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John Carter Analysis: Update on Currencies, Bonds, and Commodities

Today's Hot Topic opens the week with a review of currencies, some of the most important signals in bonds and notes and getting into crude, metals and grains.

In today's Premium Futures Update, we're starting with a look at the Euro which is showing some signs of stabilization. Concurrently, the dollar is certainly stretched out, although it has a longer term "magnet" resistance level at slightly higher price levels around 89-90. The Yen has fallen 900 ticks and has not seen a decent day up in a while. We are due for a rally in the Yen, but have not seen any signs as of yet. The Australian dollar, which is highly correlated to commodities, has also not acted very constructively. The Canadian dollar is looking similar. The British Pound is exceedling weak, both against the Euro and the Dollar. The Bond market is one of the more interesting areas to focus on, as the short-term consolidation appears complete and a weekly squeeze is due to unfold. Gold and silver had a fantastic day on Friday, but they still look like shorting opportunities to me. I would look to go short on rallies but advise caution as they can pick up steam if the reversal has legs. Crude oil appears to have paused around 75, and I anticipate it dropping to the 60 area. Natural gas is trading separately from crude, and should respond to supply and demand. The grains have had some nice moves the last few weeks and are setting up for longs on pull-backs. Live cattle continues to defy everyone's expectations and should be going higher. Finally, coffee has been consolidating but is worth keeping an eye on as an indicator for SBUX and DNKN.

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