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 Bonds and currencies did an about-face Friday that suggests their moves Thursday were absorbed — the bond’s deep drop, and the Euro’s gap up were each retraced entirely. The action defines a trading range that has yet to resolve, but should resolve powerfully by mid-week.
Dollar Basket Mar Contract (DX, ETF: (UUP, UDN)) Although Thursday’s break under 79.85 had invalidated the near-term attraction to 80.50, that was quickly overcome by Friday’s gap up back through 79.85. A second consecutive higher close would confirm that 80.50 remains in-play.
Eurodollar Mar Contract (EC, ETF: (FXE)) Thursday’s suspicious rally was rejected by Friday’s gap down under Thursday’s 1.3340 low. Now there is an attraction above, back to Thursday’s 1.3380 gap. Filling it first or else retesting the 1.3260 first, should hold and launch a more substantial move in the opposite direction.
Gold Feb Contract (GC, ETF: (GLD)) Friday’s flat-to-lower ranging back down to the 1685.00 prior highs doesn’t invalidate the rally’s momentum, but it does threaten it if the rally doesn’t resume almost immediately Monday.
Silver Mar Contract (SI, ETF: (SLV)) Probing fresh highs above 32.00 Friday and holding 31.65 as support intraday does maintain potential for extending next to 32.50.
30-year Treasury Mar Contract (US, ETF: (TLT)) Gapping up to and through 145-16 Friday invalidates the drop’s near-term momentum, but not the drop’s potential to resume. A test of “higher prior lows” at 146-00 and filling the gap back to Wednesday’s 146-04 close can still neutralize any attraction above to allow the decline’s resumption. But closing above 146-04 would mean Thursday’s drop had ended a correction, and the rally was resuming.
Crude Oil Feb Contract (CL, ETF: (USO)) Thursday’s breakout didn’t extend any higher Friday, but neither was it retraced. An interim one-day dip down to 94.20 can’t be discounted, but 99.00 is targeted so long as no dip is any deeper or lasts any longer.
Natural Gas Jan Contract (NG, ETF: (UNG, UNL)) The rally extended Friday, still avoiding any refueling dip. Perhaps a dip to 3.37-3.44 would suffice at this point, but there is still risk for a bigger drop testing 3.25 before a durable rally could gain traction.
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