Daily Spot: Energies
A weekly summary of one complex, including daily updates of other developments elsewhere.
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Crude Oil Nov (CLX) Wednesday’s gap up didn’t gain traction -the afternoon was spent testing both a prior high and the 83.25 prior target – and that left an outstanding gap back to Tuesday’s close. These are bearish elements that will attract price back down. Eventually.
First, a retest of the 84.00 area is likely, possibly even a probe of new highs. The pattern has now formed a Complex Triangle, and potentially a Double Top with interim upsloping consolidation, either having a bearish resolution.
Natural Gas Nov (NGX) Wednesday’s open gapped up above 3.65-3.67 and extended higher to 3.77. The gap back to Tue close was filled by a mid-day dive to 3.63. With no unfinished business below, a reaction bounced up to 3.73 closing above 3.65-3.67.
Similar to Tuesday’s close that was still testing Friday-Monday’s “higher prior lows” as resistance, Wednesday’s close was in the process of testing two-week old higher prior lows. There being no unfinished business below, immediate strength is all but required, and would be credible for gaining traction to 4.10 and 4.28.
Gold Dec (GCZ) Extended pessimism had made higher highs likely, and Wednesday’s steep rally fulfilled all expectations and more. The gap back to last Thursday’s open and its prior highs were tested up to the 1370.50 target. And that was probed by$5, allowing room to test 1383.50 before fulfilling the Complex Triangle and reversing down.
30-year Treasury Dec (USZ) Wednesday’s close was amazing but not an amazing session. A gap down probed lower lows well under 133’06-133’08 – which could have been probed to no end intraday without consequence, so long as it was recovered on a closing basis. And it was, probed to no end and then recovered. Last-minute action is always suspicious, so follow-through Thursday would confirm whether the late recovery trapped shorts to squeeze higher for 135’20.
Dollar Basket Dec (DXZ) Tuesday’s ultimate rejection of Monday’s recovery attempt was rejected even further, retesting prior lows. At least, touching the upper-end of the structure that contained the low. The gap down and session-long ranging in negative territory is almost “ineffectual pessimism” (a new low intraday would have completed the setup). That’s enough for a recovery to begin, but it is not at all a signal that a recovery is beginning.
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Daily Spot coverage schedule is: Currencies (Mon), Metals (Tue), Energies (Wed), Rates (Thu), Softs (Fri, coming).