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Daily Spot: Interest rates – If, Then… Market Timing

Daily Spot: Interest rates

By Rod David | February 10, 2011 - 6:20 pm

A weekly summary of one complex, including daily updates of other developments elsewhere.[pay]

30-year Treasury Mar (USH) When is a bounce not a bounce? Two consecutive sessions of probing new lows and closing back above 118’00 robbed sellers of their traction. Each of these session’s created a vulnerability to a corrective bounce. Thursday’s gap down weakened further, for an inside day. Recovering 118’00 would target 119’04 up to 119’16. But almost any delay in bouncing Friday would be bearish.

Dollar Basket Mar (DXH) When is bullish too bullish? Thursday did everything needed to trigger the inverted Head & Shoulder pattern. The open quickly recovered 77.85, and the session also probed 78.25 and 78.33. But the latter’s recovery was not maintained through the close. And Thursday’s gap up creates unfinished business back to Wednesday’s close. The intraday high didn’t probe fresh highs, pessimism that helps to off-set the open’s optimism. A retest of 77.85 that recovers to close above Friday’s high would be bullish.

Gold Apr (GCJ) How long can metal float? Thursday’s gap down was fully recovered, neutralizing its attraction, instead of leaving buying pressure to become pent-up overnight. Resuming the rally Friday is more difficult, but it is still possible since 1361.50 held as support through the close to maintain potential to 1376.00.

Crude Oil Mar (CLH) Was the leak plugged? Another probe up into Monday’s range was rejected back to the gap at Tuesday’s open. This continues to undermine buyers. The drop remains vulnerable to resuming, and targeting 84.00. Potential there for a durable bottom to produce a significant upleg.

Natural Gas Mar (NGH) Has the well run dry? Friday’s lower lows were much more in keeping with the spirit of rewarding Monday and Tuesday for its breakout and confirmation. But there is still no bottom pattern forming. A bounce has room up to 4.13 while still being likely to resolve down.

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Daily Spot coverage schedule is: Currencies (Mon), Metals (Tue), Energies (Wed), Rates (Thu), Weekender (Fri).

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