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Daily Spot – If, Then… Market Timing

Daily Spot

By Rod David | July 8, 2011 - 5:22 pm

A weekly summary of high-profile members of several complexes.[pay]

Dollar Basket Jun (DXM) Excessive this optimism is not a sell signal. Thursday’s reversal into negative territory was still clinging to Wednesday’s lows. This prevented sellers from gaining traction and preserved the corrective bounce’s potential to 75.85-75.90. It also didn’t prevent Friday’s open from gapping up. This second consecutive gap up was also reversed into negative territory – testing Thursday’s lows – but closed positive. The corrective bounce’s momentum remains alive so long as 75.30 holds as support on a closing basis.

Gold Aug (GCQ) Sellers stretched to the max, and ready to snap back. Friday’s surge confirmed that Thursday’s relatively narrow range had not deprecated the corrective bounce’s momentum. The surge’s 1546.00 high was consolidated back down to 1540.00 through the close. Back under 1537.00 would signal momentum reversing down, probably very aggressively if valid. Otherwise, the bounce could extend to probe prior highs above 1560.00.

30-year Treasury Sep (USU) Bigger slide delayed, not averted. Avoiding a negative reaction to Employment Situation report allowed Friday’s session to bounce. Its 124’18 bounce target was probed up to 125’00, and could extend up to 125’12. Regardless, this action is still considered to be only a corrective bounce.

Crude Oil Aug (CLQ) False break, after all. Thursday’s gap up came after Wednesday’s failure to confirm Tuesday’s gap up. Thursday’s close reflected no net gain from the open’s gap up, despite probing fresh highs intraday. The excessive optimism had lost traction. Friday’s gap down easily extended down intraday to within 1 tick of 95.50. Closing under 94.25 would still trigger a test of 91.00, which could form a durable bottom.

Natural Gas Aug (NGQ) Raising the bar. Friday’s rally back to stopped short of recovering 4.25, which would have helped to seal a bottom. Prior lows at 4.19-4.20 were still being tested as resistance, buying some time for closing Monday above 4.30 to signal momentum reversing up. No bottom or recovery is signaled otherwise.

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