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 A funny thing happened on the way to reversing the Long Bond’s gains… Tuesday’s gap down was recovered back up to last week’s highs. Did a flight-to-safety from weak stocks delay a bigger drop, or is the next leg up?
Dollar Basket Mar Contract (DX, ETF: (UUP, UDN)) The rally’s 81.80-82.20 target area has been tested repeatedly, but not very thoroughly. Closing back under 81.05 would start to signal that buying was fully absorbed, and that momentum was reversing down. The rally otherwise remains intact, 82.20 in-play.
Eurodollar Mar Contract (EC, ETF: (FXE)) A window has opened for the Euro to bottom. Last week’s retest of the prior Sunday night’s gap down had opened a window, but buyers crawled through it much too optimistically for a rally to generate solid sponsorship. Friday’s drop to new lows fulfilled the decline’s long-awaited 1.2650 objective. Now, closing above 1.2750 and 1.2825 would signal another recovery effort. But much more of a delay would simply resolve down.
Gold Feb Contract (GC, ETF: (GLD)) Bounce potential to 1665.00 was fulfilled Thursday. Its retest Tuesday reacted down only slightly, suggesting that fresh highs will test the next resistance at 1683.50. But closing under 1647.00 would signal momentum reversing down.
Silver Mar Contract (SI, ETF: (SLV)) Two weeks ago I was tracking a multi-session consolidation that was coiling strength, awaiting an explosion higher. It did come, gapping up sharply. But there has been no follow-through higher since then — only intraday brief probes of fresh highs that have failed — despite Gold extending. There is no requirement to play “catch-up,” but I would expect rotation at some point to extend the rally.
30-year Treasury Mar Contract (US, ETF: (TLT)) Friday’s bounce to 145-11 retested the two-week old high. And not just any old high, but the high of an extended rally, whose rejection produced sharply lower lows and a lot of volatility. Tuesday’s open gapped down to test 144-05, then recovered to almost touch Friday’s high. There is potential for probing yet higher, but nothing compelling at this stage. Meanwhile, closing under 144-05 would signal momentum reversing back down to last week’s lows.
Crude Oil Mar Contract (CL, ETF: (USO)) Last week’s retest of the rally’s 103.00 target again reacted down, this time after Nigeria’s “bullish” news failed to produce much buying pressure. While there remains potential to launch another upleg targeting 111.00, the pattern has yet to prove whether it is accumulation or distribution.
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