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.

Friday’s Highlight Gold’s long-awaited new low close takes the pattern to a new phase. The assumption remains that the decline is ongoing, while introducing potential for a corrective non-noise bounce, which would be vulnerable to becoming a new ongoing rally.

Dollar Basket Dec Contract (DX, ETF: (UUP, UDN))
Similar to Tuesday’s surge that was constrained by its two-day old high, Friday’s surge held Thursday’s 81.56 high. Is it a top? Thursday’s opening gap up was neutralized. None of which precludes trying to extend higher, but closing back under Thursday’s 80.70 low would start to signal the trend reversing down.

Eurodollar Dec Contract (EC, ETF: (FXE))
Friday retraced almost all of Thursday’s post-open session-long bounce, testing Thursday’s deep opening gap down at 1.3367. The test held, so Thursday’s breakout attempt was not confirmed, as is is appropriate following the similar Tuesday-Wednesday sequence. None of which precludes lower lows Monday, but all of which suggests the decline is nearing a low — and that recovering Wednesday’s 1.3550 high would launch a new rally leg.

Gold Dec Contract (GC, ETF: (GLD))
Friday’s resumed Thursday’s breakout attempt that had held above 1306.00, plunging to 1280.50. The pattern’s outstanding minimum objective of a third lower close has been fulfilled. None of which requires a bottom or even a trading low, but there is a vulnerability at least to bouncing, since Friday’s low filled the gap back to October 16’s 1282.00 close. Bounces need to hold 1300.00-1301.50 to maintain the decline’s momentum, next targeting 1274.50 and 1268.50.

Silver Dec Contract (SI, ETF: (SLV))
Sympathy with Gold’s drop was limited to retesting 21.35 which was had been attacked and tested the two prior sessions. Bounces should hold 21.55-21.66 to maintain the 20.70 target.

30-year Treasury Dec Contract (US, ETF: (TLT))
Thursday’s unconvincing rally up to 133-28 was rejected by the reaction to Friday’s Employment Situation report, plunging through the Tuesday’s 132-24 low to 131-18. The test of month-old prior lows could produce a bounce up to “higher prior lows” at 132-30 before resuming the decline to 129-30. Closing above 133-08 would start to signal a bigger corrective bounce underway.

Crude Oil Dec Contract (CL, ETF: (USO))
The decline did not extend Friday, but the 94.60 bounce limit continued to hold, keeping alive the attraction to retest last week’s lows down to 92.85.

Natural Gas Dec Contract (NG, ETF: (UNG, UNL))
Friday’s bounce doesn’t change the pattern’s near-term thesis, that more bottoming must preceded a credible rally. Friday’s high retraced 61.8% of the drop from Thursday’s high, which is natural resistance. Friday’s high also retested Thursday’s opening gap up, neutralizing its attraction above. Some sort of retest of 3.44 down to 3.37 remains likely. Otherwise, a fresh high that closes above 3.63 would start to suggest a bigger bounce is underway, anyway.

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