Bigger Picture
Livestox Recording Dec 11, 2015
The webinar broadcasting software would not initiate, so I recorded a Livestox with the stock requests that were made to the blog. They are addressed in the order below. Please don’t hesitate posting follow-up questions to this blog post’s thread.
SPX — Ongoing decline has reached the precipice.
USO — The potential for a bottom.
GLD — 1074 in the underlying is relevant.
XAU — Is there a Descending Triangle and false break?
SIL SLVP — Is this the beginning of the end, or end of the beginning?
GPRO — Tax loss selling is creating a January Effect candidate.
TWTR — Tax loss selling is creating a January Effect candidate.
FEYE — Tax loss selling is creating a January Effect candidate.
SUNE — Probably less of a January Effect candidate than suspected.
CARA — Monitoring for a new pattern since bounce target met.
AMMJ — Making a break from its Cup & Handle pattern.
GWPH — Fresh low now makes the next surge credible.
TRTC — New lows targeted.
INSY — Impressive bounce from the recent negative news reaction.
SPRWF — 3rd day surge missed, but that’s not necessarily bearish.
Daily Spot…
A daily summary of high-profile members of several complexes… View a more detailed discussion of each chart at the end of today’s Market Wrap.
Eurodollar Dec Contract (EC, ETF: (FXE, UUP))
Rather than extend the corrective pullback any deeper first, Friday’s bounce filled the gap back up to Wednesday’s 1.1020 close. This is more suggestive of topping, so that the next decline is durable. Rejecting a probe above Wednesday’s high would have been more bearish, and still could be.
Gold Feb Contract (GC, ETF: (GLD))
Sliding sharply to attack 1061.50 support from Thursday’s close under 1074.00 was reversed up sharply to test 1077.77. Now a recovery is even more dependent on holding 1074.00 as support, if not also there being no delay to extending up through 1077.70.
Silver Mar Contract (SI, ETF: (SLV))
Friday’s gap down was within the prior range, but that didn’t prevent extending to fresh lows intraday. The pattern was not very responsive to Gold’s recovery, ending under prior lows. Its downside risk is in being confirmed by a second consecutive lower close Monday.
30-year Treasury Jan Contract (US, ETF: (TLT))
Delaying and backing-and-filling from attacks on the 156-12 target better enabled its eventual test to extend through it Friday. The breakout is next targeting 157-22 so long as pullbacks hold 157-04 as support. Closing under 156-15 would reverse the trend back down.
Crude Oil Jan Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Extending down overnight to test the 36.25 target wasn’t rejected to close back above 36.70, which would have sealed a bottom. But the new low at 35.35 into the weekend reflects excessive pessimism when there is often a geopolitical risk premium. It is not quite a second consecutive lower close, but it is at least a breakout.
Natural Gas Jan Contract (NG, ETF: (UNG, UNL))
Two consecutive lower closes into the weekend now require at least an eventual third lower close.
Look ahead: Economic Calendar – for Mon Dec 14, 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: No reports are due Monday, which isn’t much more quite than the week prior to it.
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
Daily Spot…
A daily summary of high-profile members of several complexes… View a more detailed discussion of each chart at the end of today’s Market Wrap.
Eurodollar Dec Contract (EC, ETF: (FXE, UUP))
Wednesday’s probe of fresh highs wasn’t likely to extend, but Thursday’s gap down under last week’s 1.0985 prior high hasn’t yet proved momentum is reversing down. A correction can fill the week’s two lower outstanding gaps below and then resume the rally. Retesting Wednesday’s high first would make the next downleg more durable.
Gold Feb Contract (GC, ETF: (GLD))
Gapping down Thursday back under 1074.00 support didn’t extend down, keeping the window open for a break above 1077.70 to extend higher intraday.
Silver Mar Contract (SI, ETF: (SLV))
Still hovering at or above the rally attempt’s original 14.10 target still makes a break above 14.35 likely to extend sharply higher intraday.
30-year Treasury Jan Contract (US, ETF: (TLT))
Hovering Thursday just under Wednesday’s highs maintains the upside momentum that still targets a fresh high at 156-12.
Crude Oil Jan Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
After having neutralized the attraction at Monday’s gap down, hovering narrowly just off recent lows all but ensures probing fresh lows down to 36.25. Recovering to close positive the same day would suggest a bottom had formed.
Natural Gas Jan Contract (NG, ETF: (UNG, UNL))
Thursday’s EIA report was not being greeted from a position of strength. But also not from a position of weakness, which didn’t prevent trending down gently in reaction to the news. An immediate reversal from this setup would not be credible.
Look ahead: Economic Calendar – for Fri Dec 11, 2015
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: Friday’s PPI is already high-profile and infulential to price action, but releasing it simulteneously with Retail Sales can create either contradiction, or reinforce a surprise. Reaction to the post-open Consumer Sentiment should duplicate any reaction to the pre-open reports.
*PPI-FD
8:30 AM ET
Retail Sales
8:30 AM ET
Business Inventories
10:00 AM ET
*Consumer Sentiment
10:00 AM ET
Baker-Hughes Rig Count
1:00 PM ET