Daily Spot: Week ender.
A weekly summary of one complex, including daily updates of other developments elsewhere.[pay]
Dollar Basket Dec (DXZ) Thursday’s gap down had failed to recover intraday, but it didn’t extend lower, so it qualified as “ineffectual pessimism.” But its pent-up buying pressure wasn’t released Friday, despite recovering into the open from an overnight dip to fresh lows. Tuesday and Wednesday’s confirmed breakout still owe the market at least one fresh high above 79.60. Delaying the rally’s resumption past Tuesday’s open would suggest buyers had lost momentum.
Gold Dec (GCZ) Thursday’s bounce initially extended higher overnight, peaking $2 short of touching the 1365.00-1372.00 bounce target’s lower-end. The shallowness is in-line with weak hands sponsoring the correction, before a more concerted effort by strong hands triggers the next downleg targeting a break under 1320.00.
30-year Treasury Dec (USZ) Friday’s session-long rally wasn’t very productive except for avoiding a downdraft. That’s impressive enough considering the gap back to Wednesday’s 126’30 close was filled early. The long bond tends to repeat Friday’s action on Monday, so further modest improvement is likely. An attempted downleg probably would not be credible until the current bounce first tests 128’03 and preferably 128’14.
Crude Oil Jan (CLF) The spread between Dec and Jan contracts is about 45 cents. The drop’s target equates to 81.75-82.50, and its bounce target is 83.75. Thursday’s bounce to 82.90 was a reaction to having overshot the target Thursday. Monday should react similarly to Friday’s “ineffectual pessimism.” Its open gapped down and the entire session developed in negative territory without trending down. A fresh low Monday under 80.70-81.00 would likely be a buying opportunity.
Natural Gas Dec (NGZ) Thursday’s bullish recovery had finished just short of confirming Wednesday’s breakout, despite probing Wednesday’s highs. Friday compensated for the delay by gapping up and extending higher. The original recovery leg’s 4.17 target is being retested, and Friday’s higher high is essentially a breakout – the rally’s durability relies almost entirely on printing and maintaining higher highs Monday.
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Daily Spot coverage schedule is: Currencies (Mon), Metals (Tue), Energies (Wed), Rates (Thu), Softs (Fri, coming).