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Daily Spot: Metals – If, Then… Market Timing

Daily Spot: Metals

By Rod David | April 26, 2011 - 5:27 pm

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

Gold Jun (GCM) The accident stopped waiting to happen. Four consecutive sessions of “ineffectual optimism” were retraced entirely by Tuesday’s steep drop. Actually, almost all was retraced. Tuesday’s 1492.00 low stopped short of the sequence’s 1482.00 low. This misplaced optimism prevents the drop from completing, and indicates lower lows to come.

Dollar Basket Jun (DXM) Lacking momentum, the decline persists anyway. Gapping down Tuesday within the recent range then extended down to fresh lows. The session ended while still in the process of testing those lows, where a recovery into positive territory would have formed a bottom. Closing Wednesday above Tuesday’s 74.52 high could still form a bottom, but the trend otherwise remains down.

30-year Treasury Jun (USM) Big target met ahead of big day. The three-day narrow range finally broke higher Tuesday, and immediately fulfilled the 122’02 target. It was still being tested at the close, or at least not exceeded enough to put into play the next higher target. That signal will rely upon a second consecutive higher close Wednesday to confirm Tuesday’s breakout above its recent range. Otherwise, a meaningful top will likely have formed. Regardless, there’s a lot of buying pressure being satisfied ahead of a big day, Wednesday’s new FOMC format.

Crude Oil Jun (CLM) Not much interest in affirming the rally. Tuesday’s action ranged narrowly. This comes one day after narrowly avoiding a close under 111.65, despite the steep rejection from retesting the 113.00 target. Now a close under 111.65 could gain traction itself. But the likelier scenario would still retest Monday’s 113.22 opening gap up. EIA reports mid-morning Wednesday.

Natural Gas Jun (NGM) No more room or time to pause. The hesitation continued to consolidate recent gains, presumably refueling to test the bounce’s 4.55 target. A close above it would signal a much more significant rally underway.

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

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