Daily Spot

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 That answers that, sort of… Currencies gapped open to key levels Monday morning, threatening to reverse recent trending. The opens were retraced entirely intraday. Tuesday’s action extended the retracements, back through their origins from Friday’s close. Monday’s open was a “warning shot across the bow” that recent trends will soon reverse, regardless of one more trend extreme being  in-play.

Dollar Basket Mar Contract (DX, ETF: (UUP, UDN)) Monday’s 79.10 low bottomed upon filling the gap back to Friday’s close. That didn’t prevent Tuesday’s session from extending lower, to new relative lows at 78.58. But last week’s 78.75 prior low was still being tested at the close, so sellers gained no traction for the extra effort. If there were another new low, its origin would require a complete recovery.

Eurodollar Mar Contract (EC, ETF: (FXE)) Tuesday’s probe of higher highs up to 1.3272 closed above 1.3200 to signal a fresh high in-play at 1.3333. If there is no second consecutive higher confirming close Wednesday, then a quick reversal back down to Monday’s ~1.3030 low would become likely.

Gold Apr Contract (GC, ETF: (GLD)) Despite retesting Monday’s 1714.00 low down to 1712.60, Tuesday’s open held the critical 1720.00-1720.00 support to launch a rally to the 1748.00 objective. It was tested already intraday, up to 1752.60. A second consecutive higher close Wednesday would put into play 1778.00. There is otherwise no unfinished business above, and closing back under 1740.00 would trigger a new downleg.

Silver Mar Contract (SI, ETF: (SLV)) Tuesday’s gap down soon recovered from 33.15 back through Monday’s 33.77 close, to retest last week’s 33.37 prior highs. Its outperformance vs. Gold persists.

30-year Treasury Mar Contract (US, ETF: (TLT)) Having completed its corrective bounce to 143-16 Monday by touching 143-17, the pattern became vulnerable to resuming the decline to fresh lows next targeting 141.28. While I did not expect the corrective bounce to resolve in only one day, which it did, I still did not expect the drop to resume the next day. Which it did, by touching 141-27. Regardless, closing under 142-05 would signal the downleg has resumed, next targeting 140-00. Closing above 142-12 would trigger a retest of 142-24.

Crude Oil Mar Contract (CL, ETF: (USO)) Monday’s rejection of Friday’s corrective bounce left much to be desired at its 96.22 close. That could have been provided by sufficient weakness Tuesday. Gapping down to test 96.00 started things right, but that was quickly reversed up to fresh highs above 99.00. Any higher close would target 100.50, whose recovery would target 103.00 and 111.00. But closing back under 97.80 would resume the decline.

Natural Gas Mar Contract (NG, ETF: (UNG)) Early strength touched the 2.61 buy signal, but reversed down sharply instead of surging through it. That’s the very definition of an “inflection point.” The inflection was already productive, probing back under Monday’s low to 2.45. That allows a rally to be credible, but it must begin by recovering 2.61.

[/pay]

Share your questions and comments on this post in the blog, or in the chartroom…

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 Currencies started the week with a warning shot across the bow. Probably a taste of things to come, but is there room for one new trend extreme, first?

Dollar Basket Mar Contract (DX, ETF: (UUP, UDN)) Monday’s gap up held the 79.55 resistance from last week’s prior highs. The open reacted back down to fill the gap back to Friday’s 79.10 close. Friday’s close held as support, leaving no unfinished business below to attract price down. Now any close above Monday’s 79.65 high would trigger a new upleg targeting 81.50.

Eurodollar Mar Contract (EC, ETF: (FXE)) Monday’s gap down to 1.3045 held its test of last week’s prior low. The reaction up filled the gap back to Friday’s 1.3145 close. There is no unfinished business above to attract price higher, not without closing above the 1.3200 area which would put into play 1.3333.

Gold Apr Contract (GC, ETF: (GLD)) An overnight bounce to the 1740.00 objective launched another drop Monday to fresh lows down to 1714.00. The close held 1720.00-1722.00, which had been support during the rally targeting 1748.00. This probably robbed buyers of their traction, so that 1748.00 can be retested before a bigger downleg can begin.

Silver Mar Contract (SI, ETF: (SLV)) Monday’s gap down to prior lows at 33.00 was retraced entirely back into positive territory at 33.87. The reaction up suggests that a downleg is not quite yet ready to begin. But the gap down did create new business below — to retest its open — which will inhibit any recovery effort and probably cause its failure.

30-year Treasury Mar Contract (US, ETF: (TLT)) After Friday’s tumble, a corrective bounce was likely to test 143-04 up to 143-10 or 143-16. Monday’s gap up to 143-04 was retraced to fill the open’s gap, and then recovered to resume the corrective bounce. The 143-17 session high reacted down to end the session testing 143-10. The decline is free to resume, having completed the corrective bounce and holding its limit, although closing under 143-04 would have signaled it already.

Crude Oil Mar Contract (CL, ETF: (USO)) Friday’s corrective bounce reacted down immediately Monday, even if the reaction down did not necessarily resume the decline. But now, having corrected up, and then having reacted down to the correction, the appropriate behavior for resuming the decline would be to accelerate under 96.35 to new relative lows.

Natural Gas Mar Contract (NG, ETF: (UNG)) While Friday’s action helped to form a more durable bottom, it did not trigger a rally and it did not require Monday to trigger a rally. In fact, Monday’s action repeated much of the same pattern and continued to form a more durable bottom. Now any delay in rallying would start to undermine the recovery potential.

[/pay]

Share your questions and comments on this post in the blog, or in the chartroom…

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 Volatile reactions among currencies following the payroll report did not break out of their recent range, while S&Ps extended sharply higher. This might seem to be “decoupling,” but it is more likely the precedent to a major turn in both markets.

Dollar Basket Mar Contract (DX, ETF: (UUP, UDN)) The morning’s surge peaked upon filling the gap back to Tuesday’s 79.40 close. Reversing into negative territory may seem bearish, but the close was actually still testing Thursday’s close. A fresh high above 79.40 would launch a new rally leg, but there is potential for intraday probes under prior lows first.

Eurodollar Mar Contract (EC, ETF: (FXE)) Its intraday tumble could be associated with the Greek PM’s threat to resign if no debt deal was reached immediately. Public disavowal of the statement helped 1.3090 hold its test as support to avoid triggering a downleg. Closing above 1.3215 would still target 1.3333.

Gold Apr Contract (GC, ETF: (GLD)) After firming initially to pierce Thursday’s high up to 1766.00, the balance of the morning reversed down under 1748.00 to test 1740.00. A plunge after the close tested 1727.40. Momentum has reversed down, but there is potential for a bounce back to 1740.00 or even to 1748.00 before a bigger slide begins.

Silver Mar Contract (SI, ETF: (SLV)) Friday’s lower ranging session was not too much harder hit after the close. This suggests that its own trending will be difficult to begin without Gold first resolving its corrective bounce described above.

30-year Treasury Mar Contract (US, ETF: (TLT)) Friday’s plunge from 144-16 on the Employment report does not really equate to the gap down I had described. But its immediate reaction settled at the gap’s target around 143-04. The balance of the session tested both 142-12 and 142-05 in two distinct moves, closing back above both. A corrective bounce testing 143-04 up to 143-10 or 143-16 is likely.

Crude Oil Mar Contract (CL, ETF: (USO)) Friday’s gap up consolidated just under the gap back to Wednesday’s 97.55 close, until a very late surge probed higher. Wednesday’s 97.55 close was still being tested at the close, so buyers gained no traction for their efforts. But the decline should resume without much if any delay Monday if still valid.

Natural Gas Mar Contract (NG, ETF: (UNG)) Thursday’s rally was corrected Friday down to 2.45. The afternoon rallied back to nearly touch Thursday’s 2.56 close before dipping. A lot of selling pressure was satisfied or trapped, and the afternoon’s recovery still contained enough pessimism to be bullish from a contrarian perspective. While the 2.61 buy signal did not trigger, the upside potential remains intact.

[/pay]

Share your questions and comments on this post in the blog, or in the chartroom…

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 Are CrudeOil and Natural Gas reversing their roles? While Crude Oil is now breaking under support to new relative lows, Natural Gas is bouncing off of support and perhaps also launching a new upleg.

Dollar Basket Mar Contract (DX, ETF: (UUP, UDN)) Fluctuating narrowly around unchanged Thursday does not add to any pattern that may be forming. But it does reflect pessimism — which is potentially bullish from a contrarian perspective — for not being attracted higher to fill the gap back up to Tuesday’s 79.40 close. Any initial strength Friday would be credible for extending higher, and for launching a new upleg.

Eurodollar Mar Contract (EC, ETF: (FXE)) Thursday’s gap down nearly filled the gap back to Tuesday’s 1.3092 close. The optimism that prevented it could be bearish from a contrarian perspective. Absent a close above 1.3215 to reinstate momentum for the 1.3333 target, closing under 1.3090 would suggest at least a corrective drop is underway./

Gold Apr Contract (GC, ETF: (GLD)) Shallow bounces weren’t gaining traction. Neither was neutralizing unfinished business above, which kept reacting back down under prior highs. But sellers never gained traction either by reacting back down under prior lows. Buyers exploited that Thursday by firming to fresh highs at almost 1764.00. Now a pullback has room down to 1745.00 area without yet signaling momentum has reversed down. There is otherwise no active buy signal.

Silver Mar Contract (SI, ETF: (SLV)) Thursday morning’s action eventually trended up to probe fresh highs up to 34.35. A reaction down back under prior highs was recovered back above them to test 34.20. While this action is more vulnerable to extending higher, there is no active buy signal.

30-year Treasury Mar Contract (US, ETF: (TLT)) Wednesday’s “inside day” did not produce any meaningful reaction Thursday. The session fluctuated relatively narrowly around unchanged. Recovering 145-05 would still trigger a probe of fresh highs targeting 145-28 and potentially 146-22.

Crude Oil Mar Contract (CL, ETF: (USO)) Gapping down to fresh lows and extended down throughout the day helped Thursday’s price action confirm Wednesday’s close under prior lows. Bounces should now hold tests of 96.70 to maintain the break’s momentum. The bounce limit may be probed to fill the gap back to Wednesday’s 97.60 close, but it must be rejected.

Natural Gas Mar Contract (NG, ETF: (UNG)) Without bothering to probe under two week-old prior lows, Thursday’s action absorbed the negative knee-jerk reaction to EIA that touched 2.34, then rallied back up to 2.57. Closing above 2.61 Friday would confirm a bottom has formed, and that momentum is reversing up, with potential on this leg up to 3.03.

[/pay]

Share your questions and comments on this post in the blog, or in the chartroom…

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 edit

Dollar Basket Mar Contract (DX, ETF: (UUP, UDN)) Tuesday’s test of Monday’s 79.55 resistance had kept alive the requirement for at least one more new low in the decline. There was not much of a wait, as Wednesday’s open gapped down to test the 79.00 prior lows. Lower lows testing 74.75 fulfilled the pattern’s next measured support. There is no more unfinished business below, but not yet a bottoming pattern in place.

Eurodollar Mar Contract (EC, ETF: (FXE)) Wednesday’s open gapped up to test 1.3175 resistance, and eventually extended higher to fill the gap back to Friday’s 1.3215 close. There is no unfinished business above, but potential to extend higher to test 1.3333 so long as 1.3150 holds as support.

Gold Apr Contract (GC, ETF: (GLD)) Wednesday’s open immediately fulfilled the required retest of Tuesday’s 1744.40 opening gap. The balance of the session ranged sideways, further suggesting that the rally had run into difficulty. Closing under 1730.50 would signal momentum reversing down.

Silver Mar Contract (SI, ETF: (SLV)) Like Tuesday’s gap up, Wednesday’s gap up was under prior highs. Its sponsorship is weak hands. The rally may yet extend above 33.60 to 34.60, but a close under 33.00 could launch a new downleg.

30-year Treasury Mar Contract (US, ETF: (TLT)) Wednesday’s “inside day” dipped from testing 145-10 resistance back down to Tuesday’s 144-09 low. Back above 145-05 would target 145-28 and 146-22. After testing either — preferably from at least above 146-00 — reversing down to close in negative territory would seal a top.

Crude Oil Mar Contract (CL, ETF: (USO)) Tuesday’s complete retracement of its huge opening gap up did not extend down immediately Wednesday. But the morning’s shallow bounce did resolve into new lows. A second consecutive lower close Thursday would launch a new downleg. Any delay would be considered bullish.

Natural Gas Mar Contract (NG, ETF: (UNG)) The reaction down continued Wednesday after Monday’s premature test of the rally’s 2.81 target. Although not required, the gap back to the 2.40 low close was filled. There is potential for extending to a new low under 2.33 unless 2.48 were recovered first. The EIA reports inventories after Thursday’s open.

[/pay]

Share your questions and comments on this post in the blog, or in the chartroom…