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 The weekend brought a different perspective to many markets Monday, or at least extended the perspective from Friday afternoon. There are opportunities to extend, even if only temporarily such as with Crude Oil. But mostly, one end of a range was tested aggressively without breaking out, such as with Gold and and Bonds.
Dollar Basket Dec Contract (DX, ETF: (UUP, UDN)) Friday’s consolidation above prior highs had suggested it would at least try extending higher Monday. But the open gapped down and slid through the 81.00-81.05 support whose defense last week launched the new high. A second consecutive lower close signal momentum reversing down. Otherwise, filling the gap back to Friday’s 81.33 close could resume the rally.
Eurodollar Dec Contract (EC, ETF: (FXE)) Friday’s drop had neutralized the prior two days’ ineffectual optimism above 1.2800, while also neutralizing the open gap back to last Tuesday’s 1.2700 close. Either the drop would extend mercilessly, or a durable bottom may have formed. Monday’s gap up above Friday’s range probed last week’s highs further above 1.2800. Too much, too soon? A second consecutive higher close would confirm momentum had reversed up, but there is otherwise another downleg about to begin.
Gold Dec Contract (GC, ETF: (GLD)) Not closing under 1714.50 to signal a new downleg underway left the pattern vulnerable to an updraft. That came Monday by gapping up to test 1727.00 resistance. It extended higher, but a second consecutive higher close is needed to signal anything more substantial in-play.
Silver Dec Contract (SI, ETF: (SLV)) Monday’s open gapped up to and through last week’s highs, which had attacked 33.00. The session extended higher, but needs a second consecutive higher close to confirm the rally has resumed. I’m suspicious otherwise.
30-year Treasury Dec Contract (US, ETF: (TLT)) Friday’s breakout attempt was rejected by Monday’s gap down to 151-18 support. An intraday dip to 151-04 was retraced to test 151-18 into the close. Now a close under 151-04 is needed to confirm momentum has reversed down, or else a retest of last week’s highs would be likely.
Crude Oil Jan Contract (CL, ETF: (USO)) A delayed reaction to Middle East hostilities? The week opened in rally mode. Ending last week back at 87.25 (basis Jan, 86.70 basis Dec) prior highs simplified extending higher to test 89.60 (basis Jan, 89.00 basis Dec) resistance. A higher high up to 90.65 is likely so long as pullbacks now hold 88.50.
Natural Gas Dec Contract (NG, ETF: (UNG, UNL)) Thursday’s wild intraday swings were still being absorbed Monday, but trending is now free to resume by closing above 3.80.
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