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

Daily Spot: Interest rates

By Rod David | May 19, 2011 - 4:21 pm

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

30-year Treasury Jun (USM) So far, absorbing the selling. Closing under 124’20 would have signaled momentum reversing down. But it was touched Wednesday as support, making the new signal a close under 124’14. A gap down extended lower intraday to 123’23, but still recovered back up to 124’20. Now a close under 123’23 is needed to signal that momentum is reversing down. A bounce has room up to 125’06 before signaling another breakout attempt underway.

Dollar Basket Jun (DXM) Better be worth the wait. Sellers haven’t gained traction for their selling efforts since Friday’s high. Price action since then has ranged sideways, to flat-to-lower through Thursday. That should be sufficient – that should have been sufficient by Wednesday’s close – to resume the rally. Regardless, some sort of trending should be underway by Friday’s close, and it would be credible for extending in whichever direction

Gold Jun (GCM) Inside day, if even a day. Wednesday’s excessive optimism didn’t extend Thursday. The open’s gap down did not deteriorate any further, either. Instead, the session’s inside day recovered easily to fill the gap back to Wednesday’s close. While this bounce should still fail, it is vulnerable to probing fresh highs Friday morning.

Crude Oil Jun (CLM) Inside day dips back to support. Wednesday’s optimistic bounce didn’t extend higher Thursday. The session was an inside day that drifted back down toward Wednesday’s 97.90 intraday low. Gapping down Friday under 96.90 would be likely to trend down into and out of the weekend.

Natural Gas Jun (NGM) Half a buy signal is the same as none. Weakness ahead of Thursday’s EIA report extended down to a new low under 4.15 at 4.09. Despite bounce back up to 4.15, the balance of the session fell back to 4.09. Not producing a fresh low does allow a close above the 4.15 interim high to signal momentum reversing up, confirmed above 4.20. There is otherwise no buy signal.

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

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