The yield on the 10-year US Treasury may be ready to test the 3.75% level as indicated by two technical indicators - the 50-day EMA and the small cloud formation. However, the mid-month retreat pattern following each month’s NFP data may be close to having run its course.




After registering an island doji candlestick on Monday, the VIX moved up 4% in yesterday’s session and the MACD chart segment indicates a positive divergence which suggests that the momentum low on the downside readings in the near term may have already been seen.



As discussed yesterday, price development on gold is evolving in harmony with the nested cup and handle patterns which have been in evidence in multiple time frames. The $1125 level is a key to watch on any pullback, and, for the longer-term bulls on the metal, this would be an area to be looking to add to positions. An upward breakout would almost certainly move fast, but the short squeeze scramble would entice many opportunistic traders to play a significant upward breakout and expect a ride back to the mid $1200’s.



On an intraday basis the DAX index, is just about managing to prolong its steep ascent but there is some suggestion that some traders may be getting vertigo attacks prior to the US markets opening when the trusted algorithmic bias keeps propelling equities in their parabolic ascent.



A couple of weeks ago I commented that Seagate Technology (STX) had a bearish looking pattern from an Ichimoku and volume perspective, and the situation has deteriorated more recently and a short position would be worthy of consideration.



Last week I suggested that XSD had been building a head of steam at its highs and that a breakout could be imminent. The upbeat earnings from Intel could propel this sector further upwards today - but on any significant breakout I would immediately take 50% out of the trade and insert a trailing stop on the balance.



Also discussed here recently, MBT still seems to be capable of registering a double top pattern but it would need to do so soon and a relatively tight stop loss is advised.



Clive Corcoran is the publisher of TradeWithForm.com, which provides daily analysis and commentary on the US stock market.