Daily Spot: Interest rates

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

[pay]30-year Treasury Dec (USZ) Nothing about the recent corrective bounce was accumulative. It stopped short of its potential to 133’06-133’10 before stumbling, and now 131’25 is being tested as support. A break under 131’25 would signal the downleg had resumed, so closing back above 131’25 Friday would rob sellers of their traction and renew the potential to 133’06-133’10.

Otherwise, closing under 131’03 would confirm the break, next targeting the 127’00 and 125’20 areas.

The bigger picture depicted below is a Double Top that has already closed under its 61.8% retracement. The character of price action resuming the decline should be noticeably aggressive. So, falling from here only gently would undermine the downleg.

Gold Dec (GCZ) A corrective bounce was never able to trigger above 1347.40, before resuming the drop to sharply lower lows.

Crude Oil Nov (CLZ) Another corrective bounce was rejected, leaving no accumulative pattern or higher objectives to inhibit the downleg targeting 77.75.

Natural Gas Nov (NGZ) Wednesday’s failed shallow bounce never could have prevented the requirement to probe new lows. But no bottom could form without recovering above the prior lows, and that opportunity has passed.

Dollar Basket Dec (DXZ) Thursday’s bounce from filling the gap back to Monday’s close was only obligatory, and still too optimistic to yet launch a rally leg. Maintaining potential to test 76.65 first.

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