Gold's Big Post-Close Drop Tested a Big Target
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: FOMC inhibited price action and then exacerbated it. Ultimately, many prices abruptly got in line with their patterns. Most notable were gold, currencies and the long bond. But not crude oil, which has to raise questions as to whether the pattern is on track.
Dollar Basket
Jun Contract DX; (UUP), (UDN)
Wednesday's pre-FOMC probing of prior lows still hadn't gained traction before suddenly reversing up sharply from 80.65 through the 81.00 buy signal to 81.65, above the past week's highs.
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Eurodollar
Jun Contract EC; (FXE)
Tuesday's probe above 1.3333 to 1.3400 was rejected abruptly on Wednesday's FOMC news back down under the past week's lows to 1.3270, reversing the trend down.
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Gold
Aug Contract GC; (GLD)
Wednesday's gap up tested 1373.00 through the close, before the FOMC news triggered a plunge back under the 1368.50 bounce limit to new lows under the 1351.00 target, and under 1340.00. The drop targeting new lows under 1290.00 remains in play so long as 1354.00 isn't recovered through Thursday's close - which is a very real possibility, having overshot the target only after regular trading hours.
Silver
Jul Contract SI; (SLV)
Wednesday's flat narrow ranging plunged to fresh lows testing 21.20 after the FOMC news. Its new low close makes an immediate bottom unlikely.
30-Year Treasury
Sep Contract US; (TLT)
The 138-30 61.8% retracement of last week's corrective bounce from 137-25 was retested Wednesday by a 1-point dip ahead of the FOMC news, which triggered the drop's extension back through last week's lows to test 137-16. It's vulnerable to extending lower Thursday to 136-20.
Crude Oil
Jul Contract CL; (USO)
Firming into Wednesday's open tested 99.20. Extending almost any higher would next target 101.25 and then potentially 106.50, so long as 97.50 holds any test as support.
Natural Gas
Jul Contract NG; (UNG), (UNL)
Wednesday's gap up to Tuesday's 3.95 high was not rejected, and closing above 4.00 would next target 4.15.
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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