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Daily Spot: Metals – If, Then… Market Timing

Daily Spot: Metals

By Rod David | November 23, 2010 - 5:27 pm

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

Gold Dec (GCZ) The 1365.00-1372.00 bounce target’s lower-end had been retested after Monday’s close. Its first test had pushed back before Monday’s open. This made a test likely of the range’s upper-end, too. World events overnight facilitated the test, which extended through the cash session.

The range’s 1372.00 upper-end served as support to a consolidation through Tuesday afternoon. RSIs diverged negatively into the retest. A close back under 1372.00 would signal that buyers had lost traction. Closing under 1365.00 would signal momentum reversing down.

If sellers can’t gain traction soon, then the bounce could extend to test 1395.00. There is room for noise around 1395.00 up to 1399.00, and any higher would target 1409.00. World events are attracting buyers that are artificially driving price higher, and any lull or perceived resolution would help to pop the bubble.

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Dollar Basket Dec (DXZ) Time had all but expired for a fresh high to be part of extending the rally. A new high was required, but its delay was starting to suggest it would be only obligatory. Tuesday’s reaction to world events did produce the fresh high. Now the rally must extend higher without delay to prevent Double Topping with last week’s high.

30-year Treasury Dec (USZ) Monday’s test of 128’14 was missed by 1 tick, but Tuesday’s gap up compensated for it. Closing back under 128’14 would have robbed buyers of their traction, but a close under 128’03 is needed to signal momentum had actually reversed back down. If sellers don’t gain traction, there is potential to 130’12-130’16.

Crude Oil Jan (CLF) It was still too soon for a new downleg to begin, so Tuesday’s gap down to 80.55 was recovered up to 82.00. The recovery did not gain traction, but neither did sellers. The new downleg is not yet signaled, but it is free to begin.

Natural Gas Dec (NGZ) Tuesday’s gap down probed under 4.17, but the balance of the session trended up to 4.26. The gap back to Monday’s 4.27 narrowly avoided being filled, keeping optimism in-check to avoid becoming too extended and vulnerable to reversal.

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

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