Financials
Stocks: Stocks really took it on the chin this week. While many are pointing to the mid week rally off of the low as a sign that we have put in a temporary bottom, I would not be so quick to agree with that. Because the market has not been able to follow through at all above 10,900 shows me that this bear is resting not turning. I expect continued downside movement in stocks this coming week and 10,500 is not as much of a long shot as some might think. We have already exited 50% of our bear put butterfly spread for over a 130% return per spread. I will be holding the rest of them into next week with 10,500 being my dream target but I would be thrilled if we traded anywhere below 10,750. Buy or spread puts if you havenââ,¬â"¢t already as this bear is just getting started.

Bonds: Bonds have rallied above 108 and for now the path of least resistance remains up. As stocks continue to deteriorate you will see the old flight to quality argument raised again and that will of course continue to push bond prices higher. While I am bullish bonds I am not a wild bull so trade this market with caution.

Energies
Crude oil had a wild week but seems poised to resume the uptrend we have been in for some time now. I expect to see $75 hit within the next two weeks, heating oil will likely rally above 2.10 as well. Todayââ,¬â"¢s break out in Unleaded can be seen as a leading indicator of where energy prices are headed in the short term. Natural gas continues to be the dog of the group but I expect this market to begin to turn higher in the very near term. This market has now corrected over 60% since the Katrina highs.

Metals
Metals have had a huge jump in volatility this week and I expect this volatility to continue, however I do not expect the current sell off to continue much lower. In fact I see these markets turning around this coming week as we get closer to the Fed meeting. Look for Gold to find itââ,¬â"¢s way back towards 650 and silver should get back above 12.00. Copper continues to very extremely volatile and I will be standing aside until things calm a bit. Overall expect metals to support out and begin to turn back up this coming week. Derek Frey 06/09/06

Grains
Grains continue the one step forward two steps back dance this past week. While they tried a few times to stage a rally they a fizzled out and broke down. I remain bullish but since I am trading options it is easy to hold on during these back and forth times. By the end of the summer I expect grain prices to be substantially higher.

Softs
OJ continues to build a very solid bullish consolidation pattern. Bull spreads in OJ are advised as the path of least resistance is up during Hurricane season. Cocoa has built what looks like a solid base and bull spreads here are also advised. Buy 1500 calls for Sep. and sell 1700 calls against them is one easy long term bull trade. Coffee hit and so far has supported out at 95 just as I mentioned here a few weeks ago. Aggressive traders should buy here with stops below 92.00. Sugar has not yet staged any real bounce but support seems to finally be holding and I am cautiously optimistic that this market will start to see higher prices in the not too distant future. Cotton continues to be strong, today we saw a double top formed on the daily chart but I do not expect that resistance point to hold. I am expecting a move towards 55 this week.

Meats
After a very nice uptrend, the cattle market has begun to correct. I would expect this correction to continue into this coming week but in the long run I will be buying this dip. Hogs are still on a wild run but the weakness in cattle could spill over into pigs this week so tighten up you stops.

Forex Currencies
EUR/USD: The Euro broke down below channel support one day before options expiration. I do not think of this move as anything other than a head fake. I am buying this dip and holding long this week. First upside target is 1.2750.

USD/CHF: The bounce continues and I still expect to see 1.2400 prove to be resistance in the near term, so shorts should start to look at entering on moves above 1.2325

GBP/USD: The cable continued its slide this past week as expected, I maintain that we could see 1.83 before staging any real bounce. I am getting ready to reverse and go long most likely this week so be ready to catch this bounce and longs put on near 1.8365 should do well by the end of the week.

USD/JPY: We did manage to hit my target of 114 and resist out so far from there. We may push a bit further towards 115 but ultimately I am expecting this market to reverse in the near term.

AUD/USD: We sold off a bit more than I would have liked but this market is already starting to reverse and rally. I am quite bullish this pair and think we could easily see .7600 by weeks end.

USD/CAD: This market continues to very volatile with a lot of two sided trading. This is indicative of a market that has reached a long term turning point. I am not quite ready to call an all out bull market yet but I am looking at more and more signs that the turn is near. Long Call options in this pair are the safest way to position for the reversal while limiting risk.

Matt Odom is the Managing Partner and Energy Analyst and Derek Frey is Head Trader at Odom & Frey Futures & Options.

Risk Disclaimer 
Past performance is not indicative of future results. Trading futures and options is not suitable for everyone. There is a substantial risk of loss in trading futures and options.