Daily Spot: Interest rates
A weekly summary of one complex, including daily updates of other developments elsewhere.[pay]
30-year Treasury Mar (USH) Too little, too late. Last Friday’s gap was never filled (highlighted pink) before falling back to the already thoroughly tested 120’14 support (highlighted green). Now it is being tested as resistance after the drop had extended down.
That extension down had retested the gap back to 119’18 (circled red) that had been filled already. Its retest was unnecessary, if not unlikely, for a recovery. And breaking it puts into play a lower target at 118.00.
Thursday’s bounce was an inside day sloped upward, which typically resolves down. It’s also untimely optimism ahead of so weighty an event as Friday’s Employment Situation report. Only a close above 121’14 would invalidate the potential for new lows.
Dollar Basket Mar (DXH) Give it a rest, already. A third consecutive strong intraday move is unlikely, and even less likely to extend. Especially when the series contains a move from one end of the range to the other. Fresh highs Friday would be very vulnerable to reversing back down, potentially to attack 80.00.
Gold Feb (GCG) Losing more glitter. Sellers still haven’t lost traction. At least Thursday’s bounce stopped pessimistically short of touching 1378.00 instead of failing to hold a probe above it. But new lows – and potentially a new downleg next targeting 1320.00‘s test – would be in-play under 1365.00. Otherwise, a corrective bounce would target 1387.50-1390.00 and 1403.00-1404.00.
Crude Oil Feb (CLG) Bulls starting to get the picture. Peaking Wednesday just short of its 91.00 corrective bounce target raised it to 91.70. Thursday’s drop probed fresh lows, which ultimately held on a closing basis. While that robbed traction from intraday sellers, it requires another corrective bounce to being immediately to avoid extending down sharply into and out of the weekend.
Natural Gas Feb (NGG) Coffee break’s over? Pre-EIA optimism was punished as usual. The first recovery attempt failed, and the gap back to last Friday’s 4.40 close was filled. A bullish resolution – resuming the rally in strong fashion – can’t afford to hover at these lower levels.
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Daily Spot coverage schedule is: Currencies (Mon), Metals (Tue), Energies (Wed), Rates (Thu), Softs (Fri, coming).