Pfgbestdirect.net Upcoming Notice Dates
Monday, November 17

FN: NOV Lumber
LT: NOV US T-Bill, LIBOR, GSCI, Eurodollar
LTO: NOV LIBOR / DEC Sugar, Crude Oil

Tuesday, November 18

FN: DEC Coffee

Wednesday, November 19

LTO: DEC Platinum

Thursday, November 20

FN: DEC Cotton
LT: NOV Feeder Cattle / DEC Crude Oil
LTO: NOV Feeder Cattle / DEC Silver, Gold, Copper

Friday, November 21

LTO: NOV Valueline, DJIA, E-mini S&P, NASDAQ 100, S&P 500, Nikkei 225 / DEC Wheat, OJ, Heating Oil, Natural Gas, RBOB, US Bonds, Corn, Oats, Rough Rice, Soybeans

FN- FIRST NOTICE DAY
LT - LAST TRADING DAY
LTO - LAST TRADING DAY FOR OPTIONS

In looking at the markets I have a good conviction on where the markets may trade over the course of the next 4 weeks.

The 30yr US T-Bond has been showing that the bond market is currently in demand. We are poised (see chart below) to break out of a W pattern and test the 123 124 range. Current Global uncertainty and the belief that the U.S. will come out of this Global Meltdown before Europe or most of Asia has been leading to a sustained purchase of US Bonds and Notes.  With most of the bullets used by Global governments to contain the fall of world stock markets we now must face at last a reckoning of sorts that will push stocks to new lows. The stock markets need to find a level that people will feel confident in placing some of their uninvested capital and I do not think this is that level.  I am looking for the SP 500 to move towards the 700 level

As always these views are as of the time writing this and that unforseen events can change this viewpoint.  There is always a risk of lo

Forex Currency News and Research

November 7 , 2008
Japanese Yen Currency should Remain Strong

Former BoJ official Eisuke Sakakibara was quoted as saying " I still believe a strong yen is in the national interest of Japan, particularly in this situation when raw material prices will increase"

The Yen has been the strongest Currency this year even gaining 15% against the US Dollar and well over 30% against the euro.

There is a view that the Long Term view is for the Yen to move to 80 Yen per Dollar.

Brother Can you spare a Trillion??

The Bank of England today stated that the market mayhem of this fall has left the world's financial institutions nursing losses of $2.8 trillion Dollars.

The BOE has called for a fundamental reform of the global banking system to prevent a repeat of the turmoil that has not been since since the outbreak of the first world war.

Possible S&P 500 Futures scenarios

Please see the chart

Novewmber Soybeans are trading up sharply higher.

US Export sales have increased sharply over the last few weeks.  The major factor has been lower grain prices. Lower shipping costs and the steadily increasing dollar forcing buyers to lock in prices now rather than having to pay later.

Commitment of Traders Report for the week ending October 14th, it showed liquidation by index funds in all 12 of the commodities where index fund activity is broken out. In soybeans, index funds were net sellers of 5,380 contracts while trend-following funds were net sellers of 9,966 and this has dropped the latter's net long position to just 5,908 contracts. Index funds still hold a net long position of 110,440 contracts. Small traders were moderate net buyers. In oil, index funds were net sellers of 3,263 to reduce their net long position to 62,553 contracts. Trend followers were net sellers of 3,043 contracts in oil to increase their net short position to 11,782. In meal, large non-commercial traders were net sellers of nearly 14,000 contracts to switch their overall net position to short by 4,498 contracts.

 The USDA will release its crop progress reports in the afternoon.

Bottom Line is we expect the grain complex as a whole to continue to trade sideways to slightly lower as we continue to finish up harvest.

Crude Oil Futures Drops Below $75 a barrel

The oil market has come under significant pressure as expectations for demand continue to constrict due to the current global slowdown.  This is more of a Global Recession and prices are reflecting this in Crude as well as shipping rates and other factors that tie into the Global Economy.

OPEC has cut its 2009 demand forecast for a second straight month because of dramatically worsening conditions.

OPEC’s forecast reduced oil demand forecasts 450,000 barrels a day to 87.21 million barrels a day.

Tomorrow, Thursday October 16, 20008 The US Government will release reports on Crude oil and gasoline inventories.  Expectations are for inventories to increase.

October 13, 2008
Coordinated efforts across the globe have the US Dollar retreating as money is being put into Global Markets again.

The real test remains to be seen after this initial pulse up where we close on the week for all currencies.

We still are maintaining our big picture Long Term Bullish Dollar bias, but would suggest looking at weekly resistance levels to add positions that the Dollar is the quote and suppport levels where the dollar is the base.

Apparently the markets cannot find a way to correct the downward trend that the DOW, NASDAQ, S&P have been following for the past few days. As much as they try to find a support level, there seems to be none in sight. Then you have Crude Oil will continue to test support under $80.00 a barrel. Then you have U.S. Bonds lower for the day from the open.  And last but not least we have Gold that continues to struggle to break above 950.00...

With all this said, how does it affect the Forex Spot Market.   

The USD will continue to strengthen further against the EUR, GBP, AUD,NZD, CAD. 

The JPY will continue to strengthen against the GBP, EUR, AUD, NZD, USD.

Remember that the past few days I have stated that the JPY pairs continue to have a strong correlation with the DOW, NASDAQ, and S&P. 

The USD pairs have had strong correlation with Crude Oil and seing that Crude Oil is trading under $90.00 a Barrel. The USD will continue to strengthen accross the board.

Don't be distracted by small retracements when in fact the Central Banks still have not been able to implement the right monetary policy to stop the fear of short selling in the Global markets. 

Have a good weekend and best regards.

Ricardo  Menjivar

All there is to say at this point is WOW!

The Forex Market has made history with the the 300 to 500 pip swing trades that we have seen these past few days. The next question is what will the market do next? The answer is that the U.S. Dollar will continue to get stronger this day against the GBP, EUR, AUS, NZD. Don't be fooled with the  market correction and retracements we have seen earlier this day with the DOW, NASDAQ, S&P recovering some losses from yesterday.The momentum for the US Dollar is still correlated to Crude Oil not to the indexes. As Crude Oil continues to drop in price the U.S. Dollar will continue to strengthen. This recession that is projecting itself more and more in the global markets will make the Oil producers bring the price down to accomadate the credit crunch that is facing main street.   

In reference to the JPY we haven't seen the end of it's strong recovery against  USD, GBP, EUR, AUD, CHF,  or the NZD. The JPY pairs mentioned here have had its strongest correlation to the DOW, NASDAQ, and S&P. Based on the bad news that we continue to come accross with the U.S. markets this momentum favoring the JPY will continue so don't be fooled with retracements or partial corrections in these pairs. We have yet to see the end of this trend. 

The only change we can expect is that the Central Banks inject more liquidity in the markets and even then run the risk that it isn't enough to bring back the confidence that is required to turn these markets around. 

To all you traders out there. I wish you the best of luck and hope this commentary brings more clarity to your decisions on this day.

Greetings from your Futures & Forex Broker at PFGBEST.com

Ricardo Menjivar