Daily Spot

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Today’s Highlight It’s working already! Crude Oil dropped nearly $3 from yesterday’s high. This was only one day after the announcement of a crackdown on its speculators. One day after having gapped up ahead of the crackdown threat. But one day does not a make a trend.

Dollar Basket Jun Contract (DX, ETF: (UUP, UDN)) The rally was free to resume, and Wednesday’s open did gap up sharply to test 80.00. But the gap back down to Tuesday’s 79.62 close was soon filled, and the balance of the session ranged just above it. While the rally could still resume, Wednesday’s false start suggests at least a little more intraday weakness coming first.

Eurodollar Jun Contract (EC, ETF: (FXE)) Despite Tuesday’s hesitation suggesting one more fresh high was likely to test 1.3200, Wednesday’s open gapped down to 1.3100 and through support. Closing any lower would signal a new downleg underway, but the gap back to Tuesday’s close was filled. There remains potential to test 1.3200.

Gold Jun Contract (GC, ETF: (GLD)) Tuesday’s recovery from its deep 1635.00 intraday lows was not necessarily bearish. And it wasn’t bullish enough to offset being a second consecutive lower close under 1657.00. But it did earn enough respect that gapping open Wednesday above 1661.00 would have still been bullish. Nevertheless, Wednesday’s open gapped down, testing and retesting 1640.00, suggesting a new downleg was underway.

Silver May Contract (SI, ETF: (SLV)) Ranging Wednesday between 31.45-31.75 continued to prevent any buy or sell signal from being identified.

30-year Treasury Jun Contract (US, ETF: (TLT)) Tuesday’s session-long narrow consolidation at 141-06 undermined its relevance as a sell signal. And although not required, Wednesday’s highs filled the gap back up to Monday’s 141-27 close. Now closing under 141-06 would once again be credible for triggering a sell signal targeting 139-08. There is otherwise no buy signal active.

Crude Oil May Contract (CL, ETF: (USO)) One day after testing the 104.70 bounce target up to 105.20, the gap back down to Monday’s 102.95 close was filled. The 102.25 support was tested. But the 102.25 support held. Now just closing above 104.70 would target 107.75 and potentially 111.75. Closing under 102.25 would still target 98.85.

Natural Gas May Contract (NG, ETF: (UNG)) Tuesday’s 1.94 new intraday lows were “ineffectual pessimism” for only testing Friday’s 1.96 prior lows. But Wednesday’s bounce to 1.99 was retraced entirely back down to 1.94, so no bottom has yet formed.

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A daily summary of high-profile members of several complexes…[pay] View a more detailed discussion of each at the end of today’s Market Wrap.

Today’s Highlight Crude Oil laughed off Tuesday’s announced efforts to reign in speculators. While the president was describing his plan, futures were about $1.50 higher to levels not seen in two weeks. It’s almost as if speculators aren’t really to blame for higher oil.

Dollar Basket Jun Contract (DX, ETF: (UUP, UDN)) Choppy ranging Tuesday around Monday’s lows did not impact the pattern. Nor did it extend the 61.8% pullback from Thursday’s low, still allowing for the rally to resume.

Eurodollar Jun Contract (EC, ETF: (FXE)) Tuesday ranged narrowly around the 1.3145 resistance that contained Monday’s rally. Not yet rejecting its test suggests that a higher resistance will be tested next, which would fill the gap back to 1.3200 — but probably not close above 1.3180. Closing under 1.3100 should instead resumed the decline.

Gold Jun Contract (GC, ETF: (GLD)) Gapping up Tuesday above 1661.00 would have resumed the rally. But 1657.00 held the gap up, launching an intraday dip to 1635.00. A second consecutive close under 1657.00 have confirmed that last week’s bounce had ended. But the afternoon’s $23 recovery to test 1658.00 leaves the door open to resuming the rally anyway, by gapping open Wednesday above 1661.00.

Silver May Contract (SI, ETF: (SLV)) Monday’s test of 31.45 launched another bounce Tuesday. Despite its gap up extending to 31.90, the gap back to Monday’s close was filled. Its reaction recovered back to session highs. But ultimately 31.75 held as resistance to prevent triggering a signal either way.

30-year Treasury Jun Contract (US, ETF: (TLT)) Since Monday’s close was testing last week’s 141-27 high, Tuesday’s gap down leaves no unfinished business above. Still, the sell signal is 141-06, and Tuesday ranged narrowly around it instead of triggering or rejecting it. Now a close under 104-22/104-29 would be needed to confirm momentum had reversed down.

Crude Oil May Contract (CL, ETF: (USO)) The long-standing 104.70 target was met by Tuesday’s gap up, after Friday and Monday’s pullbacks held tests of 102.25 support. Closing above 105.90 would signal a new upleg underway, next targeting 107.75 and 111.75.

Natural Gas May Contract (NG, ETF: (UNG)) Tuesday’s gap down under 2.00 rejected Monday’s bounce up to 2.02. The morning extended down to new lows under 1.95. The low was retested into the close. But more important is that the balance of the session ranged around Friday’s 1.96 lows. Sellers did not gain traction for their efforts. New lows are not a buy signal, but Tuesday’s pessimism could serve as a bottom.

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Today’s Highlight Gold started the week feigning further reaction down from last week’s bounce high. Any delay in confirming it Tuesday would be very bullish to resume the bounce.

Dollar Basket Jun Contract (DX, ETF: (UUP, UDN)) Despite gapping up to 80.30 at Monday’s open to probe last week’s highs, the balance of the session tumbled to test 79.70 support. This is a 61.8% retracement of the rally from Thursday’s low, and assuming that it is the pullback’s low, then back above 80.00-80.15 would launch a new rally leg.

Eurodollar Jun Contract (EC, ETF: (FXE)) Monday’s gap down under prior lows held 1.3020 support instead of breaking it. The intraday reaction up held 1.3145 resistance. So long as 1.3180 is not recovered, this bounce has likely peaked, and the downleg should soon resume.

Gold Jun Contract (GC, ETF: (GLD)) Monday’s gap down to 1648.00 reacted up to 1661.00, before fresh lows tested 1642.00. Despite the volatility and the lower and lower lows, the session closed while still trying to recover several dollars back above 1648.00. Gapping up Tuesday above 1661.00 is possible, and would be likely to resume the rally next targeting 1688.00. Otherwise, a second consecutive lower close under 1657.00 would confirm last week’s corrective bounce had ended.

Silver May Contract (SI, ETF: (SLV)) Friday’s low was tested throughout Monday afternoon once the firmer open was retraced. But the retracement stopped short of probing fresh lows. And 31.45 support was still being tested throughout, instead of its break triggering a sell signal. It’s not a buy signal, but the price action does keep the door open to another bounce.

30-year Treasury Jun Contract (US, ETF: (TLT)) Only slightly higher highs accompanied falling stocks Monday. That wasn’t much of a “flight-to-safety.” In fact, stocks bounced back into positive territory, and the long bond ended the session still testing the 141-27 prior high. Now closing under 141-06 would trigger a downleg targeting 139-08. There is otherwise no buy signal.

Crude Oil May Contract (CL, ETF: (USO))  Monday’s early $1.50 dip followed Friday’s close above 102.25, suggesting that sellers had not regained control. So does the dip’s complete recovery to close positive on the day. Back above 103.00-103.25 would target 104.70.

Natural Gas May Contract (NG, ETF: (UNG)) Ranging 2 cents either way around 2.00 Monday does help to form a bottoming pattern. There remains no unfinished business below. Any higher would target 2.07, whose recovery would target 2.17. There is not otherwise a sells signal.

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Today’s Highlight Bonds surged Friday, having left unfinished business above. And as was expected, the catalyst was falling stocks.

Dollar Basket Jun Contract (DX, ETF: (UUP, UDN)) Closing above 79.70 Friday would have signaled a new upleg underway. Friday’s open gapped above it, and extended sharply higher to test 80.05. Closing Monday above 81.10 would confirm a new upleg underway. This is likely, since Monday mornings tend to mimic Friday’s behavior in currencies.

Eurodollar Jun Contract (EC, ETF: (FXE)) Friday’s open gapped down to 1.3145. It had served as resistance twice earlier in the week. Thursday’s gap above it tried to trigger a breakout, which a second consecutive higher close would have confirmed. Now a second consecutive lower close Monday would confirm a new downleg underway.

Gold Jun Contract (GC, ETF: (GLD)) The gap back to last Tuesday’s 1672.00 close was filled Thursday. It was exceeded through the close up to 1681.00. The bounce’s 1688.00 target might not be met. Friday’s reaction tested 1657.00-1661.00 support down to 1650.00. Closing back above 1661.00 Monday could renew the rally effort. Otherwise, closing under 1657.00 would resume Friday’s decline, likely to probe recent lows under 1600.00.

Silver May Contract (SI, ETF: (SLV)) Having recovered 32.30 Thursday, it became support, and was required to hold to prevent the decline from resuming. Friday’s open gapped down to 32.30 and extended down sharply intraday to test 31.45. A second consecutive lower close Monday would put into play 29.50. Otherwise, a bounce off of 31.45 support would target 32.30.

30-year Treasury Jun Contract (US, ETF: (TLT)) The gap back up to 141-12 needed to be filled before a downleg could gain traction. This attraction above helped to absorb the initially negative knee-jerk reaction to Thursday’s auction. Falling stocks Friday helped to trigger a gap up that extended to 141-25, but ending the session while testing 141-12. The gap was filled, and another was created — below, at Thursday’s 140-15 close — to help attract price down and trigger a pullback targeting at least 138-20.

Crude Oil May Contract (CL, ETF: (USO)) Friday’s session-long weakness prevented fulfilling the 104.70 bounce target. Its reaction down failed to maintain 103.00-103.25 support, and the bounce’s momentum. But 102.25 did hold, which at least prevents sellers from gaining traction. The pattern remains unattractive until breaking beyond 98.85-104.70.

Natural Gas May Contract (NG, ETF: (UNG)) Seemingly “bad” news Friday (rising production during falling demand) had negligible effect on price action. This is probably only wider dissemination of news that has been driving price down. It’s not a buy signal, but it can be constructive to forming a bottom.

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A daily summary of high-profile members of several complexes…[pay] View a more detailed discussion of each at the end of today’s Market Wrap.

Today’s Highlight Gold followed one big target by surging sharply to its next. But now a shallow dip is unlikely to precede higher highs, and almost any delay in extending higher would be bearish.

Dollar Basket Jun Contract (DX, ETF: (UUP, UDN)) The delay in resuming the rally kept the door open to fresh lows. Thursday’s gap down extended back to prior support at 79.35. A lower low must hold 79.25 to avoid putting into play new lows under 78.90. Closing above 79.70 would signal a new upleg underway.

Eurodollar Jun Contract (EC, ETF: (FXE)) Not yet rejecting Wednesday’s test of prior highs allowed Thursday to rally even higher. The gap back to last Tuesday’s 1.3220 close was barely filled, and not rejected, suggesting a higher high will also test 1.3285. Otherwise, closing under 1.3145 would signal a new downleg underway.

Gold Jun Contract (GC, ETF: (GLD)) The first breakout attempt from consolidating narrowly around the 1661.00 target was going to be the false breakout. And it was down. Thursday extended the rally sharply higher and fill the gap back to last Tuesday’s 1672.00 close. Higher highs tested 1681.00, presumably on the way to 1688.00 so long as there is no hesitation.

Silver May Contract (SI, ETF: (SLV)) Wednesday’s test of 31.45 support launched another rally leg through 32.30, which must now hold as support to maintain potential to 32.90-33.00.

30-year Treasury Jun Contract (US, ETF: (TLT)) Despite surging in Tuesday’s flight-to-safety, price was unaffected by Thursday morning’s stock market rally. Apparently optimism was high ahead of the day’s auction. An initially negative knee-jerk reaction left outstanding the gap back to 141-12, whose attraction helped it recover from 140-01 back to unchanged around 140-24. Stocks continued rallying, and bonds continued avoiding a sell-off, further suggesting the 141-12 gap intends being filled, one way or another. Stock market sell-off, perhaps?

Crude Oil May Contract (CL, ETF: (USO)) The 104.70 bounce target was attacked to within 50 cents Thursday. Its reaction down held 103.00-103.25 to maintain the bounce’s momentum.

Natural Gas May Contract (NG, ETF: (UNG)) Price action under $2 got very choppy, and unstable, but did not extend the decline any further. That is not a buy signal, but a bigger intraday spike up — whether or not maintained — would suggest a bigger was forming.

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