Don't Expect Immediate Bounce From Gold; Crude Oil Meeting Big Targets

By Rod David  OCT 23, 2012 3:15 PM

Plus a look at the dollar, euro, natural gas, and more.


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.

Today’s Highlight: Crude oil met its longstanding target Tuesday, and then some. Gold retested its prior low as expected, and then some. Immediately bottoming on such strong momentum is unlikely.

Dollar Basket
Tuesday’s gap up extended higher to retrace back to two-week-old prior highs. If its natural resistance were to trigger a reaction down, I would expect it to recover for a fresh high.

Dec Contract EC; (NYSEARCA:FXE)
Tuesday’s gap down extended back to its original 1.2955 support, which one week earlier had launched a gap up without any signal. Closing any lower would trigger a new downleg. There is otherwise no signal.

Dec Contract GC; (NYSEARCA:GLD)
Tuesday’s retest of the 1716.00 low was expected, regardless of how deeply it would be probed intraday. And it was probed deeply, gapping down to 1709.00 and extending at one point down to test 1705.00. But there was no extension or rejection, so a bottom here would depend upon gapping up back above 1716.00 and extending higher to form an Island of Tuesday’s range. Otherwise, if not gapping, Tuesday is likely to gap down.

Dec Contract SI; (NYSEARCA:SLV)
A retest of 32.00 was needed before a bottom could complete. Tuesday’s open gapped down through its 31.57 prior low and consolidated back up to 32.00. A break higher Wednesday would be credible for at least retesting 33.00 as resistance.

30-Year Treasury
Dec Contract US; (NYSEARCA:TLT)
Monday’s gap down held 147-00 support to keep alive the 148-00 corrective bounce target. Tuesday’s gap up to Friday’s 147-21 high quickly met 148-00, which held. There is no new signal.

Crude Oil
Dec Contract CL; (NYSEARCA:USO)
Tuesday’s gap down immediately fulfilled the longstanding 87.45 target, testing it down to 85.69, with room for noise down to 85.25. Almost any lower would target 82.40.

Natural Gas
Monday’s test of the critical 3.44 level was retraced enough Tuesday to test the original 3.50 buy signal. But the new 3.55 buy signal was only tested as resistance.

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.
No positions in stocks mentioned.

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