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Daily Spot – If, Then… Market Timing

Daily Spot

By Rod David | November 8, 2011 - 4:33 pm

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.

Dollar Basket Dec (DXZ) “Ineffectual pessimism”? The open gapped down and the entire session ranged in negative territory, but prior lows held tests as support. And the critical 76.80-77.00 area still did not break lower. Fresh strength above 77.40 would be credible for extending higher, but would also require a relatively tight trailing stop. Meanwhile, there is potential for a 1-2 day probe lower.

Gold Dec (GCZ) Monday’s rally extended into Tuesday, finally probing 1800.00. This second consecutive higher close would normally confirm a breakout, except for the two-day sequence preceding it that did not confirm Thursday’s breakout. An immediate reversal down is unlikely to gain traction without first absorbing a bounce off of 1778.00. If so, watch Silver for it outperforming from rotation into it, to help predict broader topping.

Silver Dec (SIZ) Tuesday’s fresh highs filled the high’s gap while also retesting the rally’s 35.50 target. This reserved optimism makes more fresh highs likelier first, than to reverse down yet sustainably. Watch for Gold to underperform simultaneously from rotation out of it, to help predict broader topping.

30-year Treasury Dec (USZ) Gapping down nearly 1 point Tuesday, then bouncing to fill the gap back to Monday’s close, would have cleared the way for a deeper downleg to follow Wednesday. But Tuesday afternoon already fell back to fresh session lows, suggesting that impatient selling had cleared the way for one more bounce. Closing negative Wednesday and under 140’16 would make 143’04‘s test unlikely anytime soon.

Crude Oil Dec (CLZ) The probing above 94.00 extended higher again Tuesday, testing 96.67 resistance. Closing under 93.75 would signal momentum reversing down.

Natural Gas Dec (NGZ) Monday’s opening gap down was retested after a bounce back above prior highs. Tuesday afternoon recovered back to fresh session highs. This could be the basis for a rally, attracted higher first to fill the gap back to Friday’s 3.78. Closing above 3.85 would signal momentum reversing up.

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Posted in Daily Spot