That is a loaded question because investing in commodities is not safe however if a clearing firm goes out of business and you have a futures account the answer is yes. With the passing of MF Global I was asked this question a number of times today so I wanted to put all prospective commodity clients at ease. Let me be clear trading commodities is not safe but money at an FCM in segregated account...that my friends is safe.

Crude oil continues to exhibit signs of an interim top trading down 0.90% as of this post. On the December contract we see solid resistance at the $94/barrel level and we continue to operate under the influence that we see prices closer to $87 in the very near future...trade accordingly. Natural gas has closed positive the last two sessions lifting prices over the down sloping trend line mentioned in previous blogs. Aggressive traders can start gaining bullish exposure in January contracts. Stocks may have sucked longs in with the over extension last week but a correction appears to be under way. A breach of the 9 day MA's just below today's lows should confirm an interim top. If we see further downside momentum look for the Dow to find its way quickly to 11300 and the S&P to 1185...trade accordingly.

Traders that were long gold or silver were advised to offset their positions today and move to the sidelines. December gold is having trouble getting through $1750 to the upside and on the downside a break of $1700 should lead to a retest of $1650. Silver is back under the 40 day MA losing nearly 4% today. Longer term we are extremely bullish but from here we feel a trade back to $32.50/33.00 is in the cards...trade accordingly. The dollar recouped 2% today with all crosses getting hit largely influenced by outside markets and the BOJ intervention. We got the move we've been forecasting in the Yen with three months of up movement erased in one session but look for a further sell off in the session to come. With the increased volatility our suggestion is purchasing options as opposed to futures.

Continue to fade any rallies in sugar and coffee. Coffee is on the verge of making fresh 2011 contract lows and sugar should see an additional 5-8% downside. With the MF Global turmoil and liquidation in commodities and equities money flowed back into Treasuries with 30-yr bonds and 10-yr notes gaining traction closing back over the 20 day MA. Look for further easing in other markets to help lift Treasuries further...trade accordingly. Forced into the market we would rather be short than long in the Ag sector but at the moment have advised clients to move to the sidelines. Exit all remaining live cattle shorts as prices are approaching a value zone in our eyes. We will likely be a buyer of 2012 contracts this week for clients if prices stabilize...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.

After all the huge moves we experienced yesterday one would expect follow through today which did not happen. Next week as a new month begins it will be critical to pay attention where the money flows. As long as Crude does not make new highs we like scaling into bearish short exposure thinking an interim top was made this week. Once prices roll over a leg lower should drag prices down to between $85-87 barrel in the December contract. Natural gas picked up 4% today and is bumping up against the down sloping trend line that had served as for resistance for the last six months. The next few sessions will be critical to see up we finally have a technical reason to buy...stay tuned.

No follow through in stocks today as prices failed to make a new highs on a narrow trading range. Clients hold bearish plays in ES options and are currently under water. Support is seen at 1250 followed by 1215 and ultimately our target at 1185 in the S&P. Gold will close slightly lower but manage to remain above its 50 day MA; in December at $1737. This week's action was one sided and the bulls are clearly back in the driver seat but do not rule out wild swings, use some sort of strategy to mitigate risk i.e. stop loss orders, options or keeping your size small. Silver remained above the 40 day MA closing slightly higher above $35/ounce now for two days.

We see support just below that level with resistance between $36.50-37/ounce. With the Yen near contract highs we still like scaling into short exposure...this trade has not started to work but on a BOJ intervention which we still anticipate expect a quick 300-500 point move. Sugar gave up 2.6% today closing near the weekly lows. We suggest bearish exposure looking for a trade below 25 cents next week. After a massive run that lifted OJ prices nearly 25% prices have started to come off and should trade lower in the coming weeks. Treasuries traded lower two out of the last three weeks but the picture still is not clear so we would recommend the sidelines in this complex.

Corn closed above the 200 day MA so we would cut losses on all shorts and move to the sidelines. Clients have been whipsawed in soybeans as this market cannot make up its mind on direction. Some clients hold small bullish exposure in January contracts and are under water. From here it will take a trade back near $13.20 to get these trades profitable once again. We think that is feasible in the coming weeks...trade accordingly. Live cattle have retraced 61.8% closing today at one month lows. On lower trade next week we will be offsetting clients remaining shorts and potentially reversing advising bullish exposure in 2012 contracts...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.

European Vacation - May be one of my favorite Chevy Chase movies but in this case describes where the policy makers heads are at. Seriously when will governments get out of the way and let systems fail and stop kicking the can down the road. On what planet should a 50% write-down be viewed as a a positive? Crude is higher by almost 4% as of this post but a triple top is in the making at least that is my interpretation. We have been selling this rally for aggressive clients thinking we are headed lower into next week. Our first target in December remains $86.50. Natural gas being cheap is not enough to get long...I find myself saying this everyday to clients. Either the fundamentals need to shift or we need a close above $4 as I've said in previous posts for me to be interested in bullish exposure. We've advised hedgers in heating oil and RBOB to back off establishing new hedges as we feel prices have gotten ahead of themselves.

A 3-6% rally off the European non-solution to me is far overdone perhaps a contributing factor is market manipulation as hedge fund redemptions will likely be rampant the next few days. As scary as it is aggressive clients are fading these rallies in equities and energies. Gold has completed a 50% Fibonacci retracement and on its way to $1775 all but erasing the entire loss this market had experienced the last two months. The 40 day MA at $1717 should now support. Silver ran into some mild resistance just above $35/ounce; the 38.2% Fibonacci retracement level. We may take a breath but moving forward next upside target is $36.50/37.00. We had all but written off clients Swiss franc call options but they have managed to fight back from the dead and on further appreciation they may eke out a profit...stay tuned.

Any shorts should have been stopped out on the breakouts today as the dollar collapsed. The Yen was higher but by the smallest margin as clients remain in their bearish trades targeting a trade back near 1.2750. Continue to scale into bearish trades in sugar. Treasures collapsed as the safe money is leaving debt instruments and entering risk assets. 10-yr notes and 30-yr bonds are at two month lows and appear to be heading lower...trade accordingly. The 200 day MA is still acting as stiff resistance for additional upside in corn. If that continues remain short, on a further appreciation cut your losses on any shorts. Finally soybeans are back above the 50 day MA. We have light bullish exposure and are targeting a trade back to $12.85 and potentially $13.15 in January. Day there of the live cattle correction but we're expecting more with a downside target of 1.19 in December and 1.2150 in February...trade accordingly. Tighten up stops in lean hog shorts or lighten up on options as we may be getting close to a value zone.

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

Across my Reuters terminal today I thought I was seeing things with talk of deflation. Has anyone looked at longer term pricing on commodities say over the last ten years...Really? Crude will close lower by 2.5% today trading back near $90/barrel after being within spitting distance of $95 just yesterday. A 38.2% Fibonacci retracement drags December Crude to $86.50 while a 50% retracement puts Crude at $84.50...trade accordingly. We are advising clients scaling into to bearish exposure. Both RBOB and heating should see further bouts of weakness as well into next week. Natural gas cannot get out of its own way as prices continue to dance around their contact lows. Wait for a settlement above $4 in December to gain long exposure. Stocks traded below their 9 day MA's but failed to penetrate that pivot point on a closing basis. This level has held for the last two weeks but we do expect a breach very soon.

A close below 1210 in the S&P and 11550 in the Dow should signal lower ground. We have lightly started to gain bearish exposure in ES put options with some clients targeting a move in the futures to 1180. Gold is above its 40 day MA for the first time since 9/22...what a wild ride as prices sold off nearly 15% and then proceeded to rally back 12% inside of one month. The physiological level of $1700 should now support with upside targets of $1740 and potentially $1770. Expect wild swings and our suggestion is purchasing options unless you can swallow the volatility. Silver was higher by 1% today briefly trading close to $34/ounce. As prices get out of their recent congestion area we see little upside resistance until $35/ounce...trade accordingly.

Aggressive clients can start to get short the European currencies with stops above the recent highs. Those long the Swissie should let go of their longs if we are not higher tomorrow. Our largest open currency position for clients exists in the Yen as we look to be put in an interim top. Our feel is we get a violent move to 1.2750 in the coming weeks...trade accordingly. Sugar gave up 2% today as prices were unable to hold onto the 100 day MA. Scale into short as a trade under 25 cents in the March contract is expected. Treasuries like equities are trying to make a decision on direction as sideways action continues. We have no open positions but favor a move to the upside in 10-yr notes and 30-yr bonds. We view better risk/reward scenarios elsewhere so steer clear for now.

Corn is back below its 9 day MA for the first time in three weeks as this should be the beginning of the correction we've been looking for. As long as the 20 day MA caps any upside build bearish exposure. The 50 day MA has contained upside in January soybeans now for the last four sessions. If we do not see a trade above that level we may let go of client's soybean longs at loss...stay tuned. Live cattle broke down 1% today as prices approach three week lows. A 61.8% Fibonacci retracement drags February back near $1.21 ...where longs would be back on our radar. Trail stops on your short lean hog futures or start working out of some of your put options booking profits. A near 5% deprecation in the last week should allow that.

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

A number of markets are at critical points and will decide in the next few sessions if prices reverse from current levels or we have a change in trend. Notable markets include stock indices and Crude oil. Crude was higher by nearly 5% today lifting prices to three month highs above $91/barrel. We do not trust this move but the momentum is bullish and continues to be until we get a settlement back under $88/barrel. Aggressive clients hold a small short position which are now under water. Be careful about getting too long of a position because if you want to weather this trade there is no serious resistance until $95/barrel in December. We continue to caution investors about picking a bottom in natural gas. Wait for a settlement above $4 before gaining bullish exposure.

Stocks have completed a 61.8% Fibonacci retracement as our targets were realized in both the S&P and Dow today. Like Crude oil we feel prices have overshot to the upside but you're jumping in front of a freight train getting short. We do think stocks are overvalued but we prefer the sidelines until an interim top is made. Gold appreciated 1% toady but remains range bound and the sidelines is our trade until we get a clearer picture. Silver gained 1.6% but until we break above $33/ounce or below $30/ounce on a closing basis we suggest the sidelines here as well. The US dollar as competed a 61.8% Fibonacci retracement trading to a seven week low. The easy money has been made on bearish plays as we could get a bounce from here...trade accordingly. Some clients continue to sell the Yen near contract highs thinking even verbal intervention from Japan should get the Yen to ease in the coming sessions. Our target remains 1.2750 in December contracts. Currency traders that are long should tighten their stops as we are approaching over bought levels across the board.

Use a further appreciation in coffee and sugar to re-establish bearish trades. We see March sugar under 25 cents and March coffee below $2.30 in the coming weeks... trade accordingly. Treasuries traded lower again today but considering the action in outside markets we would have expected much more. Use the 20 day MA as your pivot point...as long as we stay below that level remain bearish and the reverse on a trade above that level. Corn is back below the 200 day MA having trouble holding onto any gains in recent sessions. Aggressive traders could start gaining bearish exposure as long as the recent highs hold. Soybeans and wheat performed better with beans gaining 1.2% and wheat higher by 1.7%. We have opted to stay away from wheat with clients but have a small bullish position in January soybeans with some clients. On a close above the 50 day MA at $12.47 we would be looking to add to their position. Lean hogs were lower again today making today the fourth consecutive loser. Aggressive traders could have bearish exposure thinking we get an additional 2-4% depreciation. Still waiting for a break lower in live cattle to be a buyer of 2012 contracts...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.

Just when it looks like a market is on the verge of breaking down or breaking out to the upside the market reverses. Two examples: Stocks appear that they are moving higher bonds look like the are trading lower but we are not believers of either just yet. We're suggesting the sidelines in a number of trades at this time. As of this post Crude is higher by 2% trading close to its weekly highs. The volatility continue so keep your size small. We are still operating under the influence that Crude is a sale above $88/barrel and a buy under $78/barrel. Lower trade was rejected again in natural gas but prices were unable to retake their 9 day MA. Prices are cheap but that is not reason enough to be long. Wait for a close above $4 before establishing bullish exposure.

Equities will close higher for their fourth consecutive week finishing out the week with a 2% gain. Prices should make a run at their 61.8% Fibonacci retracement levels at 1245 in the S&P and 11820 in the Dow. After four losing days gold picked up 1.7% to resister one positive day this week. We feel it is a coin toss and have advised clients to move to the sidelines. Silver was higher by 3.3% today after losing about that amount yesterday. We favor being long if you have a longer time horizon but all bets are off in the short run as we cannot rule out a retest of $26/27 before we see a leg higher. We have advised no new entries until we get a break lower. Copper lost 6% yesterday and gained 6.5% today...that my friend is indecision.

The US dollar broke the 50 day MA today trading below that level for the first time since the beginning of September. On further downside look for the international crosses to gain strength. Our pick for those looking for a bullish allocation is the Swissie as it has got hit the hardest in recent months. Some clients remain in their bearish Yen positions and we still favor a break lower. Continue to scale into shorts in sugar being we were unable to trade above 28 cents the last two weeks we likely put in an interim top. Coffee gained 6% today to lift prices to one month highs. On further appreciation closer to $2.55 we will be establishing bearish trades for clients...stay tuned. 30-yr bonds managed to squeak out a very slight positive trade on the week but clearly the momentum is shifting to the bears. Out first target is 136'16...if that level gives way we could see 134'00.

Corn mid-day looked like a breakout but prices closed on their lows so let's see what happens next week...stay tuned. We still like buying breaks in soybeans thinking in the next few weeks they have the best upside potential in this complex. A settlement back over the 9 day MA at 12.50 in January would get us interested in adding to existing longs for clients. Aggressive clients can gain bearish exposure in lean hogs as long as we do not make new contract highs stay the course. Live cattle have traded below their 20 day MA's but have yet to close below that critical pivot point. We are waiting for a further break before establishing bullish plays for clients in 2012 contracts.

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

Maybe it is the money some clients have lost on their longs or maybe I'm getting a better feel for the market but I expect prices to head south in a number of commodities...trade accordingly. Crude will close virtually unchanged today but the volatility continues as $2,500-4,000 daily ranges are becoming more and more common. We expect prices to trade lower and continue to operate under the influence that Crude is a sale above $88/barrel and a buy below $78. In December futures 3.75-3.80 continues to support natural gas but wait for a move higher to confirm that an interim bottom is in. Stocks were surprisingly resilient today holding onto slight gains as of this post. We are incapable of picking a top but a close back below the 9 day MA would signal that we are due for at least a pullback.

That pivot point comes in at 1205 in the S&P and 11425 in the Dow. Another flush lower in gold with prices down $25/ounce trading to two week lows. We advised clients to cut losses on their gold longs today. Silver gave up nearly 2.5% today briefly trading back under $30/ounce. Clients were advised to cut loses on their silver longs today as well. The fact that copper lost 5% today and is off 10% this week does not bode well for commodities moving higher in the immediate future. The dollar was unable to hold onto gains reversing mid-day closing under the 34 day MA again. Clients continue to scale into bearish exposure in the Yen anticipating a trade down to 1.2750 in the coming weeks.

Cocoa cannot get out of its own way on a rally in the coming sessions move back to the sidelines. Exit all remaining futures longs in November OJ. Tomorrow is options expiration and we expect a trade below $1.70 in futures. Use downside into the weekend tomorrow to exit 30-yr bond bearish trades. Corn reversed to our surprise and is on the verge of breaking above the 200 day MA...a feat that we had expedited but we anticipated a trade lower first. A close over $6.60 in March triggers buy signals. January soybeans closed lower again today but were able to pare loses almost fighting back into positive territory. Live cattle were lower again today making their way back to the 20 day MA. We may get a window to offset December shorts for clients on a further break. As for February a 50% Fibonacci retracement drags prices back near 122.50...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.

Hands down the recent months have been the most challenging markets to trade in my career. I think it is a combination of uncertainties, volatility and the undeniable correlations between different asset classes. Tomorrow is the ltd for November so December is now the lead month in Crude oil. After a spike on the EIA today Crude reversed and as of this post is $3.50 off its highs. We likely put an interim top in today and now should trade from the short side looking for a trade back under $80/barrel. I have had a number of clients try to navigate this market and lose money because the volatility. Do not be afraid to trade small size and even options. A volatile market and too little capital is not a good recipe.

My suggestion is to be a seller above $85 and a buyer closer to $77 and do try to navigate new positions in the middle of the range for what it's worth. Outside market influence mainly the dollar and equity markets will continue to influence oil. For instance a trade lower in stocks and higher in the greenback will only accentuate a move south in Crude. Continue to wait for a breach of the down sloping trend line in natural gas...no need to pick a bottom. Being the market is overbought and failing to make new highs we think the run higher is complete. However you do not get confirmation of a sell signal until the S&P breaks 1180 and the Dow breaks 11200 so getting short before that happens is extremely risky. The next trade we do if we venture into these waters is likely bearish exposure in the S&P but we've yet to commit capital...stay tuned.

Gold closed lower for the third consecutive session giving up $10/ounce today. The recent action is testing my bullish resolve but for now we stay the course with clients. In recent weeks we've been advising purchasing February bull call spreads. Inside day in silver with prices in December futures down 2.5%. Most clients have bullish exposure but we will need to hold onto the $30.30 level or we would quickly lose faith. Silver's sideways action the last two weeks represents a coiled spring so once a decision on direction is made we expect a large move...the trick is to be on the right side. Our clients are long in full disclosure. A break below the 50 day MA or above the 34 day MA is where the dollar is headed. We favor a break down with a target of 76.40. Aggressive clients continue to scale into bearish exposure in the Yen which of late has been like watching paint dry but in our opinion a large decent is just around the corner.

In the softs sector we like buying March cocoa and selling March sugar. It is too early to call a bottom but yesterday MAY serve as an interim low in cocoa...stay tuned. Sugar lost 3% today and is on the verge of breaking the 100 day MA. On a breach of that level at 25.75 in March expect an additional 3-5%. Treasury traders remain in their bearish 30-yr bond trades holding out for a trade closer to 137'00 to offset. Move to the sidelines in corn as we should be able to re-establish longs from lower levels. Soybeans broke the 50 day AM today so futures traders should be out and looking to buy at lower levels . As for option traders we will weather a bit more heat and potentially buy back our top leg as we are in January call spreads for some of our clients. There appears to be a correlation between the S&P and live cattle so if we are correct with our assessment in the stock market look for the correction in the cattle market that we've been forecasting . Aggressive traders could get short with stops above the recent highs but the preferred trade is to buy a break in 2012 contracts. We see a challenge of the 20 day MA in the near future...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.

When constructing a trade make sure you understand the risks and have realistic expectations. The volatility is here to stay so traders need to make sure they are flexible and mange the trade once you're in the market. This is not your father's commodity market! Surprisingly...at least to me Crude oil is approaching $90/barrel, a level not see in about five weeks. We have advised clients to scale into shorts of late being prices are at the upper end of a trading range we've seen in the last eleven weeks. We're approaching our threshold of pain to admit we're wrong so stay tuned. In two short days natural gas is 25 cents lower back near the contract lows. Picking a bottom here is not advised and we would not be getting long until the down sloping trend line is penetrated; in December just above $4. Stocks erased yesterday's losses closing up 2-3% today. We caution being long at these levels and are more eager to establish shorts for clients if we get a push higher; a 61.8% Fibonacci retracement lifts the S&P to 1245 and the Dow to 11820.

Today's close in metals should look a lot better than the open for metal bulls as gold prices as of this post are $33 from their lows. Follow through over $1700/ounce is needed for confirmation and then next stop should be $1730. Silver managed to fight all the way back to close positive trading back over $32/ounce after approaching $30/ounce in early dealings. Those brave traders that have stayed long may get some redemption as we're getting more buy signals as our target remains $35/ounce in December. A settlement over $33 is needed...which is a level that silver has been unable to tackle since the massive correction in late September. Again today the dollar failed to remain above the 34 day MA reversing mid day. The next few days will be critical to see on what side of 77.50 prices will fall...stay tuned. Aggressive traders can continue to scale into bearish exposure in the Yen as we love the risk/reward dynamic at these levels. Our target remains 1.2750 in December contact.

A new low was rejected in cocoa futures today...if we hold onto these levels tomorrow we may be re-establishing longs in March cocoa for clients...stay tuned. Aggressive traders can start scaling into bearish plays in sugar... a possible play is short futures and selling out of the money puts 1:1. OJ traders that are long and in a profit should move to the sidelines. On further upside in stocks we may get a window to lift 30-yr bond shorts closer to 136'16-137'00...jump at that opportunity. Continue to buy dips in corn and soybeans that hold the 9 day MA...you will notice today that both corn and soybeans tested their MA's today. We have missed some upside for clients in live cattle of late but we're still confident we get a break and are able to buy 2012 contracts from lower levels. Our thinking now is pay close attention as contacts approach their 20 day MA's.

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

Based on today's action it appears money is leaving the stock market and going elsewhere. We see money finding its way into the dollar, Treasuries and commodities ...there was no clear winner at least today. Crude oil has reached over bought levels and based on outside market influence we still are thinking a correction should happen in the near future. With a slight bounce in the dollar and lower trade in the stock markets we expect December Crude back near $82/83 in the coming weeks...trade accordingly. With the 1.5-2% decline in the products today we think further weakness will drag Crude lower. At its highs natural gas traded to the trend line mentioned in previous posts but by the session's close prices are lower by nearly 1.5%. A settlement over $4 in December has longs back on our radar.

A 50% Fibonacci retracement may be all we get in the indices as they retreated 2-3% today. Use 1215 as resistance in the S&P and 11600 in the Dow. Aggressive traders can gain bearish exposure looking for a grind lower to the bottom of the trading range. Even with a $10 loss in gold prices maintained the 20 day MA and all other major support. We are cautiously optimistic but would like to see a trade over $1700/ounce for further confirmation. Some clients have recently purchased February bull call spreads. In the next day or two silver should make a significant decision on direction...next stop should be $35 or $29/ounce. A trade below the 9 day MA at $31.75 supports lower trade while a trade above the 20 day MA at $32.30 likely means higher trade. Most clients have bullish exposure anticipating $35/ounce.

The dollar index bounce off the 50 day MA today but we expect just a bounce before the slide continues...trade accordingly. Currency traders should be out of all their longs in the Euro and Aussie. Aggressive traders could continue to scale into bearish plays in the Yen looking for lower trade. Aggressive traders could scale into shorts in sugar as we expect prices to find their way back to levels we were at two week ago; approximately 12% lower than current pricing. On a trade back near 138'00 in 30-yr bonds offset remaining bearish trades.

We opted to exit clients remaining longs in corn as we've been unable to break above the 200 day MA for the last five sessions. On a trade lower we will re-establish longs in next year's crop...stay tuned. Some clients remain long January soybeans but we will need to see a trade above last week's highs very soon or we will likely advise moving to the sidelines here. For the last two sessions live cattle have had trouble holding onto their gains closing well off their highs. Those long may want to book profits and we may get the correction we've patiently been waiting for very soon...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.

High flying equities and optimistic economic data helped to push yields higher and Treasuries lower on Friday. Although the week tends to end with counter trend moves, each of the financial markets experienced price changes in the direction of recent trade. There could be many explanations for this, but the incredibly light volume leads us to believe the buying in stocks and selling in Treasuries was the result of traders "stuck" in unfavorable positions lightening their load (or maybe even throwing in the towel) ahead of the weekend. After all, a nearly 9 handle move in a little over a week for the 30-year bond could have easily been too much for some bulls to handle.

On the economic front, retail sales were reported at a much better than expected 1.1% (estimates were calling for .6%) and import/export prices were relatively stable. The Michigan Sentiment came in at 57.5 despite expectations for 60 but it was still considered a decent reading relative to the dooms-day environment we were in just a few weeks ago.

The Fed has been actively buying in the long end of the curve compliments of Operation Twist, but they are also active in some intermediate-term maturities. Today, they purchased $4.6 billion worth of securities with expirations from 2019 to 2021 through POMO.

We are optimists at heart but this move in the financial markets has probably been too, too fast...even if the trends continue.

This morning's economic data was relatively neutral for bond traders. Initial claims dropped modestly to 404,000 and the trade balance was slightly smaller than expected at -$44.8 billion. Similarly, Fed buying, uncertainty over Europe and a seasonal tendency for higher Treasury prices has us leaning higher in the short-term.

The last few days have seen choppy and directionless action and this tends to enable stop orders on both sides of the consolidation pattern to form. Our best guess is that we see some sort of modestly new low (to run the sell stops, of course) before turning around and growing rally legs.

Look for support in the 30-year bond in the mid to low 137's to be a bull, and in the note this equates to about 127'10.


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

Treasury Bond and Note Option and Futures Trading Recommendations

**There is unlimited risk in naked option selling.

9 - 6 - Some clients are holding synthetic puts in the 5-year note in which they are short December futures contracts and long December 123 call options. Depending on entry, total (limited) risk on the trade is between $700 to $800 and we have until late November for something to happen.

10-7 Clients were advised to sell a December 5-year note 121.50 put for about 24 ticks. This reduces the cost of the trade and hedges against a possible bounce during the holiday weekend.

10-11 Clients were recommended to offset the short 5-year note future and the short 121.50 put for a combined profit of about $900 before commissions and fees and dependent on exact entry and exit prices. However, losses on the original hedge (long 123 calls) diminish the profit. We are looking for a Treasury recovery to give us an opportunity to offset the long call at a much better price (smaller loss).

In other markets....

10-11 Clients were recommended to sell strangles in the November Euro (142/128 for conservative traders and 140/130 for aggressive traders), or December crude oil (98/67 for conservative traders and 96/70 for aggressive traders).

(Our clients receive short option trading ideas in other markets such as gold, crude oil, corn, soybeans, Euro, Yen, and more. Email us for more information)

Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading

cgarner@DeCarleyTrading.com

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

twitter.com/carleygarner
www.linkedin.com/in/carleygarner

www.DeCarleyTrading.com
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.

My suggestion is do your research and put on smaller positions and participate in less trading as the volatility can clean traders out if they trade the same as they did in times past. As of this post Crude is higher by 3.5% trading to its highest price in one month and above the down sloping trend line mentioned in previous posts. We could see further upside lifting prices to $90 so do not add to shorts until we see if this is a false break out or significant trend change. The products were higher by 3% as well today with heating oil back over $3/gallon and RBOB approaching its August highs. We think prices have gotten ahead of themselves but we would not fight the move with the distillates as two weeks ago an interim low was established. We suggest buying breaks and instituting additional hedges if we get a break in the coming weeks. Natural gas picked up 4-5% today and in two days prices are nearly 25 cents off contract lows. We still would not jump long until we get a settlement over $3.80 in November...which could happen next week so stay alert.

The indices picked up just under 2% and have advanced 14% in the last two weeks on very light volume. We've completed a 50% Fibonacci retracement and though clients will be absent on further appreciation a 61.8% retracement would lift the S&P an additional 25 points and the Dow approximately 250 points...trade accordingly. Gold will close up $40 on the week and close out today above the 20 day MA for the first time since mid-September. The key next week will be a close above $1692...if we fail look for a trade back to $1600. We favor an upside move and have some clients positioned in call options into 2012. Silver remains range bound but the fact that the 9 day MA held this week is mildly supportive. Most clients have bullish exposure and are using hedges via futures or options to mitigate downside in an attempt to lessen the volatility. We see support in December just under $31 and on a close above $33 we should see $35/ounce within a few sessions...trade accordingly.

The dollar has lost just over 4% in the last two weeks and the momentum has clearly shifted from bullish to bearish. We have a target now at the 61.8% Fibonacci level at 76.30 in December. Our upside objective have been met in the Euro and Aussie but all other crosses have lagged. If long aggressive traders could stay in open positions. As for fresh entries we are scaling into shorts with clients in the Yen with a downside target at 1.2700. Cocoa appreciated 1.6% today but if we do not see a settlement above 2700 next week we would move to the sidelines. Sugar has appreciated 12% in the last three weeks which in our eyes is too much so on signs of an interim top we will be looking for bearish trade entries.

OJ has traded higher 9 out of the last 10 sessions picking up just over 20 cents. Longs have got some premium back but November call option holders will hold into next week looking for a touch more...stay tuned. 30-yr bonds will close on their lows making it three loosing weeks in a row. Clients will be looking for an exit next week on a trade closer to 136'00 in December. Corn and soybeans closed near their highs for the week while wheat traded up today but well off its highs. We still favor buying dips in corn and soybeans expecting further upside. Our first objective has been reached...from here we see March corn at $6.75 and January soybeans at $13.20. Live cattle are approaching their record highs but we still need a break to re-establish longs for new entries. Twp times earlier this year lean hogs failed at these levels...will three times be a charm?

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

Bulls make money on up moves while bears make money on down moves but when market action is sloppy and unpredictable those on the sidelines may have the correct trade on. While they do not make money they do not lose either. Crude failed to break the trend line again today and appears to be closing back under the 40 day MA. We feel an interim top was established in recent sessions and we are looking for a $3-4 break...trade accordingly. Crude likely would have traded lower than it did if it was not for the resilience in the products; RBOB and heating oil are higher seven out of the last eight sessions gaining roughly 12% and 10% respectively. Natural gas is cheap but that alone is not reason to be long. We suggest waiting for a trade over $3.80 in November before gaining bullish exposure as the trend would've changed.

Stocks appear to be running out of gas after the very impressive move we experienced in the last two weeks. At this time we're not advising shorts but we are advising booking profits on any remaining longs. Gold will make a decision as for its next leg in the next few days on a break above $1692 or below $1650. We favor a move to the upside but are likely talking our clients positions as we have been gaining bullish exposure in recent weeks. 3-4% moves are becoming daily occurrences in silver, unfortunately today the direction was lower as most of our clients have bullish exposure. We still have a target of $35/ounce but it looks to be a bumpy ride. Those with a heavy long exposure are advised to hedge with partial shorts or options. The 34 day MA capped any upside in the dollar index today as the momentum could still put pressure on the greenback. We feel the easy money has been made on longs in other crosses so tighten up stops or move to the sidelines . Yen shorts are still on our radar but we've yet to make a move for clients.

OJ, sugar and coffee were all higher by better than 3% today. More upside in sugar and coffee and we will be looking to establish bearish trades for clients. As for OJ on a 3-5% appreciation tomorrow we will likely be exiting clients remaining November call options...stay tuned. If we make a fresh weekly low in 30-yr bonds tomorrow we will be looking for an exit door on clients remaining bearish plays as we think we are close to trend change. In late dealings corn pared its losses to close only 0.50% lower in today's sessions. There may be more downside but we like being long a small position thinking big picture there is more upside potential. We view there to be 40 cents of risk and an approximate 60-80 cents of profit potential...in my opinion. Soybean futures have advanced nearly $1 in the last four sessions and bulls appear to be in the driver's seat. Our targets in the January contract is as follows: 12.80, 13.15, 13.50. The window to buy live cattle on a dip may be narrowing but we would just soon miss the trade than buy at these elevated prices. The 20 day MA continues to act as the pivot point. Trade accordingly as that level is 120.50 in December and 122.60 in February.

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

It is important when initiating trades to have targets. You will notice that we try to give price objectives when establishing long and short positions for our clients in most trades. After five positive sessions Crude looks like we will see a negative close with prices settling just above the 40 day MA. Taking a look at a longer term daily chart prices are bumping up against a trend line that has capped rallies since the highs in April when Crude was near $115/barrel. Aggressive traders can scale into longs expecting a $3-4 retracement. Natural gas lost 3.5% today and is now approaching the recent lows on the cusp of making new contract lows. Once again until we see a trade above $3.85 in November refrain from picking a bottom...this market remain a dog with fleas.

With the 1-1.5% advance in indices today we reached our target in the S&P and got within 10 points in Dow futures (see previous posts)...that is good enough for us. We are not suggesting reversing but exit all remaining longs in the indices is my suggestion. Yes an ascending triangle in the making in gold which should mean in the next few sessions we get a breakout before we reach the apex. A trade above $1694; the 50% Fibonacci level should be followed by $1744 the 38.2% level. Silver picked up nearly 2% briefly peeking its head above $33/ounce. Most clients have long exposure with a target of $35/ounce. The dollar has closed lower six out of the last seven sessions and is approaching the 50% Fibonacci levels mentioned at 77.00 in recent posts. The Loonie is fast approaching our par target even quicker than we anticipated. Tighten stops in this trade as we may get cross currents as we think metals are supportive but we expect a trade lower in energies...trade accordingly.

Aggressive traders can fade rallies in the Yen. In the coming days we will likely be establishing bearish plays in the Yen...stay tuned. Continue to buy dips in cocoa. OJ settled back above the 50 day AM for the first time since the first week of August. November longs are fighting back from the dead. We need further help from "Mr. Market" but clients have a chance. A trade closer to $1.70 should be used to offset remaining longs. 1-2 more basis points might be all we get lower in 30-yr bonds on this leg. If given the chance this week we would exit our clients bearish trades. The USDA report today proved to be bearish to wheat, neutral to corn and bullish soybeans and the markets traded accordingly. Corn was slightly lower, soybeans slightly higher and wheat gave up 5%. Some clients remain lightly long corn and soybeans expecting further appreciation in the coming weeks. Clients wait on the sidelines looking for a lower long entry in 2012 live cattle contracts.

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

Large swings continue and are likely here to stay so be willing to endure larger swings when trading or be willing not to trade. Those are your options as I see it. We are seeing swings in a number of markets in a few days time which in years past took several weeks or in some instances months so be careful. Crude's gains today were minimal but today marks the fifth consecutive session where Crude has gained over $10/barrel in that time frame. We expect higher pricing in the medium to longer term but we're anticipating some back and fill action in the short term. That being said longs should tighten stops and aggressive traders can start scaling into shorts looking for $5-7 break. RBOB continues to gain on heating oil for now expect that to continue. The front month of natural gas was higher by nearly 2% today lifting prices back over the 9 day MA. It would take a trade over $3.85 in November to get us interested in new longs but those long can use a rally to get back some value on previous purchased longs from higher levels.

Indices inched higher today after yesterday solid advance. We expect more upside; a 50% Fibonacci retracement lifts the S&P to 1215 and the Dow to 11570. Gold continues to have trouble breaking out of its recent range but on a trade above the 20 day MA at $1692 look for increased buying which should lifts prices back above $1725. Like gold silver is bumping against upside resistance near its highs the last two weeks. In the coming days we expect prices above $33/ounce and on their way to $35...trade accordingly. The 20 day MA in the dollar which had previously served as support should act as resistance at 78.45. We see prices drifting below 77.00 on this leg. The Loonie remains our favorite long candidate as we see prices above par in the coming weeks.

Cocoa prices lost 2% today unable to hold onto the 2700 level. We still feel bullish exposure is the play here though some wind was taken from our sails today. On a settlement above 2700 prices should find their way north of 2800 soon thereafter. OJ picked up 3% today and on its highs prices were 6% higher. Use further appreciation this week to trade out of remaining November longs. On higher trade in equities and commodities we should see further downside in Treasuries. We are not recommended fresh shorts but rather on a lower trade use that as your window to exit bearish positions. Some of our clients have bearish option trades in 30-yr bonds and are currently carrying a loss.

Grains were up big ahead of tomorrow's USDA report with corn higher by 6.5%, soybeans just shy of 5% and wheat 8%. We have and continue to suggest long exposure in this complex. Our favored play are bullish plays in March 2012 corn and January 2012 soybeans. When live cattle break the 20 day MA we should see further downside that would enable long entries at lower than current level. That pivot point in December is 120.35 and 122.50 in the February contract.

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 fact that we did not have a dire jobs number influenced markets today. We continue to think money goes back into commodities and stocks in the weeks to come...trade accordingly. Crude continues to bump up against resistance at the 50% Fibonacci level and as of this post is in the middle or today's range at the 18 day MA. WE may hit our $84/85 objective but we think the likely scenario is back and fill first. We expect to see a trade under $80/barrel before we see much higher ground. Natural gas gave up 3% today dragging prices to new lows. Use any rally to exit longs and do not establish fresh entries until we penetrate the down sloping trend line. In November that is roughly 40 cents from the current price.

Stocks took a breather today unable to penetrate the 50 day MA; in the Dow at 11150 and 1170 in the S&P. We expect further upside in the coming weeks lifting the Dow near 11500 and the S&P to 1200. Do I believe today's NFP...not really but from the outside the number was a lot better than the market was anticipating and unemployment remained at the same level so for now we dodged a bullet. As I said I think the number is false but I learned a long time ago my opinion does not matter it and that the market is always right. The dollar pared its losses today bouncing off the 20 day MA. The good news we hit our target for shorts but we do not like the buying that came in. We will need to break the 20 day MA in the buck back next week to move lower...that level is 78.45 in December. Tighten up stops on any longs in other crosses as the easy money has been made.

If the dollar breaks we feel the Pound and Loonie are the best long candidates. Cocoa made a higher high but failed to hold onto its gains. On the week we were able to close positive for the first time in six weeks. Some clients remain long March with a target at the 50 day MA. We continue to like selling rallies in sugar and coffee but at this point we need to see more upside. In sugar a sale closer to 27 cents and coffee near $2.45. 10-yr notes hit their lowest price level in nearly one month and 30-yr bonds closed lower for their second consecutive week...a feat that had not happened since May. Use further selling to exit remaining bearish trades in 30-yr bonds.

With the exception to soybean meal and oil grains closed lower to end the week. We continue to like scaling into soybeans and corn at these levels. Start small and add to the trade once the market proves you right. Live cattle finished lower three out of five sessions this week but we need more downside to re-establish longs for clients in 2012 contracts.

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

Investor appetite for risk has increased as money is flowing back into securities and commodities. Crude has advanced $7.50 off its lows from Tuesday so clearly there is buying interest but we would like to see the ascent slow or even a re-test of the 9 day MA to feel confident a further move is sustainable. That level comes in at $80.50 in November. If we get a slight retracement we would continue to buy dips with an upside target of $84/85 into next week. Heating oil and RBOB have likely survived there worse and should be heading north once again. Hedgers should have some coverage in both distillates to protect from upward price surges. We feel there is more of a risk of higher prices than lower in the immediate future. One of my clients brought to my attention a new double long natural gas etf (BOIL) was launched today but it appeared to have little effect on the underlying commodity itself. We are optimistic longer term in natural gas but as we said yesterday before gaining fresh exposure we would like to see a settlement above the down sloping trend line that has capped all rallies since June.

Indices penetrated the trend line that has existed since the first week of September settling just above the 20 day MA. We see more upside, a trading range will likely continue until we get new developments domestically and abroad. The idea of kicking the can down the road has stocks investors confused and the markets sideways...trade accordingly. A trade through $1600 tomorrow should get gold back above $1700 in the next few sessions. We've suggested for clients to purchase February 2012 bull calls spreads thinking we see a re-visit of the record highs within that time frame. Silver picked up nearly 6% today and appears on the verge of breaking out the upside. We see $33.50 followed by $35/ounce in the near future and have been suggesting long exposure for aggressive clients. There are various options and future strategies to get bullish so do not hesitate to reach out for suggestions depending on your capital size and risk tolerance.

Day three of the dollar retracement losing .45% as of this post. Our target remains the 20 day MA and then we will re-evaluate how the market reacts at that level; in December at 78.40. With commodities strengthening the commodity currencies should benefit the most in the short term. Our favored play is bullish exposure in the Loonie looking for par. A bullish engulfing candle and spike in volume may have signaled a bottom in cocoa....stay tuned. We like long exposure in March with the 50 day MA as your target. On a 5-8% appreciation in OJ look to exit remaining longs...at a profit or loss. Treasuries are down today ahead of tomorrow's jobs number with 30-yr bonds closing at the 20 day MA and 10-yr notes just under that pivot point. Further weakness will be used to exit clients open shorts in 30-yr bonds. The only viable play we see in this complex is playing the short end of the curve through long dated bearish exposure in 2012 and 2013 Euro-dollars.

Wheat was slightly lower in today's' trade while corn and soybeans were unchanged after giving back their gains overnight. Back off any wheat purchases but continue to scale into longs in corn and soybeans. Our suggested play is long futures and selling out of the money calls 1:1. Our target in March corn is $6.60 and our target in January soybeans is $12.75. Clients are still waiting for a break to get long 2012 live cattle contracts. We will likely start gaining bullish exposure in February for clients closer to $1.21.

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

We expect to see further appreciation in stocks and select commodities in the immediate future. That being said we see money coming out of safe havens ( dollars and Treasuries) and back to risk assets at least for a few weeks. It is about time some appreciation...Crude is higher as of this post by just better than 5% getting back the two previous day's losses. Staying long has been a real challenging trade but we may come out of this ok as clients have lifted their hedges and remain long. A settlement above the 9 day MA at $80 in November should accelerate a move north. On that we should see $84/85 into next week. Assuming our assessment is correct in Crude the distillates should see a 15 cent appreciation as well. Use rallies in natural gas to exit longs...this market is a dog! Until we see the down sloping trend line penetrated we do not have interest in having long exposure. That would mean November futures trade over $3.90.

The indices are higher by 2-3% today and as of this post both the Dow and S&P appear to be closing at their 9 day MA's. It may take a few weeks but we think the trading range continues that lifts the Dow back above 11400 and the S&P to 1200...trade accordingly. Gold passed the test again today with the trend line acting as solid support. We also had a settlement above the 9 day MA for the first time in four weeks. Aggressive traders wade back long lightly but we would feel better on a trade above $1680 in December to confirm the wash out is compete. Lows were rejected in silver overnight as the white metal managed to gain just better than 2% today. On a trade above the 9 day MA at $30.40 we have preliminary signs of a recovery. We are long from higher levels with a number of clients but feel we see $35 in the coming weeks so have held on...trade accordingly.

The dollar finished lower for the second day in a row...a feat that had not been accomplished in three weeks. As goes the dollar we see a pop in other crosses with the commodity currencies benefiting the most (Aussie, Kiwi and Loonie). Our favored play is longs in the Loonie expecting a trade back to par in the coming weeks. Cocoa picked up again today gaining just over 1%. It is an uphill battle as most clients are long from higher levels but 2900-3000 should be obtainable on further dollar deterioration. Treasuries got hit today but echoing recent blogs we suggest using any down action to exit open bearish trades and wish not to establish fresh shorts with clients. We view our exit window in 30-yr bonds at 139-140'00.

Ag's are cheap and bargain hunters should be buying wheat, corn and soybeans up at these devalued levels. Just in the last month soybeans have faltered nearly 20% and corn was 35% off its highs...we do not think these levels will last. Not to mention FC Stone and Informa have reported potentially smaller crops and lower yields. China should come back from vacation next week as a grain buyer as well. A jump in exports would be supportive. Our favored plays are in corn and soybeans, long futures and selling out of the money calls 1:1. We are still looking for a further dip in live cattle to establish bullish plays in 2012 contracts for clients...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.

Money flows out of safe havens and back into risk assets. Far from a victory but this could be the beginning of what I've been calling for in recent weeks. We've had a rough go of it being we've been buying on the way down for clients but if we start to recover from here their positions could be back in the green by next week. We had reached almost our maximum risk tolerance so it is fitting that we get a bounce almost commodity wide. New lows were lows, rejected in Crude but we will need to hold the current levels because there is not much technical support underneath. Clients hold longs in oil from higher levels but have been advised to lift their hedges and to put stops under today's lows. We will not buy more natural gas until a lows is established and if further appreciation is met with selling look to exit open positions.

Stocks pared losses finishing the day strong as in early dealings it appeared we would violate the lows from August 9th which would have been very bad. We should see a trade back to 1200 in the S&P but we will be on the sidelines as we do not like trading this instrument with the wild swings we are seeing. Gold will close down roughly $35/ounce today but I like the late action that we were able to hold the trend line on another test. $1590-1600 must hold in December and if it does the next few days we would say the washout is over and traders can get positioned long once again. Likewise silver will finish lower but well off its lows as of this post futures have rallied back above $30/ounce. Aggressive traders can buy dips as we still think a $34/35 trade will be seen in the coming weeks. A settlement above the 9 day MA at $31.10 would be a first indication that sellers are absent.

The dollar is exhibiting signs of an interim top and we are operating under the influence that we are long overdue for a retracement. That being said buys in the Loonie, Swiss and Pound are on our radar but we have not opened new longs YET. Those that were in call spreads in currencies were advised to buy back their top legs today if in December contracts. We continue to think cocoa is one of the most undervalued commodities around these levels...trade accordingly. If risk assets catch a bid look for Treasuries to come off. We would use a sell off to exit open short positions for clients and are not advising fresh entries as this trade has been too frustrating in recent weeks/months.

Those brave enough and looking for a trade that may take a few months to play out are advised to buy new crop corn and soybeans. Our suggestion is long futures and selling out of the money calls 1:1. We are looking for a break in live cattle to gain long exposure and the market has started to cooperate. Live cattle gave up 1.25% today...on another 1.5-2.5% deprecation we will be looking to gain bullish exposure in 2012 contracts...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.

Money is fleeing risk assets, i.e. commodities and stocks and finding its way to Treasuries and the US dollar. Our take is some type of intervention or plan will halt further appreciation in Treasuries and the dollar and prevent a complete price collapse in the stock and commodity markets...stay tuned. Oil is approaching its lows hit in August down by 2.6% as of this post. We have advised clients to buy trades below $80 so they have started to scale into longs in recent session but if we see a new settlement low we may advise them to cut losses on longs...stay tuned. We have opted for no new fresh entries in natural gas for clients and will be using any jump in price as exit opportunities for open longs. Prices appear to be cheap but they keep getting cheaper.

Stocks start the week with a bang 3-6%. December S&P futures will close below 1100 for the first time this year as slow manufacturing and the mess in Europe has BEARS in the driver's seat. We see no ending in sight in the stock market as we expect new lows to follow...trade accordingly. Gold pushed higher by 2% today trading up to the 9 day MA. On a settlement above $1665 in December expect $1700 followed by $1740. The fact that gold was able to gain in the face of a rising dollar bodes well for continued upside. Silver closed well off its highs but still was able to appreciate .85% today. We think this consolidation is the market catching a breath before an upside assault as we are looking for December futures to find their way back above $35/ounce in the coming weeks. Copper traded below $3.00 for the first time in fifteen months. Though it would be catching a falling knife much like oil below $80 we feel aggressive traders could scale into longs in copper below $3.00.

As of this post the dollar index is higher by 1.25% lifting price to fresh 2011 highs. We do not expect a trade above 80.00 to be sustainable but recognize if the dollar move north continues we are losing on most of our commodity longs because the inverse relationship. Until the dollar stops appreciating all the other crosses with the exception of the Yen are in sell mode. Cocoa is one of the most heavily correlated commodities with the dollar so if the dollar continues north cocoa could have trouble appreciating. We are long cocoa with most clients via March options and are currently under water. Outside of the greenback Treasuries also served as a flight to quality today with 10-yr notes and 30-yr bonds up appreciably approaching their contract highs. This trade makes little sense to me but the market is always right and looks to be headed for higher ground...trade accordingly.

Mixed bag in grains with corn unchanged, soybeans slightly lower and wheat moderately higher. We've suggested scaling into longs in corn and soybeans to clients as the recent route we feel has over shot to the downside. We suspect corn prices under $6/bushel to be very temporary. As for soybeans after a 20% reduction in prices in the last month expect countries who buy US soybeans to step up their purchases. Live cattle prices continue to surge higher as they've appreciated now for seven straight sessions. We do expect record highs and a correction may not be as deep as previously forecast. New entries may need to pay up but still should wait for a 2.5-4% correction.

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