Bombing Worries Market; Waiting for Decisive Market Action
T-bond futures
June T-bonds [USM9>USM9] gave back earlier gains as investors and traders sold their longs before the weekend. The NATO attack has the market concerned despite positive remarks by one of the Fed Governors on interest rates yesterday.
The release of the University of Michigan Sentiment Index also helped the bonds rally earlier in the day. Short-term, we’re flat. Long-term, we still hold our short position in the June contract.
Currency futures
The June Swiss franc [SFM9>SFM9] and the Euro were weaker today as tensions mount in Eastern Europe. Any instability is a negative for European currencies and bullish for the U.S. dollar.
Short-term, we went long the Swiss franc on the close with a stop
in at the .6750 level, as we suspect fears are overblown; we’re looking for a rally early next week. We traded only half our normal position size because
of the chance of a sudden volatility increase. However, any
downside move would offer another short-term buy opportunity.
Longer-term, we still hold our short positions in the June D-mark [DMM9>DMM9] and Swiss franc.
S&P 500 futures
We were looking to sell a rally in the June S&P [SPM9>SPM9] today but never got the chance. The market has been very volatile lately (again, because of the NATO situation), but it has not given us any low-risk entry points.
Next scheduled update: Monday, March 29, 1999
(Check “Today’s Schedule” every day on our home page to find out about additional updates.)