Gold's Rally Hits Its Target, but Can It Meet Another?

Minyanville

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: Gold extended its rally Monday to fulfill the minimum higher objective, and to fulfill the requirement for one more higher close. The next higher objective was not exceeded so no higher targets are in play. The rally must essentially resume without delay and aggressively to maintain its traction.

Dollar Basket
Dec Contract DX; (UUP), (UDN)
Monday's gap up and enter session spent in positive territory was almost "ineffectual optimism" - except for there not being a fresh high in the afternoon, let alone its rejection.

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Eurodollar
Dec Contract EC; (FXE)
Despite Monday's open gapping down, the 1.3770 sell signal was attacked but not triggered. A retest of last week's 1.3885 high may be needed to create a slingshot effect.

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Gold
Dec Contract GC; (GLD)
The 1360.00-1362.00 target area was almost thoroughly tested Monday. Negative territory was being probed overnight, and the target didn't hesitate long to push back down, so the rally's strength is suspicious.

Silver
Dec Contract SI; (SLV)
Monday's "inside day" did not attempt to fill the gap back up to Thursday's higher close, which Friday's opening gap down created. Trending down without yet testing, it or probing Thursday's high, is difficult at this stage of the pattern.

30-Year Treasury
Dec Contract US; (TLT)
Sideways ranging Monday continued expending buying pressure without gaining any traction for the effort, and without trapping shorts below to refuel the rally. That usually means a fresh high will still print, but the prior high is likely to hold and then reverse momentum down.

Crude Oil
Oct Contract CL; (USO)
Friday's corrective bounce extended slightly higher Monday. It wasn't aggressive, and still suggests that a recovery cannot proceed without at least a retest of last week's lows.

Natural Gas
Oct Contract NG; (UNG), (UNL)
Thursday's abrupt reversal up from barely touching the minimum 3.55 target, and avoiding one more fresh low close, both made Friday's gap up and test of 3.70 not credible. In fact, Monday's open gapped down sharply back to test 3.56, still likely to at least test a fresh low.
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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