Monday, June 1, 2009

S&P Breakout?

Stocks appear headed higher this morning on news that China's manufacturing has expanded for the third straight month. Markets world-wide rallied while the Dollar and Bonds continued their declines.

Oil continued to surge, up over $1 moving in on $68. The dollar broke below 79 on the Dollar Index while 10 year rates rose to 3.59%.

Our plan is to sell S&P calls at overbought levels above 933. We remain delta neutral on the 10 years and await the Fed to come in and push down the rates before we reestablish short positions in Notes and Bonds.

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