Crude Oil and Gold Met Long-Standing Targets at Tuesday's Lows

Rod David
November 12, 2013

The following are the latest daily summaries of my ongoing intraday coverage, providing context to interpret price action. Any prices listed are for a contract's current "front month." Their direction tends to correlate with any ETFs listed for each.

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Today's Highlight: Tuesday's price action fulfilled the likelihood for volatility to expand considerably after Veterans Day. That likelihood encompasses Wednesday, too. Having fulfilled so much selling pressure at Tuesday's lows, could the ongoing volatility take the form of reversing up sharply Wednesday?

Dollar Basket
Dec Contract DX; (UUP), (UDN)
Tuesday's choppy session fluctuated narrowly around unchanged, essentially confirming that Monday's dip gained no traction to reverse momentum down. More interesting was the lack of trending while other major markets like crude and gold slid sharply.

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Dec Contract EC; (FXE)
Tuesday's firmer session differed from Monday only slightly in price, and not much otherwise. Both gapped up slightly, traded flat, and remained entirely within Friday's range. As noted above, not trending diverged from so many other markets, suggesting that the lows would be attacked if not also retested.

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Dec Contract GC; (GLD)
Filling the month-old gap, Friday allowed at least a corrective bounce to form, but Monday's narrow ranging resolved down sharply on Tuesday, as the decline extended through its next targets to test 1260.00. The decline's momentum remains intact so long as bounces now hold 1268.50, and back above 1274.50 would signal momentum reversing up.

Dec Contract SI; (SLV)
Tuesday's resumption of the decline from testing the 21.35 target extended down to and through its 20.70 target. Closing back above 20.70 would at least start to suggest the drop's momentum has ended.

30-year Treasury
Dec Contract US; (TLT)
Fresh lows Tuesday tested a relevant support at 131-08. Closing back above 131-26 would start to signal momentum may be reversing up, so long as pullbacks then held 131-14 as support.

Crude Oil
Oct Contract CL; (USO)
Monday's retest of the bounce limit resolved down Tuesday to fresh lows, fulfilling the longstanding 92.85 target to within $0.01. Closing back above 93.50 would be the minimum requirement to begin suggesting the decline's momentum has ended. Back above 94.60 would signal the trend reversing up.

Natural Gas
Oct Contract NG; (UNG), (UNL)
Unfinished business below, no upside attractions, and lack of momentum did not prevent Tuesday's open from gapping up to fresh highs. Ultimately, 3.63 held its test as resistance, leaving no time or room for delaying a retest of the lows.
Editor's note: Rod's analytical techniques are designed to efficiently identify targets and turning points for any liquid stock or market in any time frame. He applies his techniques live intraday, primarily to S&P futures, at RodDavid .com.

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