Fresh Start/ Q2 Tomorrow 3/31/11

Crude advanced to a two week high today with May settling back above $107/barrel. We should see new contract highs into next week…trade accordingly. Natural gas closed less than 1% higher today but well off its lows forming a bullish engulfing candle on the daily chart. We have started pricing out June and July bullish options strategies; look for trade ideas into next week. I said I would not do it but I changed my mind…aggressive clients started buying bearish options trades in the ES today looking for a retracement back to 1285 in the June contract in the coming weeks. The Australian dollar has appreciated 7% and closed higher the last eleven sessions…enough is enough. We advised clients to start scaling into bearish plays today looking for June to trade back to the 20 day MA near par in the coming weeks. We also advised clients to take a small loss on their Euro shorts. We will need to see a healthy retracement in live cattle before getting long again…remain on the sidelines for now. Aggressive traders could get short lean hogs with tight stops. Gold and silver are back near their respective contract highs…we suggest the sidelines or shorts in gold. We continue to like picking up cocoa longs at these levels thinking we are due for a bounce. A bullish planting intentions report as Ag was the complex to be in today…corn higher by nearly 5%, soybeans 3% ad wheat 5%. If trading in this arena be long as we continue to think new crop corn and soybeans are the best place to be. Risk disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.

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