Jobs Data Lifts Market

BOND MARKET RECAP

3/4/2005

March Bonds finished up 1-00 at 113-22, 0-06 off
the high and 1-15 up from the low.

March 10 Yr Treasury Notes finished up 0-130 at
111-030, 0-030 off the high and 0-190 up from the low.

With the ISM non-Manufacturing index’s
employment component showing a jump to the highest level since the index was
created, traders were looking for a Feb payroll number closer to +300,000. Since
the Feb payroll data actually came in +262,000 the number was a bit
disappointing while the unemployment rate rose to 5.4% which was a surprise.
Bond prices firmed in reaction to the report as both the hourly earnings and
work week components were left unchanged from January. This suggest a lack of
price pressures in the economy and cooled traders concerns that the Fed would
have to take a more aggressive approach to raising rates. The U of M Consumer
Sentiment for Feb came in at 94.1 vs 95.5 in Jan while Jan Factory Orders were
+.2% and Jan Durable Goods were revised down to -1.3%. These softer numbers
further supported short covering in the bond market.

Technical Outlook

BONDS (MAR) 03/07/2005: The cross over and close
above the 60-day moving average is an indication the longer-term trend has
turned positive. The daily stochastics gave a bullish indicator with a crossover
up. Daily momentum studies are on the rise from low levels and should accelerate
a move higher on a push through the 1st swing resistance. The major trend has
turned down with the cross over back below the 18-day moving average. The
outside day up is a positive signal. The market has a bullish tilt coming into
today’s trade with the close above the 2nd swing resistance. The next upside
target is 115-04. The next area of resistance is around 114-18 and 115-04, while
1st support hits today at 112-24 and below there at 111-15.

TNOTES (MAR) 03/07/2005: The crossover up in the
daily stochastics is a bullish signal. Daily stochastics are showing positive
momentum from oversold levels, which should reinforce a move higher if near term
resistance is taken out. The major trend has turned down with the cross over
back below the 18-day moving average. A positive signal was given by the outside
day up. The market has a bullish tilt coming into today’s trade with the close
above the 2nd swing resistance. The near-term upside objective is at 111-215.
The next area of resistance is around 111-135 and 111-215, while 1st support
hits today at 110-225 and below there at 110-070.
 

STOCK INDICES RECAP

3/4/2005

March S&P finished up 14.4 at 1224.3, 1.2 off the high and 9.2
up from the low.

March S&P E-Mini closed up 14.25 at 1224.25. This was 15 up
from the low and 1.5 off the high.

March Dow closed up 130 at 10956. This was 116 up from the low
and 9 off the high.

The S&P market closed sharply higher Friday as
the February employment data was nearly all bullish for the stock market as
payroll rose 262,000, the hourly earnings and work week components were left
unchanged from January which suggests a lack of price pressures in the economy.
This has tempered traders concerns that the Fed would have to take a more
aggressive approach to raising rates. The market seemed to discount the surprise
rise in the unemployment rate to 5.4%. Profit taking in the energy sector also
provided support to stocks. With jobs showing solid growth, the economy seems to
be in a much better position to absorb higher energy costs which is providing a
bullish outlook for stocks.

Technical Outlook

S&P 500 (MAR) 03/07/2005: A new contract high was
made on the rally. The upside crossover (9 above 18) of the moving averages
suggests a developing short-term uptrend. Rising stochastics at overbought
levels warrant some caution for bulls. The cross over and close above the 18-day
moving average indicates the longer-term trend has turned up. Since the close
was above the 2nd swing resistance number, the market’s posture is bullish and
could see more upside follow-through early in the session. The near-term upside
target is at 1232.70. The next area of resistance is around 1229.50 and 1232.70,
while 1st support hits today at 1219.10 and below there at 1211.90.

SP EMINI (MAR) 03/07/2005: The market made a new
contract high on the rally. The upside crossover (9 above 18) of the moving
averages suggests a developing short-term uptrend. Momentum studies are trending
higher but have entered overbought levels. The major trend could be turning up
with the close back above the 18-day moving average. The market’s close above
the 2nd swing resistance number is a bullish indication. The next upside
objective is 1237.37. The next area of resistance is around 1232.50 and 1237.37,
while 1st support hits today at 1216.00 and below there at 1204.38.

NASDAQ (MAR) 03/07/2005: The crossover up in the
daily stochastics is a bullish signal. Stochastics are at mid-range but trending
higher, which should reinforce a move higher if resistance levels are taken out.
The major trend could be turning up with the close back above the 18-day moving
average. The close over the pivot swing is a somewhat positive setup. The
near-term upside target is at 1539.50. The next area of resistance is around
1532.00 and 1539.50, while 1st support hits today at 1518.00 and below there at
1511.50.
 

CURRENCY MARKET RECAP

3/4/2005

March US Dollar finished down 78 at 8253, 87 off the high and
10 up from the low.

March Euro finished up 1.28 at 132.4, 0.17 off the high and
1.5 up from the low.

March Euro Dollar closed up 0.01 at 97.0025. This was 0.01 up
from the low and 0.005 off the high.

March Canadian Dollar closed up 0.79 at 81.25. This was 0.91
up from the low and 0.12 off the high.

March British Pound finished up 1.67 at 192.3, 0.32 off the
high and 2 up from the low.

March Swiss closed up 0.85 at 85.59. This was 1.19 up from the
low and 0.15 off the high.

March Japanese Yen closed up 0.54 at 95.59. This was 0.84 up
from the low and 0.31 off the high.

After seeing the ISM non-Manufacturing index’s
employment component jump to the highest level since the index was created,
currency traders were expecting a gain in payroll closer to +300,000. Since the
Feb payroll data actually came in +262,000 the number was a bit disappointing
while the unemployment rate rose to 5.4% which was a surprise. Since the Dollar
had been able to gain ground for most of the week to correct enough of the
market’s over sold position, the disappointing payroll report started a new wave
of Dollar selling.

Technical Outlook

YEN (MAR) 03/07/2005: Negative momentum studies
in the neutral zone will tend to reinforce lower price action. The market now
above the 18-day moving average suggests the longer-term trend has turned up.
The outside day up is somewhat positive. With the close over the 1st swing
resistance number, the market is in a moderately positive position. The next
downside objective is now at 94.31. The next area of resistance is around 96.16
and 96.60, while 1st support hits today at 95.02 and below there at 94.31.

EURO (MAR) 03/07/2005: The market now above the
60-day moving average suggests the longer-term trend has turned up. Daily
stochastics turning lower from overbought levels is bearish and will tend to
reinforce a downside break especially if near term support is penetrated. The
cross over and close above the 18-day moving average is an indication the
longer-term trend has turned positive. The outside day up is somewhat positive.
The market has a bullish tilt coming into today’s trade with the close above the
2nd swing resistance. The next downside target is 130.40. The next area of
resistance is around 133.23 and 133.73, while 1st support hits today at 131.57
and below there at 130.40.
 

PRECIOUS METALS RECAP

3/4/2005

April Gold closed up 4.3 at 435.1. This was 4.6 up from the
low and 1.2 off the high.

March Silver finished up 0.12 at 7.349, 0.041 off the high and
0.149 up from the low.

Gold and silver rallied today after the dollar
broke hard on this morning’s payrolls report that turned out to be a
disappointment to some. The report showed a net gain of 262,000 jobs in
February, which would appear to be strong given the trade estimates of 220,000
that had been talked about earlier in the week. However, but by the time the
number was released, some traders were expecting as much as a 400,000-job gain.
The unemployment rate climbed to 5.4% from 5.2%, which may also have tempered
the otherwise strong jobs number. Palladium was up sharply for the second day in
a row as it has apparently become the latest commodity to be discovered by the
funds.

Technical Outlook

SILVER (MAY) 03/07/2005: Momentum studies
trending lower at mid-range should accelerate a move lower if support levels are
taken out. The cross over and close above the 18-day moving average is an
indication the longer-term trend has turned positive. A positive signal was
given by the outside day up. The market has a bullish tilt coming into today’s
trade with the close above the 2nd swing resistance. The next downside objective
is 710.4. The next area of resistance is around 750.8 and 759.4, while 1st
support hits today at 726.3 and below there at 710.4.

GOLD (APR) 03/07/2005: The major trend could be
turning up with the close back above the 60-day moving average. Stochastics
turning bearish at overbought levels will tend to support lower prices if
support levels are broken. The cross over and close above the 18-day moving
average indicates the longer-term trend has turned up. The market setup is
supportive for early gains with the close over the 1st swing resistance. The
next downside objective is 428.5. The next area of resistance is around 438.0
and 440.0, while 1st support hits today at 432.2 and below there at 428.5.
 

COPPER MARKET RECAP

3/4/2005

March Copper closed up 1.70 at 149.20. This was 0.60 up from
the low and 1.00 off the high.

May copper traded to new contract highs today on
the back of a lower dollar. The dollar broke this morning after the release of
the February non-farm payrolls data, which showed a net gain of 262,000 jobs on
the month. While this number looked strong at first glance, coming in clearly
higher than the 222,000 that had been the popular consensus, by the time the
number was released, expectations had soared to 400,000! May copper traded to a
new high of 150.70 early in the session, besting its previous high at 150.30 set
on Tuesday. The close at 149.40, while still 1.80 better on the day, was 1.30
off the highs and below the psychological resistance level of 150.00.
 

ENERGY MARKET RECAP

3/4/2005

April Crude Oil closed up 0.21 at 53.78. This was 0.88 up from
the low and 0.22 off the high.

April Heating Oil closed down 0.74 at 148.34. This was 1.34 up
from the low and 1.26 off the high.

April Unleaded Gas finished up 0.14 at 150.89, 1.01 off the
high and 1.89 up from the low.

April Natural Gas finished up 0.09 at 6.74, 0.04 off the high
and 0.16 up from the low.

April Propane closed unchanged at 0.82. This was equal to the
low and equal to the high.

OPEC leadership attempted to relieve the market’s
concern for tightening oil supplies by pledging not to cut production targets at
this month’s meeting and to supply more oil to the market if the need arises.
However, these statements are a bit shallow and will not likely cool the
volatility seen in the energy complex this week. Private forecasters have
estimated OPEC to be producing about 2 million barrels over quota with only 1
mil to 1.5 million barrels/day left of excess capacity. Therefore, the cartel is
limited to the amount of extra crude oil it can supply to the marketplace.

Technical Outlook

CRUDE OIL (APR) 03/07/2005: Momentum studies are
trending lower from high levels which should accelerate a move lower on a break
below the 1st swing support. The major trend could be turning up with the close
back above the 18-day moving average. It is a slightly negative indicator that
the close was lower than the pivot swing number. The next downside objective is
now at 52.52. The market is approaching overbought levels with an RSI over 70.
The next area of resistance is around 54.33 and 54.71, while 1st support hits
today at 53.23 and below there at 52.52.

UNLEADED (APR) 03/07/2005: Momentum studies are
trending higher but have entered overbought levels. The major trend could be
turning up with the close back above the 18-day moving average. The close over
the pivot swing is a somewhat positive setup. The near-term upside target is at
153.57. With a reading over 70, the 9-day RSI is approaching overbought levels.
The next area of resistance is around 152.34 and 153.57, while 1st support hits
today at 149.44 and below there at 147.77.

HEATING OIL (APR) 03/07/2005: The daily
stochastics have crossed over down which is a bearish indication. Momentum
studies trending lower from overbought levels is a bearish indicator and would
tend to reinforce lower price action. The market now above the 18-day moving
average suggests the longer-term trend has turned up. The market tilt is
slightly negative with the close under the pivot. The next downside target is
now at 145.72. With a reading over 70, the 9-day RSI is approaching overbought
levels. The next area of resistance is around 149.64 and 150.92, while 1st
support hits today at 147.04 and below there at 145.72.
 

CORN MARKET RECAP

3/4/2005

May Corn finished down 1 at 217, 2 1/4 off the high and 1/4 up
from the low. December Corn closed down 1 at 238 1/4. This was 3/4 up from the
low and 1 3/4 off the high.

May corn closed 1 cent lower on the session and 4
1/4 lower on the week. The early rally was based on better than expected export
news overnight and higher soybean values but a turn lower in soybeans helped
pressure corn into the mid-session. Taiwan bought 60,000 tons of US corn
overnight in spite of expectations that Argentina would get the business. Taiwan
also bought 23,000 tons of US corn as part of a corn/soybean combo cargo. South
Korea bought up to 55,000 tonnes of optional origin corn overnight. In addition,
the USDA confirmed a sale of 118,000 tons of US corn to Mexico. Deliveries for
March corn totaled 1,284 contracts with a commercial stopper of 974 of the
total. There was some weakness in the grain markets with word of higher margins
set to take effect next week. Support for May corn comes in at 216 and 213 1/2
with resistance at 219 and 221 1/2.

Technical Outlook

CORN (MAY) 03/07/2005: Momentum studies are
trending lower from high levels which should accelerate a move lower on a break
below the 1st swing support. The market now above the 18-day moving average
suggests the longer-term trend has turned up. The daily closing price reversal
down puts the market on the defensive. The market tilt is slightly negative with
the close under the pivot. The next downside objective is 215. The next area of
resistance is around 218 1/4 and 220, while 1st support hits today at 215 3/4
and below there at 215.
 

SOY COMPLEX RECAP

3/4/2005

May Soybeans finished up 2 1/2 at 629 3/4, 5 1/4
off the high and 4 1/4 up from the low. November Soybeans closed down 1 at 618
3/4. This was 3 1/4 up from the low and 5 1/4 off the high.

May Soymeal closed down 3.1 at 183.8. This was
0.3 up from the low and 4.2 off the high.

March Soybean Oil finished up 0.27 at 23.12, 0.08
off the high and 0.3 up from the low.

Fears of a continued dry trend in Brazil next
week helped the market hold onto gains late in the session. A continued dry
weather trend in Southern Brazil for the weekend, uncertainty over the chances
of rain next week and strong commercial stoppers for delivery helped to support
the early bounce. March soybean deliveries totaled 282 lots this morning and a
strong commercial stopper took 257 of the total which helped provide support.
Rumors of China demand and a firm basis added to the more positive cash tone.
However, commercial firms delivered 625 meal contracts this morning and CBOT
registrations jumped to 699 lots from 76 lots previous helped to pressure the
market. Oil deliveries totaled 326 contracts and palm oil was lower overnight.
The sharp drop in the US dollar helped provide some underlying support. Traders
await a possible impact from the Commitment-of-Traders report for release this
afternoon and the weather forecast for southern Brazil for Monday morning.
Resistance for May soybeans comes in at 632 and 638 with support back at 618 and
610 3/4.

Technical Outlook

BEANS (MAY) 03/07/2005: Momentum studies are
trending higher but have entered overbought levels. The cross over and close
above the 18-day moving average indicates the longer-term trend has turned up.
It is a mildly bullish indicator that the market closed over the pivot swing
number. The next upside objective is 639 1/2. The market is becoming somewhat
overbought now that the RSI is over 70. The next area of resistance is around
634 1/2 and 639 1/2, while 1st support hits today at 625 and below there at 620
1/2.

MEAL (MAY) 03/07/2005: Daily stochastics have
risen into overbought territory which will tend to support reversal action if it
occurs. The market now above the 18-day moving average suggests the longer-term
trend has turned up. The market could take on a defensive posture with the daily
closing price reversal down. The market tilt is slightly negative with the close
under the pivot. The next upside objective is 191.9. The 9-day RSI over 70
indicates the market is approaching overbought levels. The next area of
resistance is around 189.0 and 191.9, while 1st support hits today at 185.0 and
below there at 183.9.

BEANOIL (MAY) 03/07/2005: Momentum studies are
trending higher but have entered overbought levels. The cross over and close
above the 18-day moving average indicates the longer-term trend has turned up.
Market positioning is positive with the close over the 1st swing resistance. The
next upside objective is 23.66. The market is becoming somewhat overbought now
that the RSI is over 70. The next area of resistance is around 23.50 and 23.66,
while 1st support hits today at 23.10 and below there at 22.85.
 

WHEAT MARKET RECAP

3/4/2005

May Wheat finished down 1 at 337, 1 1/2 off the high and 3 up
from the low. July Wheat closed down 1 1/4 at 343 1/2. This was 3 up from the
low and 2 off the high.

May wheat closed 1 cent lower on the session but
3 3/4 higher on the week. Continued talk of good weather conditions for the
winter wheat crop and hefty world wheat supply helped to trigger light
speculative selling and lower trade into mid-session. Fears that Europe will
take over as a prominent exporter over the next several months with a more
aggressive subsidy for exporters this week added to the bearish tone. While the
old crop season export pace remains well ahead of the pace to reach the USDA
export forecast, traders are fearful that new crop exports will struggle as
buyers pick up European wheat. Deliveries were light again this morning at only
13 contracts. May wheat support comes in at 334 and 326 3/4 with 338 3/4 and 344
as resistance.

Technical Outlook

WHEAT (MAY) 03/07/2005: The daily stochastics
gave a bearish indicator with a crossover down. Stochastics turning bearish at
overbought levels will tend to support lower prices if support levels are
broken. The major trend could be turning up with the close back above the 18-day
moving average. It is a slightly negative indicator that the close was under the
swing pivot. The next downside target is 332 1/4. The next area of resistance is
around 339 1/4 and 341, while 1st support hits today at 334 3/4 and below there
at 332 1/4. 

LIVE CATTLE RECAP

3/4/2005

April Live Cattle finished up 0.32 at 89.02, 0.67 off the high
and 0.47 up from the low.

March Feeder Cattle closed up 0.05 at 102.67. This was 0.32 up
from the low and 0.67 off the high.

Follow-through buying from news of no Canadian
cattle next week and from $90 cash trade this week supported the early strength.
With futures at a discount to the cash market ahead of the border opening with
Canada, news that the Canadian cattle will not be allowed into the US on the
March 7th date helped trigger aggressive buying from commercial traders and
speculators. April futures closed 32 higher on the session and up nearly 300
points on the week. Boxed-beef cut-out values at mid-session were up $1.59 to
$143.58 as compared with $139.96 last week. Slaughter came in at 117,000 head
from trade expectations for 116,000-120,000 head.

Technical Outlook

CATTLE (APR) 03/07/2005: Momentum studies are
trending higher from mid-range, which should support a move higher if resistance
levels are penetrated. The cross over and close above the 18-day moving average
indicates the longer-term trend has turned up. The market has a slightly
positive tilt with the close over the swing pivot. The next upside objective is
90.220. The market is becoming somewhat overbought now that the RSI is over 70.
The next area of resistance is around 89.600 and 90.220, while 1st support hits
today at 88.470 and below there at 87.950.
 

LEAN HOGS RECAP

3/4/2005

April Lean Hogs finished down 0.45 at 75.65, 0.80 off the high
and 0.20 up from the low.

March Pork Bellies closed up 0.10 at 88.80. This was 1.05 up
from the low and 0.77 off the high.

April hogs found early support from higher cash
markets (Peoria up $2.00) and from active fund buying but commercial selling
emerged to pressure the market into the afternoon. Ideas that there will be less
beef to compete with pork into the spring and hopes that export demand remains
strong helped support the test of contract highs for June. However, the stiff
premium of futures over the cash market and talk that pork values may slip next
week may have encouraged commercial selling. The 2-day lean index for the period
ending March 2nd came in at 70.27, down.06 on the session but up from 69.75 last
week. Slaughter came in at 370,000 head from trade expectations for
380,000-388,000 head.

Technical Outlook

HOGS (APR) 03/07/2005: Rising stochastics at
overbought levels warrant some caution for bulls. The major trend could be
turning up with the close back above the 18-day moving average. The market tilt
is slightly negative with the close under the pivot. The next upside target is
76.800. The next area of resistance is around 76.150 and 76.800, while 1st
support hits today at 75.170 and below there at 74.820.
 

COCOA MARKET RECAP

3/4/2005

May Cocoa finished up 31 at 1760, 2 off the high and 37 up
from the low.

Cocoa closed higher today as the dollar fell off
sharply in response to this morning’s payroll reports that was not a strong as
many had hoped. The weaker dollar has been underpinning the cocoa market lately,
along with concerns over a reduced crop, labor problems and renewed strife in
the Ivory Coast. Funds were active buyers today, as May cocoa traded to its
highest level since it peaked on November 10th of last year.

Technical Outlook

COCOA (MAY) 03/07/2005: Studies are showing
positive momentum but are now in overbought territory, so some caution is
warranted. The major trend could be turning up with the close back above the
18-day moving average. A positive setup occurred with the close over the 1st
swing resistance. The near-term upside target is at 1790. With a reading over
70, the 9-day RSI is approaching overbought levels. The next area of resistance
is around 1779 and 1790, while 1st support hits today at 1741 and below there at
1713. 

COFFEE MARKET RECAP

3/4/2005

May Coffee closed up 1.00 at 124.05. This was 2.30 up from the
low and 0.95 off the high.

May coffee closed 100 higher on the session and
up 665 points for the week as London futures soared to new contract highs for
the 5th session in a row. Funds were active buyers in London for the week as the
drought in Vietnam continues to worsen. Talk that some irreversible damage is
occurring for in the key province of Daklak, Vietnam helped to support. German
buyers are going hand to mouth and hoping for a good corrective break from fund
selling in order to book more needs but slow producer selling is keep a firm
tone to basis levels.

Technical Outlook

COFFEE (MAY) 03/07/2005: A bullish signal was
given with an upside crossover of the daily stochastics. Stochastics are at
mid-range but trending higher, which should reinforce a move higher if
resistance levels are taken out. The cross over and close above the 18-day
moving average indicates the longer-term trend has turned up. The upside closing
price reversal on the daily chart is somewhat bullish. The market has a slightly
positive tilt with the close over the swing pivot. The next upside target is
126.95. The next area of resistance is around 125.65 and 126.95, while 1st
support hits today at 122.45 and below there at 120.50.
 

SUGAR MARKET RECAP

3/4/2005

May Sugar closed down 0.11 at 8.87. This was 0.05 up from the
low and 0.17 off the high.

May sugar closed 11 lower on the session and 16
lower on the week with speculative long liquidation selling helping to pressure
futures to the lowest level since late December. While there is hope that major
buyers like China, Russia and India could come in to buy cash soon, the slow
near-term demand and talk of another record crop from Brazil this season which
could be 8-12% above last years record cane crop helped to keep the market in a
long liquidation mode. Drought in Thailand has reached 70 of the countries 76
provinces and government agencies have been instructed to not supply water for
Agricultural needs. An internal document for discussion purposes shows that if
the beet crop planted acreage is left mostly unchanged this year that EU
exportable surplus sugar could jump to 3.9 million tonnes from 2.7 million this
year.

Technical Outlook

SUGAR (MAY) 03/07/2005: Daily stochastics
declining into oversold territory suggest the selling may be drying up soon. The
close below the 18-day moving average is an indication the longer-term trend has
turned down. The outside day down is a negative signal. The defensive setup,
with the close under the 2nd swing support, could cause some early weakness. The
next downside target is now at 8.68. The next area of resistance is around 8.98
and 9.12, while 1st support hits today at 8.76 and below there at 8.68.
 

COTTON MARKET RECAP

3/4/2005

May Cotton finished up 0.71 at 51.23, 0.02 off the high and
0.88 up from the low.

The market pushed higher again on Friday with
continued talk that China planted acreage could be down 10% this year and that
China cotton production might drop 10-20% this season as China producers shift
to other crops. Surging world demand for cotton is expected for the coming year
as Asia economic growth, continued active textile demand from the west and a
significant shift in demand to cotton and away from higher-priced polyester
helped to support. With soaring polyester prices, improving demand for cotton
and government subsides, mill demand in the US is even on the rise as mill
profitability is supporting better than expected usage.

Technical Outlook

COTTON (MAY) 03/07/2005: The crossover up in the
daily stochastics is a bullish signal. Studies are showing positive momentum but
are now in overbought territory, so some caution is warranted. The major trend
could be turning up with the close back above the 18-day moving average. Market
positioning is positive with the close over the 1st swing resistance. The
near-term upside objective is at 51.91. The market is approaching overbought
levels with an RSI over 70. The next area of resistance is around 51.68 and
51.91, while 1st support hits today at 50.78 and below there at 50.12.