategies in September coffee...stay tuned. 30-yr bonds traded below 124′00 for the first time this week but failed to close below that level. Clients are positioned short thinking a trade to 121-122′00 is in the immediate future.

We continue to advise clients to buy puts and to short futures in June and September 2011 Euro-dollars. August lean hogs gained 1% today lifting prices to the down sloping trend line. Clients may need to adjust their profit order to a lower objective...stay tuned. Gold is back above $1200/ounce gaining for the third consecutive session. Clients have yet to gain exposure but we are likely to see a new high in the coming weeks. We will likely have some bullish plays in the coming sessions. The only reason we've failed to get in with clients is most of our clients are long silver and we feel both metals should yield the same result in the short run. Today silver gained 2.10% vs. gold at 1.10%. We're expecting silver to trade above $19 in the coming weeks and will remain long with clients as long as $17.40 supports.

Aggressive traders could buy November soybeans and December soy meal with stops below the recent lows. Our favored Ag play is long exposure in corn as most of you know. Risk to reward two viable plays we see in currencies is long the Loonie and Pound. Our targets are .9650 and 1.4750 respectively.

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

Gold Settles $15.50 Higher .... ($1215.30) August Gold

The European Union's debt crisis continues to fuel investor demand for gold on a global basis. Investors world-wide appear to using Euro's to purchase gold as a hedge or "safer haven" to guard against further Euro Dollar weakness. There is sentiment throughout the investment community that the worst may not be over in the Euro region and savvier investors are taking stock in gold.

The European's are not alone it has been reported through the WGC (World Gold Council) that "India's total gold demand surged to 193.5 tons In the first quarter. (ending march 31st) 147.5 tons was sold as jewelry! Also china's demand was up 11%. There is always insatiable demand out of the Asian sector .... As you can see there is certainly a huge demand GLOBALLY.......

The U.S mint has reported " sales of coins has risen to its highest level since December 2008. Bernanke repeated overnight "that central banks must be insulated from politics if they are to be effective"... (while in Tokyo)...He also added "U.S inflation expectations are very stable. The world is also eyeing some growing tension between North Korea and South Korea....as there appears to be mounting evidence that North Korea did in fact torpedo a South Korean Navy ship earlier this year....Global tension forces investors to safer havens.....(Gold , Silver, Diamonds....)

The April report for New Home Sales was much better than expected up 14.8%.....504,000

REPORTS 5/27

EXPORT SALES.....................7:30 am (CST)

GDP.......................................7:30 am (CST)

JOBLESS CLAIMS.................7:30 am (CST)

SWING NUMBERS 5/27.....AUGUST GOLD

RESISTANCE # 2.............$1228.00

RESISTANCE # 1.............$1221.00

PIVOT..............................$1212.00

SUPPORT # 1.................$1206.00

SUPPORT # 2.................$1196.00

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*

The markets have relaxed but as investors you must not. Their will be wild gyrations in the weeks to come so start thinking long and hard how you want to be positioned. At the moment $69 appears to be the line in the sand on front month Crude oil; July as of this post is at $70.20. Aggressive traders could buy futures with stops below the recent lows. We prefer to be buyers of August and September $5 bull call spreads for our clients. On the August contract we expect to see a trade over $78/barrel in the coming weeks. We have started to advise clients looking to capitalize on movements in the distillates to get long; if our analysis is correct in Crude we should see a bounce 20-25 cents in heating oil and 15-20 cents in RBOB. As for natural gas it is not high on our list but traders wishing for exposure should continue to trade the 40-50 cent range.

Continue to sell rallies in the indices; our downside targets are 1050 and ultimately 1000 in the S&P, 9600 in the Dow and 1710 in the NASDAQ. This could be a bumpy ride and we may see a rally back to the 100 day MA before the next leg lower. This comes in at 1135 in the S&P, 10545 in the Dow and 1895 in the NASDAQ. Cocoa closed above the 9 day MA today for the first time in two weeks; expect bullish trade recommendations in the days to come. Another 2-4% correction in sugar and we will start getting clients long October 10′ and March 11′ contracts. We likely will be sellers of cotton this week for clients so stay tuned. OJ closed lower today for the first time in eight sessions; could this be the beginning of the correction we've been calling for?

We're pricing out bearish play in Treasuries with futures and options but as of yet we've yet to price out a viable play. Based on the last two sessions we want to be selling rallies for clients but have yet to decide on a futures or options strategy...stay tuned. The short end of the curve remains a sell as we're advising clients to buy long dated puts or to sell futures. It appears the market is starting to price in higher interest rates. We will be looking to unwind the remainder of client's short August lean hogs on a drop of 1.50-2.50%.

Gold traded higher for the first time in eight sessions gaining virtually $20/ounce on the session. We see light support at $1170 in June but have yet to establish any positions for clients until we get further proof that the recent 6.5% correction has run its course. July silver was higher by 1.90% on the day but has yet to take out previous support which is now acting as resistance at $18/ounce. Needles to say we've advised clients to start working lightly long again via July futures or September $1.50-$2.00 call spreads. In Agriculture we suggest longs in September and December corn, November soybeans and December soy meal; for specifics contact us. The US dollar and Euro will likely set the tone this week as other crosses look for guidance. At the moment clients only exposure is longs in the Pound via July options.

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

Earlier this week we urged all of our clients to get flat Treasuries because things didn't "feel" right and they still don't. Treasuries have managed to maintain an upward bias in the face of higher equities (the few bounces that we have gotten), a recovery in the Euro, this signals that there are some behind the scenes forces that are carrying a bit more weight such as emotion.

When markets become emotional, they are nearly impossible to predict. Let's face it, humans are unpredictable and market prices are the result of the conglomerate of human reaction to news and events. That said, under most circumstances I believe that the Treasury markets tend to maintain their composure much better than equities do. As a result, bonds and notes are often late to react to the equity and currency markets; accordingly, we don't feel as though being short Treasuries has the risk reward prospects that we would like to see. Perhaps sitting on the sidelines is the best position for now.

The economic calendar for next week will be thick and might be what the markets need to get their heads off of Europe. We can't deny that a credit crisis overseas wouldn't be devastating for domestic markets but we also can't assume that European leaders won't make the reform necessary to mitigate the pain. If you have to play Treasuries, you should likely have a bearish bias but you want to keep risks low and don't overstay your welcome. Friday's highs should stay intact for now; if so, support in the 30-year comes in near 123'27 and then again near 123'04. Good luck!

* 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.

Flat

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

http://www.DeCarleyTrading.com
http://www.ATradersFirstBookonCommodities.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.

Oil Market Summary for 05/17/2010 to 05/21/2010

Crude oil prices ended just above $70 a barrel on Friday after dipping below that threshold earlier in the week. The benchmark June contract for West Texas Intermediate settled at $68.01 before it expired on Thursday, after falling below $65 a barrel in intraday trading.

The decline from the $87+ a barrel reached earlier in the month is more than 20%, fitting some analysts' definition of a bear market. Continued weakness below $70 a barrel could send prices tumbling further, into the $50 range, some analysts said.

Passage of financial regulatory reform legislation in the Senate Thursday evening ended most of the uncertainty about how severe measures might be, giving a lift to financial stocks on Friday, and other markets along with them.

The benchmark July contract settled at $70.04 a barrel on Friday, down from its $70.80 close on Thursday, compared with the benchmark price of $71.61 a barrel a week ago.

A continued slide of the euro against the dollar and persistent worries about the fiscal situation of Greece and other European countries continued to roil markets during the week.

Concern about the impact of the euro crisis on global economic growth exacerbated the situation for stocks, leading to a loss of 3% in U.S. stocks on Thursday alone. An unexpected surge in the weekly U.S. jobless claims figures - claims were up 25,000 to 471,000 when experts had forecast a decline - further spooked the equities markets.

In a global flight to safety, investors sought refuge in U.S. debt securities, pushing down Treasury yields in spite of debate about the U.S. deficit. In late Friday trading, 10-year notes were yielding about 3.2% and 30-year bonds 4.1% -- both at their lowest levels since last October. The 30-year bond yield actually dipped below 4% at one point.

Oil inventories continued to rise, according to the weekly report from the U.S. Energy Information Administration, though less than forecast.

But the inexorable rise of stocks at the Cushing, Oklahoma depot where Nymex oil is delivered continued to weigh on the benchmark contract. Stocks at Cushing rose another 917,000 barrels in the week, to a new record of 38 million barrels - which may be nearing full capacity according to some estimates.

Source: http://oilprice.com/Energy/Oil-Prices/Crude-Oil-Prices-Remain-Under-Pressure-After-Dipping-Below-$70-a-Barrel-in-Week.html

By Darrell Delamaide for Oilprice.com who offer detailed analysis on Crude oil, Natural Gas, Geopolitics, Gold and most other Commodities. They also provide free political and economic intelligence to help investors gain a greater understanding of world events and the impact they have on certain regions and sectors. Visit: www.oilprice.com

Gold Settled $21.50 Lower... ($1193.10)

The gold market continued to reflect the uncertainty of investors regarding the latest news coming from the European Union. Yesterday we reported BaFin (Germany's financial services regulator) had announced it will introduce a temporary plan to ban short selling. The ban will apply to naked short selling and naked credit default swaps of Euro region government bonds starting at midnight yesterday and in effect until March 31st ,2011. This news has rattled the equity markets globally. It has not only taken the market makers liquidity out of the market it almost suggests that policy makers are in a "panic mode" in attempts to get the Euro region debt crisis under control. The region continues to experience heavy debt and low economic growth...a recipe for disaster.

Gold traders have continued profit taking as the technically over-bought market had lost momentum above the $1240.00 level... Today as usual there were rumors out of the European Union and today's suggested that Greece was considering leaving the European Union. Off of this rumor the Euro rallied to a session high against the U.S Dollar and Swiss franc.... This RUMOR helped investors in their decision making process to take profits in the precious metals.

*GLOBEX GOLD COVERED A RANGE OF $41.60 TODAY*

HIGH =$1228.20 --------LOW = $1186.60 -------

The latest sell-off has helped fill in some key "technical gaps" ($1200.00- $1190.00) and may offer the eternal "Bulls" an opportunity to re-enter at lower prices.

The U.S CPI (consumer price index) declined in April for the first time in 13 months..... The number of American homeowners in foreclosure has reached a record 4.6%. In addition 10% of homeowners have missed a mortgage payment in the first quarter.

REPORTS: 5/20.....

EXPORT SALES.............................7:30 am (CST)

INITIAL JOBLESS CLAIMS...........7:30 am (CST)

My Swing Numbers 5/20 June Gold

RESISTANCE # 2.................$1243.00

RESISTANCE # 1.................$1218.00

PIVOT..................................$1202.00

SUPPORT # 1......................$1176.00

SUPPORT # 2......................$1161.00

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*

The plunge in oil prices in the wake of the euro crisis has OPEC worried.

Qatar oil minister Abdullah bin Hamad Al Attiyah emerged as an unofficial spokesman for the oil cartel over the weekend in a series of news agency reports from the Gulf that signaled the group's concern.

On Monday, as oil futures briefly dipped below $70 a barrel after settling Friday at $71.71, Al Attiyah told reporters that a price below $70 a barrel was too low for companies to maintain investment and expand capacity. Such investment is crucial to avoid a supply shortage in the future, Al Attiyah said.

He reiterated that following the lead of Saudi King Abdullah's pronouncement about a "fair" oil price in December, OPEC officials want to see a price between $70 and $80 a barrel.

At another industry event on Saturday, Al Attiyah told news agencies that the drop in oil prices was "psychological" and not based on fundamentals. He said the crisis concerning Greece and the euro was causing the drop and speculation about "contagion" would continue to depress oil prices.

"The whole world then started to ask the question about if it will move to other countries," the Qatar minister said, according to agency reports. "We're watching, with nervousness."

Qatar, one of the world's leading producers of natural gas, is a relatively small oil producer, but is closely allied with the main Gulf producers - Saudi Arabia, Kuwait and United Arab Emirates.

Concern about the future of the joint European currency continued to batter financial and commodity markets on Monday, as prices fell and the euro declined further against the dollar and other currencies.

At a meeting of the Arab OPEC members earlier this month, Kuwaiti oil minister Ahmad Abdullah Al-Sabah said a price below $65 a barrel would "ring a bell" for the oil cartel and could prompt them to hold an emergency meeting ahead of the next scheduled meeting Oct. 14.

OPEC could react to a low price by cutting production, as it did in 2008 when the financial crisis lowered demand and sent oil prices plunging.

Source: http://oilprice.com/Energy/Oil-Prices/Psychological-Plunge-in-Oil-Prices-Makes-OPEC-Nervous-Official-Says.html

By. Darrell Delamaide for Oilprice.com who offer detailed analysis on Crude oil, Natural Gas, Geopolitics, Gold and most other Commodities. They also provide free political and economic intelligence to help investors gain a greater understanding of world events and the impact they have on certain regions and sectors. Visit: www.oilprice.com

What I've learned over the years is if I'm trading what most people are trading I'm probably losing money for clients so it is OK to be contrarian with some of your investment themes. On the lows today July Crude was just over $1 from its February lows closing below $74 today while June Crude (the front month) is below $70 for the first time in 2010. We feel you should start scaling into longs as we're close to an inflection point. Clients are buying August $5 call spreads. July natural gas was higher by almost 2% today and appears to be on the verge of breaking out to the upside. This should be on your radar but be careful as this market has fooled us before. On a settlement above $4.50 in July we should see shorts cover and a trade closer to $5.

If indices close below the 100 day MA there should be more selling in the coming sessions. We have downside objectives at 1075 in the S&P, 10170 in the Dow and 1800 in the NASDAQ. We've yet to make a move in cocoa but if prices can consolidate around 2800 we may start to probe longs for clients. Sugar needs to hold these levels or we will be advising clients to exit their recently bought longs in October. Some of our clients liquidated more of their OJ longs as we think prices are due for an interim correction. Coffee was lower by 1.3% but we would like to see a bit more before pricing out longs for clients. Aggressive traders can continue to sell Treasuries but understand this could be a bumpy ride. Additionally on the CPI and PPI in the coming sessions expect increased volatility.

Lean hogs broke the trend line that has held since February today and partially filled the first of 2 gaps we've been calling for. We still think there is more downside and have advised clients to trail stops on short futures and to put in gtc profit orders on their options. Across the board metals traded lower with gold down 0.30%, silver a loser by 1.6% and copper hit the hardest down by 5.78%. We anticipate more downside in metals and think there could be another 3-5% in gold and silver almost immediately. Those wishing to play the trend we would advise looking at long entries from lower levels as opposed to trying to play the short side. We should have some suggestions on both on a trade closer to $1182 in June gold and below $18 in July silver.

Clients were advised to offset their short July corn hedges today at a slight profit and remain long December. For new entries we're suggesting buying September calls and December futures in corn. Look for more downside in soybeans and soy meal before establishing longs...stay tuned. December KCBOT wheat should continue to gain a premium to CBOT wheat as long as wheat prices are moving down. Clients were buyers of the Yen today expecting a trade above 1.1200 in the coming weeks. For more specifics contact us. On signs of a reversal in the US dollar we may look to buy some Euro-currency calls so 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.

Here is a question for you to ponder, if the banks are public enemy number 1, why is it that we the people have been funding their fun? Are we the people making money on the spread or a piece of the spread on lending that the banks are making and if not, why not? Remember, we the people helped them out of their financial crisis so; we the people should enjoy some of the prosperity that these banks are enjoying. Here is a quote from THINK GREECE, IT'S FRIDAY by Michael Santoli, Barron's Magazine May 17, 2010. "Goldman Sachs (GS), JP MORGAN Chase (JPM) and Bank of America (BAC) - disclosed in filings that their trading operations were profitable each and every day in the first quarter." After all, how many of us could say that we made money every day on our investments? Where is our dividend or piece of the American pie?

Here is a fact that every investor must understand. Your computer is slower than the big computers you are trading against. You cannot be faster at scalping than they are so, you answer must be to develop a trading plan and a strategy. We are not saying buy and hold, but rather know where you want to buy and where to take profits or where to sell and where to cover. Would you walk across the street without looking to see if traffic is approaching so why buy without understanding or, at the very least looking at the chart to make sure you are pricing your long or short appropriately.

Which markets have too much agreement to one side of the trade? There are several that jump out of the pages when you look; one is the US Dollar index. There are simply too many US Dollar bulls in the market. Can this continue? Well of course it can and likely will, but there will come a time when, the US Dollar will have enough of a drop to scare the weak handed bulls out of the trade. The same trade goes for gold, which is acting more like a currency and fear trade than an inflation hedge. Crude oil and the Euro have too many bears and will have the opposite problem. No, we are not telling you to buy crude oil and Euros but we are telling you that these trades are lopsided and will likely reverse.

Tuesday: April housing starts are released at 8:30 and April PPI is released a t8:30.
Wednesday: April CPI is released at 8:30 and the minutes of the FOMC two day meeting are released at 2:00.
Thursday: April leading indicator index is released at 10:00 and the May Philly Survey is released at 10:00.

The US Dollar index has been on an upside tear in recent days. We have a 9-count on the chart and signs of exhaustion. The problem with this is that the market can and likely will continue on its upside blow off for a while longer. Seriously, with the euro under fire, the Greek debt crisis not yet resolved and the other problems waiting in the wings, there seems to be good reason to either buy gold or the US Dollar. That said, we noticed that the boat is getting lopsided and there are far too many euro bears crowding the side of the boat. When too many agree, it may be time not to agree. That doesn't mean jumping on the opposite side but rather removing your short position on the euro. The 5-day moving average is at 85.097. The top of the Bollinger band is at 86.324 and the lower edge is seen at 79.927. Although we are overbought as measured by all the indicators that we follow herein, all indicators remain on a buy. Naturally, we are above the Ichimoku Clouds for the daily, weekly and monthly time-frames. We are overbought on the weekly time-frame and heading there on the monthly time-frame. The next targets are 87.22, 87.84, 89.47 and 89.71.

The S&P 500 futures contract retreated in the Friday session broadcasting the markets fear of something bad happening over the weekend when a trade could not be made. Naturally, we should see a relief in the Monday session. The downtrend line is at 1178.48 and we must close above that level to resume the bullish view of this market. Not one of the indicators that we follow herein is issuing a buy-signal. The stochastic indicator, the RSI and our own indicator are all issuing a sell-signal. The Thomas DeMark Expert indicator is going flat at overbought levels. We closed inside the Ichimoku Cloud on the daily time-frame; we are above the clouds for the weekly time-frame and are below the clouds for the monthly time-frame. We are entering an options expiration week, which could bring with it increased volatility. It will be important for the S&P 500 to remain above 1125 or risk a return trip to the 1100 area.

The NASDAQ 100 retreated in the Friday session but fell more than the S&P 500 did. The NASDAQ 100 must stay above 1887.40. We closed inside the Ichimoku Clouds for the daily time-frame. We are above the clouds for the weekly time-frame and just at the lip of the clouds for the monthly time-frame. The 5-day moving average is at 1940.90. The top of the Bollinger band is at 2093.97 and the lower edge is seen at 1870.84. The stochastic indicator, the RSI and our own indicator are all issuing a sell-signal. The Thomas DeMark Expert indicator is going flat at over bought levels. It really looks as though this index has some work to do rebuilding confidence. The downtrend line is at 1991.27. The weekly chart does not look as awful as the daily chart does. We closed up on the week but we have signs of exhaustion. The indicators are curling to the upside and will likely issue a buy-signal by the end of the week.

The Russell 2000 declined in the Friday session. The 5-day moving average is at 699.90. The top of the Bollinger band is at 755.32 and the lower edge is seen at 666.24. The stochastic indicator, the RSI and our own indicator all are issuing a sell-signal on the daily chart. The Thomas DeMark Expert indicator continues to issue a buy-signal at overbought levels. We are above the Ichimoku Clouds for the daily and the weekly time-frames. The market must stay above 685 or risk a return to 678, 670 and 667. If we don't remove 703 in short order, we could be setting ourselves up for another spill. Time will tell on this one.

Crude oil has been declining with the continued fear of an economic slowdown re-emerging as caused by the austerity programs needed to resolve some of the euro-worries. This is further amplified by the worries that the Asian communities are trying to slow down their growth to a manageable number. All of this is weighing on the crude oil market. Actually, until or unless we break much below 69 +/- there should be no worries about crude oil. We are just in a pronounced trading range. Of course should be break below 69, we will move out of that trading range and could be in a wilder ride. The daily chart is below the Ichimoku clouds. We are above the clouds on the weekly time-frame but in the clouds for the monthly time frame. We are oversold on the daily and weekly time-frames. We do not see even a bend in the indicators that would lead us to believe that we are at a bottom. We are grossly oversold. The 5-day moving average is at 74.96. The top of the Bollinger band is at 89.41 and the lower edge is seen at 72.03. We closed below the lower band and likely will not be able to stay there for very long. This should be an interesting week for crude oil.

It would appear that everybody loves gold. When this occurs, we get somewhat uncomfortable about our long gold stance. This could be a good time to remove some of the profitable positions in gold. The 5-day moving average is at 1224.24. The top of the Bollinger band is at 1180.49 and the lower edge is seen at 1116.88. All the indicators that we follow herein are issuing a sell-signal. We certainly would not go short this market but would consider removing some profits. We are above the Ichimoku Clouds on the all time-frames. If we trade above 1250, this market will have no resistance overhead and will likely cause the shorts to cover and the market to whoosh to the upside. After the initial piling into the trade, the market will likely return to the breakout level allowing the more conservative investor a chance to enter this market.

Crude oil prices plunged nearly 4% on Friday and were off almost 20% from their 18-month high less than two weeks ago, as the euro continued to lose ground against the dollar and U.S. oil inventories continued to build.

The benchmark West Texas Intermediate contract settled at $71.61 a barrel on Friday, down $2.79 on the day, compared with $75.11 a week earlier, and the lowest price in three months. Oil prices hit an 18-month high of $87.15 on May 3.

The euro on Friday reached its lowest point against the dollar since October 2008, falling below $1.24 from just above $1.25 on the previous day. As the dollar strengthens, it puts downward pressure on oil prices.

Oil futures fell below $71 a barrel in intraday trading, and analysts now feel that prices may test the $70 threshold. OPEC has repeatedly said it would like oil prices to stay in a range of $70 to $80 a barrel, and the oil cartel might be prompted to cut production if prices fell below $70.

The buildup of inventories continued to weigh on the Nymex contract. The European benchmark, ICE's Brent crude, which normally trades at a discount to WTI, settled at $77.18 on Friday.

The weekly inventory report from the U.S. Energy Information Administration on Wednesday showed an increase of 1.95 million barrels in oil stocks. In Cushing, Okla., the delivery point for Nymex crude, inventories rose by 784,000 barrels to a record 37 million barrels.

The oil price decline on Friday came in spite of an increase in the Reuters/University of Michigan consumer sentiment index for May. The index rose to 73.3 from 72.2 in April, indicating a possible pickup in demand.

Also on Friday, it was announced that U.S. retail sales rose 0.4% in April, to $366.4 billion - the seventh straight month sales have risen.

Pressure on the euro continued even though European leaders last weekend agreed on a nearly $1 trillion package to back euro zone members and the European Central Bank reversed its earlier position and agreed to buy member's government bonds to counter selling pressure in international bond markets.

While the oil spill in the Gulf of Mexico has seemed to have little direct effect on prices, President Barack Obama pledged on Friday that the U.S. government would review its regulatory procedures for oil companies in the wake of the accident.

Earlier in the week, the administration said it would split up the government agency responsible for offshore drilling so that supervisory and enforcement responsibilities would be separate from leasing and revenue collection.

Source: http://oilprice.com/Energy/Oil-Prices/Oil-Prices-Drop-Further-in-Week-as-Euros-Travails-Continue.html

By. Darrell Delamaide for Oilprice.com who offer detailed analysis on Crude oil, Geopolitics, Gold and most other Commodities. They also provide free political and economic intelligence to help investors gain a greater understanding of world events and the impact they have on certain regions and sectors. Visit: www.oilprice.com

Monday or Tuesday expect regulators to change the rules to the game. This should cause more volatility in my opinion as opposed to less but time will tell.

Crude and the distillates fell hard today as expected and prices hit our $72 price objective. Though it may be a few days premature clients were advised to start buying Crude today. We have yet to commit on futures but on signs of stabilization we will probe longs in July for clients next week. Today clients were buyers of $5 call spreads in August. We expect in the coming weeks to see this contract back in the mid $80's. The charts are ugly but sometimes you have to close your eyes and buy. Inside day in natural gas but prices managed to keep their head above water. Some clients still hold longs others took a profit yesterday when prices failed to get above $4.40. We are mildly bullish but need to see a settlement above $4.40 soon to remain in longs with clients.

Clients were looking for weakness into the weekend and the indices delivered cutting thru the 100 day MA and as of this post prices are near their lows down 2-3%. We expect more downside and have convinced most clients to hold there June ES puts anticipating 1075 next week. Sugar was down 3.6% today and is back below the 9 day MA. Hopefully not a false breakout but pay close attention to the action early next week. Clients are positioned long but will be forced to cut loses if we do not see a trade higher next week. We got partial fills for some clients to exiting their OJ longs. Continue to scale out of longs as we think a setback is on the horizon. Coffee lost 2% today; still we would like to see a trade closer to $1.30 before exploring longs for clients.

Treasuries remain in our opinion a sell rallies market but days like today remind me of the risk as prices were up over 1%. This trade may take a few weeks to develop so be patient. Live cattle broke down today but we failed to make a move as it happened so quickly. Prices broke the 20 day MA for the first time in several weeks so we think there could be more downside. A 50% Fibonacci retracement on the move from December would drag prices in August back closer to 89/90 cents. Lean hogs also broke down today closing below the 20 day MA. This is the confirmation we've been waiting for. Clients still hold August shorts and should be able to capitalize on a move under 81 cents.

Copper lost 4% today closing below the 200 day MA. Believe it or not clients that were long put options exited today at a small loss even with prices collapsing. This is the reason why we have no interest in trading copper options again on behalf of clients. Indecision in the gold and silver market today with wild trading ranges; June gold $32 and July silver 76 cents. We expect both to break lower but do not take this as a short recommendation we have just lightened up or exited longs for clients. Those not willing to leave positions were advised to tighten up stops.

Agriculture was hit today with prices on grains falling 1-2.50%. Clients will be buying this dip in corn via September options and December futures. Outside of that the only trade we like is long KCBOT wheat against short CBOT wheat. Clients exited their Loonie shorts from yesterday at a nice profit. Next week we will continue to sell rallies in the Loonie and Pound for clients. The US dollar ended the week strong gaining over 1% today. In our opinion this is near a trend change; look for more specifics in our commentary next week.

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

Bond and notes moved higher in early trade as equities struggled. After two consecutively strong Treasury auctions, and questionable fundamentals in overseas fixed income markets, the traders were anticipating strong demand for the 30-year.

Lofty expectations seemed to have just set the market up for failure. In post-auction trade, the long end of the curve dipped well into negative territory. The $16 billion issue of bonds went off at a higher than expected rate of 4.49%, a bid to cover of 2.6 and an indirect bidder take of 32.5%. Nonetheless, the selling was temporary and Treasuries migrated back to unchanged.

In economic news, weekly jobless claims were slightly worse than expected. However, the week's most notable data will be released tomorrow. We will start off the day with retail sales and then a little later in the morning we will have the Michigan Sentiment index and business inventories to digest.

Not much has changed, so we are holding with yesterday's commentary:

Based on action in other markets, we believe that the June T-Bond futures "should" have traded down to 119. This is a bit discouraging, but we are still looking for about 118'23 in the coming sessions. This would equate to about 118 in the June T-Note futures. Good luck!

**There is unlimited risk in naked option selling.

April 22 - Our clients were advised to sell the July bond 121 calls for 22 or better, and were filled this morning on the rally.

May 7 - Clients were recommended to buy back the July 121 calls and sell the July 124 calls instead. The swap was done at a debit of 1'20 and left some money on the table but the goal must be capital preservation at this point.

May 10 - Clients were advised to sell the July 115 put for 36 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

http://www.DeCarleyTrading.com
http://www.ATradersFirstBookonCommodities.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.

So far this week Gold has covered a $64.80 range with a low of $1184.40 ( Monday 5/10) and a high of $1249.20 (Wednesday 5/12). This latest rally has been fueled by the uncertainty of the debt crisis rescue package implemented in the Euro Region. On Monday (5/10) we learned the European Union and the (IMF) International Monetary Fund agreed to a monumental 720 billion Euro aid package in a move to support the heavily indebted nations and to preserve their currency. This sent a vote of confidence to the region and sent the equity markets higher and temporarily halted the gold rally and actually sent it $9.60 lower for the session. However , since then many financial
analysts , economists, and savvy investors have questioned the ability of those smaller Euro "debtor" nations to significantly cut deficits enough and more importantly repay the loans. The concern is also over the vast amount of Euro's that will be printed in order to inject money into the economies of these needy nations. The consensus has decided the whenever you print more it becomes "WORTH LESS".... This has brought out global fears of pending inflation and since gold and silver have a tendency to perform better than most commodities during inflationary times you can certainly understand the fuel behind this latest metals rally. It has clearly been a stampede to safer haven investments.

The Euro region continues to fuel the run to Gold as well as the demise of their currency on a daily basis..... European Central Bank President Jean-Claude Trichet's response to the following.....

Trichet was asked whether the financial crisis has changed "it is not the same crisis but tensions are continuing. At the beginning we had financial turbulence in 2007, then in mid 2008 we had an intensification of the crisis which hit the private sector worldwide and now we are in an episode where the creditworthiness of governments have been called into question and we are taking appropriate decisions".

Asked if the debt crisis was over...Mr. Trichet said "We need to remain vigilant" "it will depend on the capacity of public authorities and the private sector to take the appropriate decisions".

Today brought another wave of negativity to the region. Deutsche Bank CEO Josef Ackermann stated "He doubts Greece can repay debt in full, that Greek repayment requires unbelievable efforts"....and added "Italy and Spain are strong enough to service debt, but that is more difficult for Portugal " and in his opinion "the Euro
is fundamentally strong"....

Portugal's Prime Minister Jose Socrates and opposition leader Pedro Passos Coelho agreed on new austerity measures to drastically cut their countries budget deficit which includes a 5% pay cut for senior public sector staff and politicians.... the Socialist Socrates was quoted as saying " I ask all my compatriots for us to make this effort to defend the country, to defend the Euro and Europe"...

Spain also agreed to an austerity plan however, the Spanish Union (UGT) Union General de Trabajadores (Spanish Trade Union) has decided to protest the tough new government measures by calling for country wide strike scheduled for June 2nd . The Union urges "all public workers of different sectors of the country, from health to education to emergency services, municipalities, autonomous communities and government agencies, to observe a general strike on June 2nd ".....

Since the Chinese government implemented very stringent policies on their property market the citizens of China have been investing in Gold and other alternative investments (Diamonds & Silver) as a means to protect their new found wealth....Their appetite for gold is insatiable.

The jewelers of India have continued to buy "price dips" to re-stock for the Akshaya Tritiya festival which falls on May 16th . this is a Hindu Holy day which is auspicious for the giving of gifts of gold. Jewelers have reported actually running out of product on this occasion.

For the fourth week in a row the news on the Initial Jobless Claims front was good....The Labor department reported that in the week ending May 8th initial claims were 444,000 a decrease from 448,000..... That means 4,000 new Americans are working and receiving a pay check!

Despite the fact that both the gold and silver markets are technically over-bought global investors are turning to gold and silver as a "safe haven" investment. This trend could very well continue as long as the uncertainty in the European Union remains....

*AS OF THIS POST...GOLD SETTLED AT $1229.20*

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

*THERE IS EXTREME RISK TRADING FUTURES, OPTIONS, and FOREX*

Bulls make money in bull markets and bears make money in bear markets BUT pigs get slaughtered. We recognize most have heard this saying but are you applying this to your trading?

Lower high and lower low in Crude as prices traded lower again today making it 8 out of the last 9 sessions. Though we have not advised clients to get short we do expect a trade down to $72/73 in June. If we are correct with our assessment we should see downside in the distillates followed by a pop higher in the weeks to come. Natural gas is higher by 3.50% as of this post reaching a 2 week high. We are suggesting longs with clients thinking a trade above $5 is imminent. WHY you ask? A technical bounce, short covering, weather, strength from outside markets and as a contrarian play because no one else is looking for it.

Prices as of this post are at or just above the 50 day MA in indices; if we get a close above that level we would advise exiting all short futures. We will be hanging onto the ES puts for clients as we think still in the coming weeks we will see downside but with the futures we view the risk too great. July sugar poked above the 9 day MA for the first time in 3 weeks gaining 5.45% today. We continue to feel an interim bottom was made last week and anticipate a trade back to 18-19 cents in the coming weeks. Clients are advised to be long October 10′ and March 11′ contracts. A rally failed in cotton and we would position to take advantage of further downside.

We suggest exiting ALL remaining longs in OJ if we get a 2-4% appreciation as the chart is looking heavy. 30-yr bonds closed lower today for the fourth consecutive session; aggressive traders can continue to sell rallies. Live cattle failed to make a new high again today; we may have some bearish suggestions in the days to come...stay tuned. We advised clients to cut losses on their June lean hog shorts today but to hold onto their August. Clients in June lost approximately $125/per.

Silver traded to a fresh 2010 high but we've learned in this environment to take profits. There is likely more upside but we advised clients to lighten up and exit some of their positions. They booked a 30% net profit on most of their positions from just last week. Clients who wished to increase their exposure in metals were advised to buy June gold straddles. They bought $1300 calls and $1200 puts expecting a big move one way or the other in the coming sessions.

Agriculture was quiet though corn did trade above the 100 day MA for the first time in 2 1/2 months. Our suggestion would be to buy setbacks as long as the weather stays unfavorable and China is buying. The US dollar was the lone positive in forex today. As long as 1.5000 remains as resistance in the Pound we would suggest selling rallies. The Loonie is back at the down sloping trend line and should make a decision on direction tomorrow. We likely will be fading any rally.

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

June crude oil futures on the New York Mercantile Exchange last week saw a steep price decline of more than $10.00 a barrel. Serious near-term technical damage has been inflicted to suggest that a market top is in place in crude oil. Price action in June crude oil this week has been less volatile and more consolidative in nature. This pause after the recent high volatility has created a potentially bearish pennant pattern on the daily bar chart. A drop in prices below solid chart support at last week's low of $74.51 would produce more chart damage and would also suggest prices are seeing a downside "breakout" from the bearish pennant pattern on the daily chart. If a bearish downside price breakout from the pennant pattern does occur in nearby crude oil futures, the downside price objective, based upon measuring implications from the pennant pattern, would be the $61.00 area.

A close in June crude oil above technical resistance at this week's high of $78.51 would begin to provide the bulls with some fresh upside near-term technical momentum. Stay tuned! Jim Wyckoff

If you do not have the stomach for volatility our suggestion would be to take the week off. Crude oil is showing signs of life posting a higher high and higher low in today's session. Use a trade below $76 in June or above $79 as a sign of where from here. On further signs of an interim bottom we will be suggesting clients to gain long exposure. We've advised any traders who hold bullish positions in the distillates to use a 20 cent appreciation to exit remaining longs. June natural gas has managed a close back above the 9 and 20 day MA's jumping virtually 4% today. We remain convinced that a 10-15% appreciation is just around the corner. Look for ways to get long via future and options as we see a trade over $5 in the coming weeks.

The rally back in equities is spectacular but in our opinion short lived. There was too much damage done to the daily and weekly charts and as soon as the false hope of a resolution wears of from the actions over the weekend in Europe we expect another leg down. We feel all of these bailouts as nothing more than kicking the can down the road. We view upside resistance in the equities at the 50 day MA; in the S&P at 1170, 10800 in the Dow and 1960 in the NASDAQ. Sugar prices traded up to the 9 day MA but failed to get thru that level; in July at 14.55. We feel an interim low is close if not already in place and could see a trade back over 18 cents. Continue to sell rallies in cotton as we feel a trade closer to 75 cents is in the cards in the coming weeks. The only circumstance in which we would change our mind is a super bullish USDA report tomorrow so stay tuned. We would still like to see a lower entry in coffee and OJ before re-establishing longs for clients.

We are still suggesting selling rallies in Treasuries; as we said in the commentary we expect most if not all of the recent gains to be given back. We still need to see a settlement below the 20 day MA to confirm a move lower in lean hogs; clients are short June and August via options. The divergence lives on in metals with gold slightly lower and all other metals catching a mild bid. Our client's exposure is long silver via a small position in July futures and September call spreads. As for copper clients remain short via put options and on a trade closer to $3 in July we will look to unwind. Corn and soybeans were flat ahead of tomorrow's USDA. Wheat was lower by 2.5-3.5% today. The December KCBOT/CBOT spread picked up just over 2 cents. We expect currencies to trade all over the place this week. We most likely will be looking to sell rallies in the US dollar and Pound but have no specifics on our radar as of yet. Today the BoE left rates unchanged at 0.50%.

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

The U.S. dollar might not have the strongest fundamental backing, but it is the best of the worst when it comes to representing stability. Accordingly, despite criticism of the Fed's monetary policy and quantitative easing, when the going gets tough, money flows into the U.S. Treasury bonds and notes were a direct beneficiary of capital inflows from overseas during the height of last week's panic.

Suddenly the meager yields offered by U.S. fixed income products seemed attractive given the perception of little default risk. On the other side of the coin, many argue that the domestic balance sheet isn't dramatically better than that of Greece. Nonetheless, panicked market participants needed somewhere "safe" to park cash and Treasuries were the preference.

An emergency IMF meeting and an EU rescue package brought cooler heads to the markets to trigger a treacherous decent from the Thursday/Friday highs. However, the volatility might not be "dead". The Treasury will be auctioning 3 and 10 year notes along with 30 year bonds this week, Bernanke will be speaking, the economic calendar is healthy and the stock market visibly shaken.

We would be lying if we told you that we could confidently speculate on what might happen tomorrow. However, we are leaning lower overall but respect the prospects of a last gasp rally that could bring the June bond as high as 122ish before a larger roll-over can happen.

I have been a broker for over six years now and have had the pleasure (and pain) of witnessing a lot of incredible things; but the end of last week was among the most challenged market conditions. I've seen larger moves in bonds in a single trading session, but I have never seen the fear that was displayed in this move. The bids and asks disappeared on the electronic options and when they came back, they were enormously wide. This made it nearly impossible to trade options via electronic execution. However, on Friday we were able to get what we felt to be fair execution in the open outcry pit. For those without access to open outcry (trading with some discount brokers who only offer electronic products), it might have been a very expensive lesson! Any money saved in commission would have paled in comparison to the cost of trying to exit (or enter) a bond option online.

* 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.

April 22 - Our clients were advised to sell the July bond 121 calls for 22 or better, and were filled this morning on the rally.

May 7 - Clients were recommended to buy back the July 121 calls and sell the July 124 calls instead. The swap was done at a debit of 1'20 and left some money on the table but the goal must be capital preservation at this point.

May 10 - Clients were advised to sell the July 115 put for 36 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

http://www.DeCarleyTrading.com
http://www.ATradersFirstBookonCommodities.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.

Are we all having fun yet? Don't you just love the volatility? As an option seller, we do. If you are a call writer this environment is your dream. As a put sell, you have to love those premiums.

Fat finger......we don't think so. Most systems will not let you enter orders in the billions without a second review like to say "is this what you really want to do?" Good excuse... but it's only slightly better than "my dog ate my homework" in its credibility. Part of the reason for the free fall in the Thursday session can be attributed to mob mentality. The original stops placed in the markets caused, upon their election, a whoosh to the downside but then computers, or quants, noticing the downdraft piled into the trade accelerating the downdraft further. This was further complicated by NYSE stocks that were electronically halted compelling the market makers on the NYSE floor into action to make an orderly market, a slower market but orderly nonetheless. This caused some of the electronic sellers, looking for an exit, to abandon their NYSE platform and place those exit trades on the NASDAQ which, took full advantage of the situation and accommodated the trades.

A major problem causing this market meltdown is the extinction of trading floors, where some of this craziness was controlled. Machines just trade because of triggers, people actually think. True we can teach machines to think but they have difficulty reversing and adjusting as fast as the human can. The swings on Thursday are proof of this. The computers sold bought sold and when it was all over, a plunge of nearly 1000 points was reversed and the market gained back about 600 points by the end of the session. We need to obliterate trading halts or have all exchanges, including NASDAQ respect the same trading halts. On another front this Thursday accident speaks volumes to the value of the trading pit and the exchange floor market makers. When standing in the pit, you know who is selling and you know who is buying. True there are shenanigans always but they are a small price to pay for true price discovery and a true auction market. Electronics certainly have their place but to the credit of the people in the ring and on the floor that trade and fill our orders, the execution might be a tad slower but the results will be less chaotic. We have been both an electronic trader and pit trader. Both work well together but not to the exclusion of the other. Both should have the same rules of the road. We know that many who bought the Thursday low of the market had their fills canceled. This is another question which needs to be sorted out. If we cancel trades in this manor why would buyers step in? Wouldn't they be afraid of a subsequent cancellation and thus not provide the bid that the market needs to stabilize. If we remove those bids, where would the market stop if it would stop before a limit trading halt would be enforced? These are good questions and ones that need to be answered. The answer is a level playing field with uniform rules for all, not just for NYSE or whatever exchange has made a rule but for all exchanges.

We are sure that you would like to know where the market is going to go next week. Monday's have been up days in the market because the world survived the weekend and nothing major happened to cause the markets to blow up. That said, a relief rally appears and the all clear signal is sounded. This week, we don't expect to see a repeat of last week's craziness. We do expect to see a rally to at least 1117.03 and more probably 1136.12. The markets will remain nervous and the monthly expiration of options will add some increased concern. That said, we expect to see calmer waters in a sea of manic behavior.

Monday: the Bank of England releases its interest rate decision.
Tuesday: March wholesale inventories are released at 10:00.
Wednesday: March international trade is released at 8:30.
Friday: options expire at the end of the day, April retail sales are released at 8:30, April industrial production / capacity utilization are released at 9:15, May Michigan sentiment is released at 9:45 - 10:00 and March business inventories are released.

The US Dollar index retreated in the Friday session removing some of the excesses seen in the Thursday session leaving an inside day on the chart with signs of exhaustion. We are grossly overbought as measured by the stochastic indicator, the RSI and our own indicator. The Thomas DeMark Expert indicator is flat and slightly above neutral levels. The chart shows that the US Dollar index is forming a pole, the question is will the pole resolve into a bear or bull flag, or perhaps a pennant. In other words, the future direction is not clear from the recent trades. We would expect to see the US Dollar retreat in the coming sessions. A return to 82.87 and the uptrend line at 82.380 is likely. The 5-day moving average is at 83.945. The top of the Bollinger band is at 84.691 and the lower edge is seen at 79.325. During this past week we saw the US Dollar index trade above the upper Bollinger band for four of the five trading days. Friday, the index closed just below the upper Bollinger band. We are above the Ichimoku Clouds for all time frames. Euro fear is a wonderful thing for the US Dollar bulls. Remember as the dollar rallies, dollar based commodities will decline, making commodities more expensive for importers. Likely this will all smooth out. We have gotten used to seeing these sorts of extremes. This time is not different just the location is different.

The S&P 500 futures retreated this past week. The Thursday hysteria neared the February low of 1040.75 and came within a cat's whisker of electing the circuit breaker trading halt. The Thursday low was 1056. The action in the Friday session was far more subdued than the Thursday session and left a resulting inside day on the chart. We are oversold by all the indications and measures that we follow, yet we are getting mixed signals. Our own indicator is curling to the upside and could, in the next session, issue a buy-signal. The Thomas DeMark Expert indicator is flat at the oversold line, the stochastic indicator is curling over and could issue another sell signal at slightly above oversold levels. We expect to see the S&P 500 futures trade to the 1117.03, 1136.12 and possibly 1155.21 levels. Things are not going to return to the upside until some of this fear is worked off. We below the Ichimuko clouds for the daily and the monthly time-frames and remain above the clouds for the weekly time-frame. The 5-day moving average is at 1152.90. The top of the Bollinger band is at 1241.05 and the lower edge is seen at 1132.81. This should be a very interesting week.

The NASDAQ 100 retreated in the Friday session with a lot less volatility than seen in the Thursday session leaving an inside day on the chart. The indicators that we watch are giving us the same signals as that seen in the S&P 500 futures contract. The signals are mixed some showing that we will likely rally and some saying that we will not. It is our opinion that we will try to stabilize this week and we will likely rally into options expiration. Resistance will be found at 1855.39, 1894.12 and at 1932.85. The 5-day moving average is at 1937.90. The top of the Bollinger band is at 2101.37 and the lower edge is seen at 1899.47. We are inside the Ichimuko clouds for the daily and the monthly time-frames but are above the clouds for the weekly time-frame. When market suffers the damage seen this past week, they need to take some time to repair themselves. Thus most rallies will be met with seller and most retreats with buyers, but the buyers will be willing to take only limited risk on their trades. Thus we should see the S&P outperform the Russell 2000 as risk is removed from the market. We expect to see stabilization return to these markets in the coming week. Be prepared for the worst and hope for the best.

The Russell 2000 continued to slide in the Friday session. We continue to see mixed signals as generated by the indicators. The Thomas DeMark Expert indicator is trying to turn to the upside. We are getting a sell-signal from the stochastic indicator and our own indicator looks as though it might issue a buy-signal tomorrow or perhaps on Tuesday. The RSI continues to point lower. There is resistance at 763.23, 689.90 and at 700.56. Still we believe that if the market is going to take a less risky approach to the market, this index will underperform the rest of the market that is until the all clear signal is sounded. The 5-day moving average is at 691.92. The top of the Bollinger band is at 756.34 and the lower edge is seen at 671.63. The waterfall spill that occurred last week paints a picture of panic. When cooler heads prevail, the market will likely adjust its downdraft to a less sever waterfall pattern. We closed inside the Ichimuko clouds on the daily chart and above the clouds for the weekly chart. Both the weekly and the monthly charts are overbought and continue to issue a sell-signal.

Crude oil closed below the Ichimuko clouds in the Friday session leaving a large red candle on the chart. Crude oil has been down four out of the five trading days this past week. As to the indicators, crude oil is grossly oversold but shows no signs of reversal. Much of crude oils recent problem stems from the strength in the US Dollar. Some of the concern about the fragile global economies is bleeding into the crude oil market which is dependent on a certain amount of growth to continue its upward movement. There is also some concern about a possible slowdown in the expansion seen in China. The 5 day moving average is at 80.224. The top of the Bollinger band is at88.75 and the lower edge is seen at 77.52. We closed below the lower edge of the Bollinger and will likely move back inside the band.

Gold seems to have an evening star at on its daily chart. Gold is grossly overbought and continues to point to higher levels. The 5-day moving average is at1187.04. The top of the Bollinger band is at 1201.6 and the lower edge is seen at 1124.20. Although we have been somewhat of a gold bug for a while, we believe that gold has gone a bit further than it should have and will likely retreat in the coming week. We continue to buy gold on reasonable dips.

Oil Market Summary for: 03/05/2010 to 07/05/2010

In a week of market turmoil resulting from Greece's fiscal crisis, oil went from an intraday high above $87 on Monday - its highest point in more than a year and a half - to plunge briefly below $75 on Friday.

The Greek crisis, exacerbated by a still-unexplained "glitch" in U.S. stock trading on Thursday that saw the Dow Jones Industrial Average plunge 9% in a matter of minutes before recovering, sent financial speculators scrambling for the sidelines, liquidating their long positions.

The benchmark West Texas Intermediate contract settled at $75.11 a barrel on Friday, its lowest point since February, compared to $86.15 a week earlier - a decline of nearly 13%.

Friday's announcement of an unexpected increase in the unemployment rate to 9.9% in April from 9.7% in March cut short any hope of a rebound following the 3.6% drop in oil prices on Thursday amid the gyrations in the stock market.

U.S. government data on Wednesday showing that crude oil inventories had increased by 2.8 million barrels - almost double expectations - lent momentum to the price decline that began on Tuesday as unrest in Greece and uncertainty about its bailout raised fears of the crisis spreading to other Eurozone countries.

The European crisis not only threatened to stifle economic recovery, but also pushed the euro down below $1.30, further depressing the dollar-denominated oil price.

Fears grew in the market that even at $140 billion, the bailout package for Greece would not be sufficient to resolve the country's fiscal crisis, especially as strikes and riots that have claimed three lives continued to roil the nation's capital.

The knock-on effects of a credit crisis at other highly indebted euro zone countries, such as Spain and Portugal, and the threat to European banks that hold a lot of European sovereign debt also spooked equity, bond and commodities markets.

The German parliament on Friday approved the Greek bailout, but Chancellor Angela Merkel faces a tough political test in a regional election on Sunday in North Rhine-Westphalia, Germany's most populous state. German backing is seen as crucial to any effort to keep the crisis from spreading and to keep the euro intact.

Source: http://oilprice.com/Energy/Oil-Prices/Crude-Oil-Plunges-as-Turbulence-Rocks-Financial-Markets.html

By. Darrell Delamaide for Oilprice.com who offer detailed analysis on Crude oil, Geopolitics, Gold and most other Commodities. They also provide free political and economic intelligence to help investors gain a greater understanding of world events and the impact they have on certain regions and sectors. Visit: www.oilprice.com

Not just a canceled television show but an accurate description of most major asset classes. This volatility will persist at least into next week so be careful there is no reason to be a hero. In just over one week oil has given back gains from the last three months. There will be a time to get long but first we would like to see if the $72 level in June will be challenged. At this point we are more interested in probing long than selling rallies. We may have some bullish ideas next week...stay tuned.

This still holding onto longs in RBOB and or heating oil if we get a 15-20 cent rally for whatever reason we suggest unwinding all your positions as we think an interim top is in place. Natural gas appears to be forming a base as prices have wandered in a 15 cent trading all this week. Our suggestion remains purchasing September 50 cent call spreads. Cocoa was lower by nearly 6% today, on a trade below 3000 in July which serves as a 61.8% Fibonacci retracement cocoa longs start to be on our radar. July sugar touched 13 cents today but pared its losses closing at 13.75. We are advising buying October 10′ calls and March 11′ calls. We may start to get clients long futures if we see a bounce early next week.

Aggressive traders could start to gain short exposure in Treasuries; possible suggestions would be purchasing puts, short 30-yr bond futures (with stops) or NOB spreads (short 30-yr bonds long 10-yr notes). Clients are short June and August lean hogs expecting the 20 day MA to give way and the gap from late March to be filled. Gold closed above $1200/ounce for the first time in 2010. We may see a new record high next week but as most followers know we prefer silver and clients are back in as of today. As we said yesterday we wanted to wait till the NFP #, which came out well above expectations at 290,000?#!@ Clients were advised to buy $2 call spreads in September silver thinking the next leg will lift prices to $20.50/20.75. Clients that already did not have exposure in corn were advised to buy September calls today.

We do not suggest having all your eggs in one basket though being it is possible we get a bearish USDA report next Tuesday. Soybeans and soy meal are starting to show signs of life but we've yet to make a move and will likely wait for the USDA report before committing capital for clients. We will re explore the idea of short exposure in wheat as well next week.

As of this post the dollar is down for the first time in four sessions. On the week it looks like we should close up about 3.25%. Currencies by far have been the most volatile commodity sector this week so we would suggest only the risk adverse trade here. Additionally recommendation this afternoon may be different this evening and surely Sunday evening so for specifics contact us or check out our commentary issued Monday morning. Our clients only open position in currencies is September Loonie 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.

Thus far this week has provided plenty of fuel for higher Gold prices as the economic climate in the European Union continues to drive savvy investors out of the traditional "fiat currencies" and in to "safer havens "especially gold as it has a history of performing better than most commodities in times of crisis. It has been reported that the European states have increased their already vast amounts of gold reserves and the IMF (International Monetary Fund) reported it had sold 18.5 tons of Gold bullion in March. As of this writing the price of Gold has breached the $1200.00 per ounce level as the U.S Dollar continues to ride twelve month high's ....yes indeed the inverse relationship appears to de-coupled...

This European Union continues to put out contradictory information that is as clear as "mud". European Central Bank Officials voted Thursday to keep the bank's key lending rate at 1%. The Euro regions fiscal crisis is threatening the bank's of Portugal, Spain, Italy, and the United Kingdom. Moody's Investors Services was quoted as saying
"Overall, moody's notes that each of these countries banking systems faces different challenges of different magnitudes, but warns that contagion risk could dilute these differences and impose very real, common threats on all of them"...

European Stocks sold-off for the third straight session sending the STAXX Europe 600 to a two month LOW on the continued concern of the Euro regions fiscal crisis will spread....

European Central Bank President Jean-Claude Trichet Is certainly not calming fears as he has resisted to take a solid stance to combat the Greek crisis. Trichet stated "The ECB didn't discuss buying government debt today and that Spain and Portugal didn't have the same challenges faced by Greece".... Then stated "Greece will not default".....
Trichet also stated that loans to Greece were "appropriate" ...

The Greek's took to the streets in protest for the second straight day in reaction to the stringent measures imposed on them in return for the joint financial bail-out package from the IMF and the European Union. This may actually work against the nation of Greece as tourism is a huge part of their economy and the violence will most certainly deter travelers.

The number of Americans filing claims for Jobless benefits fell 7,000 to 444,000 in the week ending May 1st. This is the lowest level in a month....Since the recession began in December 2007 Americans have lost 8.4 million jobs. So we certainly have a long way to go! However, it is a step in the right direction and it does show the economy is heading in the right direction.... Well....let's wait and see what the Unemployment data due out FRIDAY...7:30 am (CST)......REFLECTS .....

GOLD IS TECHNICALLY OVER-BOUGHT and has been for two weeks....BUT the world's consumers don't care!!! They are seeking investments that have a history of retaining value in times of financial stress...Believe me the European union is under stress... Therefore the "flight to safer havens".....

Let's 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*

Days like today in the market separate the men vs. the boys. Any day markets move 5% in just minutes there is an opportunity to make a lot or lose a lot of money almost instantly. Some panic, others capitalize, others watch in awe. We were not in the right place with clients everywhere but today was a good day.

Oil traded below $75 for the first time since mid-February. This move has shaken out a number of longs and though we've yet to buy once the selling slows we may have some long suggestions. From here we could move $5-7 in either direction in a moments notice so we would not suggest either direction. If a rally comes in the distillates we would again advise liquidating longs as an interim top was likely made early this week. Natural gas futures made a new low so depending on your stop placement you most likely were stopped on your long futures. Buying September call spreads remains our top pick here.

The correction has arrived but we did not anticipate this magnitude; intra day the S&P was lower by over 100 points, the Dow over 800 and NASDAQ nearly 200. We used this move to lighten up on some of our shorts but most clients still are holding some ES shorts. Clients were advised to lightly start buying sugar today; most bought October 18 cent calls. Aggressive clients got short cotton today as we are expecting a trade to near 75 cents in July in the weeks to come. The higher 30-yr bonds and 10-yr notes trade the more we're interested in shorts. Clients have yet to move but on a rally on the NFP tomorrow we may start scaling in. The short end of the curve is rolling over. It may make sense to have some downside positions on here.

Soybeans and soy meal got hit hard today losing 2.50% and 1.60% respectively. We will be looking to get clients long but from lower levels. Overnight into tomorrow on a trade lower in corn we would suggesting getting long. June lean hogs closed below the 20 day MA for the first time since we gapped higher in late March; clients remain short. Gold is back above $1200 gaining nearly 3% today. This is flight to quality but we missed the boat as the divergence in other metals had us concerned. Clients have no exposure. The 100 day MA appears to be holding in July silver but we want to wait for the NFP # tomorrow before making a move for clients. July copper closed below the 200 day MA today; we expect more downside.

Futures are the way to trade this market not options in my opinion. MADNESS that is all I can say about currencies today. Clients took off their shorts in the Loonie today in June and lightened up on their September puts. As long as this fear premium is in the market expect the Yen and Dollar to gain and the others to falter. If you cannot stomach volatility look elsewhere.

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

July soft red winter wheat futures at the Chicago Board of Trade have recovered in solid fashion from early last week's sharp downside price action that produced what was at the time a big and bearish "outside day" down on the daily bar chart. An outside day down occurs when the session high is higher and the low is lower than the previous session's trading range, with a lower close. The wheat market bulls have kept in place a four-week-old uptrend on the daily bar chart. Prices are now also closing in on strong overhead technical resistance that is located at the April high of $5.14 3/4, basis July Chicago wheat futures. A close above that price level would open the door to a quick challenge of chart resistance at $5.25. Above that lies stronger chart resistance located at the March high of $5.36 3/4.

Chart support for July wheat futures is located at Wednesday's low of $5.02, at $5.00 and then at $4.91. A close below technical support at $4.80 in July Chicago wheat would provide the bears with fresh downside near-term technical momentum to suggest a retest of the contract low of $4.60 1/2, or below. Stay tuned!--Jim Wyckoff

In the last three sessions Crude has come down $7 in June futures. Prices have retraced over 50% from their February low and April high but we do not think sellers are done. At this moment we are expecting $76-78. Clients are neither long nor short at the moment. The near 10% correction in the last two days in heating oil and RBOB may be the beginning of a trend change so bears get ready and bulls we suggest using rallies to exit any remaining longs. We continue to suggest light longs in June futures in natural gas as long as the recent lows hold. Clients were filled on their September 50 cent calls spreads they've been trying to buy in recent sessions. We expect within that time frame if not sooner to see prices trade back above $5.

Day two of the correction in indices with prices below the 50 day MA as of this post. On further downside our objectives are as follows: 1135 in the S&P, 1890 in the NASDAQ and 10600 in the Dow. Sugar has been lower 11 out of the last 12 sessions but prices are oversold enough that we've started to track pricing in October 10′ calls and March 11′ calls. Contact us for exact pricing. Though we were lower on the session July closed over 1/2 cent off its low. Assuming we get a bottom around these levels our long objective would be around 19 cents. Clients attempted to get short some October cotton today and just missed their limit; we will try again tomorrow.

We may have a triple top in the making in June 30-yr bonds...this should be on your radar. We could have bearish option suggestions for September contracts in the coming sessions. Corn continues to be a buy on dips market. Our suggestion remains to be long July via options and December via futures. Hold off buying soybeans and soy meal until we see lower ground. June lean hogs closed down 2.36% today and on a penetration of the 20 day MA just below 84.00 expect 81.00. Gold was able to close positive on the day after trading to a one week low in early dealings. We are not advising shorts but have refrained from getting clients long as of yet thinking there is more downside to come. We would start to be interested closer to $1135 in June but still cannot rule out $1100...yes you heard $1100. July silver traded below the 100 day MA for the first time since late March having lost 7% in the last two sessions. We see support at $17, $16.85 and then $16.40.

This market can be unforgiving so tread lightly. We've yet to re-establish longs but most likely will this week or next...stay tuned. Copper traded well below the 200 day MA but did manage a 13 1/2 bounce to close just above that level. We suggest tightening up stops on shorts as we may get a bounce from here. Never again will I trade copper options; the bid/ask today was $1000 wide. This market is BROKEN. The dollar picked up nearly another 1% today trading to new highs, as long as this continues look for more downside in other crosses. Clients remain short the Loonie and will look for an exit door near .9550-.9600.

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

Gold Settles $5.80 Higher .... ($1175.00)

Another choppy and volatile day as investors experience a wild roller-coaster ride in the gold. The Globex (electronic market) covered a $20+ trading range as European Union uncertainty continues to fuel the global markets. This uncertainty has been the driving force in the recent appeal and rising prices in the gold as investors have chosen gold as their currency of choice as a "safe haven" in times of crisis.

Germany's Deputy Finance Minister Asmussen was quoted as saying "He had no knowledge that the European Central bank is going to buy Spanish or Portugal's "bonds".... " He is confident that German lawmakers will approve the Greek aid" and stating "Germany has a special responsibility to the Euro and Germany's policy will not be influenced by public opinion"....

European Central Bank Governing Council member Axel Webber stated that "the European Union needs tougher deficit rules and cited the "Greek crisis is mainly due to domestic reasons".... He also conceded that the strict implementation measures
imposed on Greece are "painful but necessary".... Greek citizens protested the measures and riots ensued.

It has been reported that Moody's is reviewing all 10 rated Portuguese banks for a possible downgrade...........

Goldman Sachs outlook revised to "NEGATIVE" from Stable ...by Fitch.....

Many Gold Bugs have pondered the possibility that the IMF (International Monetary Fund) may sell some of their 167 metric tons of Gold to help pay for the aid package to bail-out Greece. The IMF sold 18.5 tons in March. During this period Europe had reported they had increased their already vast reserves...

REPORTS: Thursday 5/6
EXPORT SALES......................7:30 AM (CST)
INITIAL JOBLESS CLAIMS....7:30 AM (CST)

MY SWING NUMBERS... 5/6... JUNE GOLD...
RESISTANCE # 2..............$1191.00
RESISTANCE # 1..............$1184.00
Pivot ................................$1170.00
SUPPORT # 1...................$1162.00
SUPPORT # 2...................$1149.00

LETS TALK GOLD !

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

*THERE IS EXTREME RISK TRADING FUTURES, OPTIONS, and FOREX*

DATA RELEASES 05/05/10
8:15 am ADP Employment Report
10:00 am ISM Non Man Index-56.4
10:30 am EIA Petroleum Report

DATA RESULTS 05/04/10
US Factory Orders (1.3%/-0.1%)
US Pending Home Sales Index (5.3%)

US DEBT REVIEW AND OUTLOOK

Fears of another global credit contagion, this time in sovereign debt-the supposed lender of last resort- prompted traders and investors to move capital into lower yielding, more secure US Treasury Debt. US 30 years powered through a number of technical resistance levels to close at their highest level since the Dubai debt scare in November of 2009. US 30 years closed over a point higher as participants sought out the highest secure yield to ride out the volatility caused by the uncertain outcome of the Greek bailout package and the seemingly inevitable domino effect of other over leveraged countries coming to the bailout table.

Treasuries also gained from the highest percentage gain in the US dollar for over a month. The greenback closed at its best level of the year as risk aversion swelled, causing a move into lower yielding currencies. A rise in the US dollar increases the overall yield return for dollar denominated securities such as Treasuries, especially when they are repatriated back into other currencies.

TECHNICALLY SPEAKING - Technical resistance was broken at 119-15, which should set up as a pullback support level from near overbought conditions. The markets strong close could mean continued upside movement to 120-22. This could represent the top end of the new range and may be a key point to implement longer term short positions.

US EQUITIES REVIEW AND OUTLOOK

Stocks gave back Monday's gains and more as renewed concerns regarding the outlook for the euro zones sovereign debt and economic growth. Financial, energy, and materials led the tumble Materials stocks came under additional pressure as China implements new banking reserve requirements in order to quell inflation. Risk aversion and profit taking overcame strong readings on US factory orders and pending home sales. It just didn't matter as the markets perceive the possibility of a new credit contagion, this time led by overtaxes sovereign debt. Market participants looked to sideline into higher yielding secure US Treasury debt as the "Sell in May and Go Away" strategy appears to be attempting to set an early foothold. However the major indices did bounce off some key technical support

TECHNICALLY SPEAKING - June S&P futures recovered off support level at 1168.00. This could lead to establishment of near term lower trading range with pullback to 1178.50. A retest of 1165.00 could lead to continued downside move to new target of 1158.80.

COMMODITY HIGHLIGHTS

Blood on the street throughout most of the commodity sector as expectations of slowdown from China and strong close in the US dollar hit the market

Prepared by Rich Roscelli & Paul Brittain.
Please voice your market opinions, thoughts, and questions by email to 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.

Gold Settles $14.10 Lower Today... ($1169.20)

Today's Gold market made yet another new 2010 high ($1192.80) prior to an avalanche sell-off mid-session. Gold had been ignoring early U.S Dollar strength and much lower energy prices as it continued to reflect its "safe haven" status as the currency of choice.
However, this Gold market has been "top heavy" and technically over-bought and in need of a correction. The technical resistance between $1190.00 & $1195.00 produced some heavy selling volume and this coupled with the continued uncertainty in the European Union caused the "BULLS" to take profits and starting the "golden" snowball downhill . The selling frenzy took out support levels and executed "stop loss" orders
taking gold as low as $1166.90 before support re-emerged.

Investors remain skeptical concerning the ongoing European Union debt scenario which seems to change and worsen every day. The extreme 110 billion Euro price tag to aid Greece has investors speculating to whether the European Central bank will be forced to
"print more money" to offset Greece's debt. Anytime you print more money it becomes "worth less" and raises concerns of possible "inflation" to follow...

Spain and Portugal are under extreme pressure to get their inflated budget deficits under control if they are to seek aid from the European Union. Spain's Prime Minister Jose' Luis Rodriguez Zapatero was in Brussels and was quoted as saying "the Greek plan shows credibility of EU, shows solvency of Europe " and "Greece has what it needs, economic growth is vital, and sees sacrifices by Greek citizens"

Mr. Zapatero also stated "the rumor that Spain is seeking a bailout is "complete madness"......"we have restructure the financial sector and adapt to a smaller credit market"....

The Reserve Bank of Australia raised rated by ¼ or 25 basis point at their policy meeting...current rate is 4.50% ....

Maybe this is the dip the jewelers of India were looking for. Gold buying has been sluggish in India due to recent high prices.

My Swing Numbers for 5/5...(Wednesday)... June Gold
RESISTANCE # 2..................$1200.00
RESISTANCE # 1............... ..$1185.00
PIVOT ..................................$1176.00
SUPPORT # 1.......................$1159.00
SUPPORT # 2.......................$1150.00

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*

The bid for bonds and notes heading into the weekend faded on Monday, but the day hardly went to the bears. Despite overbought technical action, higher stocks and good economic news, Treasuries suffered only moderate losses.

The equity markets reacted positively to Greek debt bailout developments, but fixed income traders don't seem to buy into the theory. There seems to be some underlying support in bonds and notes as investors question whether high yielding sovereign debt is worth the risk.

On the economic front, the Institute of Supply Management's manufacturing index ticked up to 60.3 to suggest growth. Construction spending was also a bit better than most were looking for an increase of .2%

In theory, Treasuries should be finding a seasonal peak sooner rather than later. However, seasonal tendencies are guidelines not rules. Despite normal market behavior, we can't rule out a dramatic key reversal in which the long bond rallies sharply before putting in an intermediate-term top.

If you are following our short call recommendation, we are a little uncomfortable. Despite the loss per contract being relatively manageable at this point, we feel that the risk of open positions in this market is a little higher than is normally the case. We would like to see a pullback in the long bond to 117ish. If seen, we will likely be in favor of pulling the plug (likely at a moderate profit) on the trade.

In the meantime, we see resistance in the June 30 year bond futures near 119'23 and then again near 121. In the 10-year note this translates into 118'01 and then 118'23.

* 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.

April 22 - Our clients were advised to sell the July bond 121 calls for 22 or better, and were filled this morning on the rally.

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

http://www.DeCarleyTrading.com
http://www.ATradersFirstBookonCommodities.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.

Base and precious metals no longer appear to be correlated, Treasuries inverse relationship to indices no longer exist, dollar up equals commodities down right...wrong. When things do not make sense take your position size down.

Mixed results in Crude today with the front month lower and back months gaining. Take for instance just the first 2 months at the beginning of April this spread was at a 25 cent discount and today it is approaching a $3.00 discount. We got the trade over $87 in June we were looking for but without a new contract high over $87.59 in the coming sessions we expect a set back. We are still advising energy traders to use the most recent spike higher in prices in the distillates to take off longs. Last weeks lows have held so far in natural gas as prices picked up nearly 2% today. We've yet to make a move but for the right price in the coming sessions we like buying clients August and September call spreads. Contact us for more precise details.

Inside day in the indices but the bounce back is impressive. Continue to use the 20 day MA on the daily charts as your pivot point. We've been anticipating a correction like most but it has yet to materialize. Coffee was higher by 2.4% today lifting prices back to the 100 day MA. On a trade above $1.40 in September clients should hit their profit orders...check back tomorrow as today's settlements should come in about $100 less than their limit. Not yet but at some point this week clients will likely be buyers of October 10′ and March 11′ sugar...stay tuned. Euro-dollars were off nicely today; aggressive traders could be short futures with stops above the recent highs. Clients will be using this rally in Treasuries to get short futures...stay tuned.

Clients are long June 30-yr bond puts expecting a trade closer to 116′00 in the coming weeks. Agriculture was in the red today with soybeans and soy meal suffering the most. Expect to buy this correction but from lower levels; closer to $265 in July soy meal and $9.40 in July soybeans. June live cattle traded higher for the third session today back near 96 cents. We may not get the correction anticipated in cattle so we need to go back to the drawing board...stay tuned. If hogs fail to rally tomorrow we will most likely be adding to shorts for clients.

We're still thinking the gap in the charts about a nickel lower needs to be filled. Gold traded to fresh highs but it just does not smell right so we advised clients to liquidate their long future and options at a small profit and move to the sidelines for the next 24-48 hours. We are still waiting for a correction in silver to get clients positioned long. We missed the most recent correction and seem to be reminded of it every day. That is not necessary and we should be there next time. Copper broke the 100 day MA today and has given up over 30 cents in the last month; clients remain short looking for more.

We advised clients to take a profit on their Pound shorts today around 1.5250. We expect currencies to trade off the dollar this week; a close above 82.50 expect more upside and on a close below 82.00 expect more downside. The RBA should raise IR 0.25% tomorrow so 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.

The US stock market is resilient and seems to want to rally. The only thing that will prevent this market from returning to the April highs will be an event that will cause fear to return to this euphoric market. We have seen European downgrades and an attack on Goldman Sachs, neither of which was bad enough to send some fear into this market. We need to see an event like a failed Treasury Auction. That is not going to happen anytime soon because money is flowing back into our currency and our markets. The yield starved investor is taking more risk daily just to get some returns on their portfolios. At the current money market rate, you are losing money and not keeping up with costs.

Although the VIX rallied from a low of 17.47 to a high of 22.39 this past week, we believe that we could see the VIX at 29 or 30 in the near term. Investors and traders alike would love to see some volatility return to this market. Volatility helps the options sellers get the returns they need. Meanwhile the US 10 year treasuries are comfortably below 4% and will not compete with returns achievable in the market. It is thought that once the treasuries yields above 5% or 5.25% that they will compete for dollars earmarked for the US equities markets. For right now, we seem to be miles away from that competition.

Another factor that needs to be considered is; should the dividend preference treatment be removed, money will again flow into the debt market. At the moment that tax benefit has encouraged investors to buy high yielding securities rather than debt instruments whose income is ordinary income and taxed as such. Should the Congress neither pass nor not renew that preference item it would help make the case for investors to invest in bonds rather than stocks.

Monday: March personal income/consumption is released at 8:30, March construction spending is released at 10:00, and April ISM is released at 10:00.
Tuesday: March factory orders are released at 10:00.
Wednesday: Challenger Gray & Christmas April job cut announcements, and ISM nonmanufacturing index for April is released at 10:00.
Thursday: 1st quarter productivity and Federal Reserve Chairman Bernanke speaks.
Friday: April nonfarm payrolls and unemployment rate are released at 8:30 and March consumer credit is released at 3:00.

The US Dollar index retreated in the Friday session with some of the money flowing to the Euro. The uptrend line for the Monday session is at 81.77, we remain above the uptrend line. The 9-day moving average is 81.799, which is very close to the uptrend line for the Monday session. The top of the Bollinger band is at 82.553 and the lower edge is seen at 80.224. We are above the Ichimuko Clouds for the daily time-frame but are in the clouds for both the weekly and the monthly time-frames. All the indicators that we follow are issuing a sell-signal on the daily chart of the US Dollar index. For the weekly and monthly charts, the indicators continue to issue a buy-signal.

The S&P 500 futures contract lost 1.8% of its value in the Friday session. The 5-day moving average is at 1193.60. The top of the Bollinger band is at 1215.32 and the lower edge is seen at 1174.50. There is a resistance line at 1208.15 which should serve to stop most rally attempts. There should be some support at 1176.25. Further support will be seen at 1151.67 and at 1146+/-. At the moment, the chart pattern looks like a head and shoulders top. We need to see 1176.75 removed to confirm that pattern. The stochastic indicator, RSI and our own indicator are all issuing a continued sell-signal with plenty of room to the downside. The Thomas DeMark Expert indicator is issuing a buy-signal. The long-term uptrend line is at 1054. Look at the point and figure chart. You can see the head and shoulders formation. There is a downtrend line at 1204.44 and an uptrend line at 1184.36. Remember Bob Farrell's Market Rules; "Markets tend to return to the mean over time. Excesses in one direction will lead to an opposite excess in the other direction. The public buys the most at the top and the least at the bottom." These are just three of the ten "rules of the road." We are above the Ichimuko Clouds for both the daily and the weekly time-frame but are below the clouds for the monthly time frame. Both the weekly and the monthly oscillators are overbought and curling over to the downside. Once the weekend is over, expect to see some of the buyers return to the market as the weekend fear is removed.

The NASDAQ 100 has a bearish engulfing candle on the chart. The 5-day moving average is at 2020.45. The top of the Bollinger band is at 2058.85 and the lower edge is seen at 1962.97. The stochastic indicator, the RSI and our own indicator all continue to issue a sell-signal. The weekly and monthly indicators, except for the flat DeMark, are issuing a sell-signal. The Thomas DeMark Expert indicator is going sideways a little below neutral for all time-frames. We are above the Ichimuko Clouds on all time-frames. We have signs of exhaustion on all time-frames. We will have some concern if the market trades below 1991.50 because we will be in the Market Profile single print area.

The Russell 2000 has a bearish engulfing candle on the chart as a result of the Friday trading session. All the indicators that we follow herein are issuing a continued sell-signal on the daily and the weekly charts. Only the stochastic indicator is issuing a sell-signal on the monthly chart, the other indicators continue to point higher at overbought levels. We have signs of exhaustion on the chart for both the weekly and the monthly time-frames. The chart indicates to us that we need to see a defense of the 708 level. The 5-day moving average is at 726.76. The top of the Bollinger band is at 743.10 and the lower edge is seen at 687.77. We closed the Friday session at the 20 day moving average.

Crude oil rallied in the Friday session. The downtrend line for the Monday session is at 86.65. We have an important high just overhead, that high is at 87.59. Should the market remove that level we will likely see a run to 90 and then to 93. We are above the Ichimuko Clouds on all time-frames. All the indicators that we follow herein are uniformly issuing a continued buy-signal. We will likely see some resistance at the 50% retracement level (from the high of 147.27 and the low of 32.48) of 89.96. The 5-day moving average is at 84.23. The top of the Bollinger band is at 87.34 and the lower edge is seen at 81.78. We have a long-term target of 105 for crude oil.

Gold rallied in the Friday session removing the previous month's high of 1169.00. All the indicators followed herein are issuing a continued buy-signal albeit at overbought levels. The 5-day moving average is at 1167.20. The top of the Bollinger band is at 1178.56 and the lower edge is seen at 1127.00. With all the global chaos, the PIIGS, Goldman Sachs and the oil spill in the Gulf, what would you expect? Naturally gold went on a trip to the upside of the chart. Naturally, we are above the Ichimuko Clouds.

Oil Market Summary for: 04/26/2010 to 04/30/2010

Stubbornly high crude oil inventories continued to stymie bulls through the middle of the week, but the market seized on positive economic data to push prices higher toward the end of the week.

The oil spill from a collapsed rig off the Gulf coast may also have played a role in firming prices. Analysts said that the spill could have a short-term impact on supply if it interfered with oil deliveries to Gulf coast refineries, and a longer-term impact if it led to new restrictions on offshore drilling.

The gains on Thursday and Friday enabled oil futures to offset the decline in the first part of the week and finish higher on the week, with the West Texas Intermediate benchmark June contract settling at $86.15 a barrel on Friday, compared with $85.12 a week ago. The contract traded below $82 at one point during the week.

The news Friday that consumer spending powered U.S. GDP growth to a 3.2% annual rate in the first quarter spurred oil prices to further gains after Thursday's report of a continuing decline in jobless claims also boosted the outlook for oil demand. Analysts also cited the Federal Reserve's upbeat assessment of the economic situation following the Federal Open Market Committee meeting on Wednesday.

But the weekly inventory report from the Energy Information Administration showed crude stocks up nearly 2 million barrels, with inventories at the New York Mercantile Exchange depot in Cushing, Oklahoma up by 450,000 barrels, and this weighed on the Nymex contract.

The high inventories at Cushing have enabled the European benchmark contract, the ICE Brent crude, which normally trades at a discount to the WTI contract, to overtake the Nymex contract, with the gap this week at times widening to more than $3 a barrel in favor of Brent oil. Brent crude settled at $87.11 on Friday.

The situation has also kept oil futures in contango - later-dated contracts are priced higher than the nearest month because traders expect prices to improve when inventories decline. The July contract on Nymex closed at $88.36 a barrel on Friday.

Oil prices rose on Friday even as stocks plummeted, with the Dow Jones Industrial Index accelerating its decline in late trading to finish down 158 points to 11,008 as financials were hit by news of a criminal probe of Goldman Sachs.

Source: http://oilprice.com/Energy/Oil-Prices/Economic-Data-Oil-Spill-Push-Crude-Prices-Higher-at-End-of-Week.html

By. Darrell Delamaide for Oilprice.com who offer detailed analysis on Crude oil, Geopolitics, Gold and most other Commodities. They also provide free political and economic intelligence to help investors gain a greater understanding of world events and the impact they have on certain regions and sectors. Visit: www.oilprice.com