Daily Spot: Energies
A weekly summary of one complex, including daily updates of other developments elsewhere.[pay]
Crude Oil May (CLK) Don’t get too comfy up here. Wednesday was another day of ranging around this upleg’s 108.25-108.50 target, ranging that began Sunday night. Not yet having reacted down negatively, a negative reaction now would be suspicious, and probably a buying opportunity for recovering to one more higher high. Otherwise, probing a fresh high and then closing negative would start to confirm a top has been forming.
Natural Gas May (NGK) Down, for now. Tuesday’s close under 4.25 was still above last week’s lows that had also tested 4.25. But that didn’t prevent extending down Wednesday to fresh lows at 4.15. Now 4.30 must be recovered just to avoid extending the drop further, next targeting 4.07.
Dollar Basket Jun (DXM) Couldn’t avoid lower lows, and maybe still can’t. Monday and Tuesday’s optimistic lows – that attacked last Thursday’s 75.94 low without probing it – made it unlikely to avoid dipping more aggressively down to 75.75 or 75.50. Gapping down and extending lower Wednesday morning soon began testing 75.75, which lasted through the close. Its 75.69 low stopped optimistically short of filling a 2-1/2 week-old outstanding gap, so lower lows remain likely.
Gold Jun (GCM) Confirmation, sort of. Wednesday’s open gapped up and firmed further to quickly fulfill its next higher target at 1463.50. A pullback intraday fell to within a few dimes of the 1455.00 target as support. Buyers didn’t gain traction since the 1358.30 close was under the 1461.40 opening print. So, despite being the second consecutive new high close, its confirmation of Tuesday’s breakout is suspicious. At least a pullback to 1447.00-1449.00 is becoming likelier.
30-year Treasury Jun (USM) Sellers brought it, anyway. It’s surprising that Wednesday’s selling produced a close under 119’25. Last week’s tests of the critical support were rejected by bounces. But Tuesday morning’s failed gap up kept the trap door open, and Wednesday’s session fell through it by losing nearly a full point to close under 119’00. A second consecutive lower close Thursday would confirm the breakout, next targeting 117.00.
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Daily Spot coverage schedule is: Currencies (Mon), Metals (Tue), Energies (Wed), Rates (Thu), Weekender (Fri).