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 Mario Draghi followed Thursday’s words with deed Friday. After assuring markets that the ECB would defend the Euro to the death, new efforts were announced. That’s the good news. The bad news is that the impact of Draghi II was sustained only among stocks, while other intraday reactions were retraced entirely (currencies), modest (Gold), or non-existent (Crude Oil)..
Dollar Basket Sep Contract (DX, ETF: (UUP, UDN)) Wednesday and Thursday’s gap down did not trend down intraday, confirming that the drop has been only a correction. Friday’s knee-jerk reaction down was soon retraced entirely. Any delay in resuming the decline Monday would be likely to fill the gap back up to the rally’s high close.
Eurodollar Sep Contract (EC, ETF: (FXE)) Two consecutive session of gapping up and ranging sideways do not form a durable uptrend. Nor can they launch a durable uptrend. So, Friday’s spike up on Draghi II were ultimately and all too easily retraced entirely. Any delay in resuming the rally Monday would be likely to fill the gap back down to the decline’s s low close.
Gold Aug Contract (GC, ETF: (GLD)) The breakout’s 1622.00 target was tested up to 1626.60. Its reaction down still closed positive on the day to prevent sellers from gaining traction. Closing under 1614.00 would start to signal momentum reversing down.
Silver Sep Contract (SI, ETF: (SLV)) The potential to 26.75 was realized Friday, but its reaction down still returned to 26.50. Unless immediately recovered Monday, a test of fresh lows down to 26.00 remains likely.
30-year Treasury Sep Contract (US, ETF: (TLT)) Thursday’s delay in reacting down from the rally’s longstanding 153-04 target did not prevent Friday’s GDP triggering a gap down to Tuesday’s 151-22 prior low that extended down to 150-18. Draghi II comments triggered another plunge down to 149-08. Back above 150-14 would signal a corrective bounce underway.
Crude Oil Sep Contract (CL, ETF: (USO)) Another day spent ranging narrowly around the 90.00 buy signal without triggering it, undermines the credibility of 90.00‘s break being able to trigger a new upleg.
Natural Gas Sep Contract (NG, ETF: (UNG, UNL)) The 3.03 pullback limit test (basis Sep, vs. 3.05 basis Aug) was probed Friday down to 2.98, but 3.03 was still being tested into the close to prevent sellers from gaining traction.
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