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Crude Oil Is Starting to Look Attractive

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It should be obvious by Thursday's close that crude oil is attracting gold's action.

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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: I noted yesterday that gold's $35 surge reaction to Bernanke's first day of Humphrey-Hawkins testimony was probably an isolated incident. Wednesday's reversal confirmed that, already meeting its objective. Now gold should range choppily as it absorbs the volatility. So I expect it to be obvious by Thursday's close that crude oil is attracting gold's action.

Dollar Basket
Mar Contract DX; (NYSEARCA:UUP), (NYSEARCA:UDN)
Wednesday's gap down only tested lower prior highs at 81.55, whose break would target a temporary dip to 81.25 before retesting the 82.05 resistance.

Eurodollar
Mar Contract EC; (NYSEARCA:FXE)
Tuesday's ranging persisted through Wednesday, and narrowed. Back above 1.3140-1.3185 would target 1.3300, but only as a corrective bounce before resuming the decline.

Gold
Apr Contract GC; (NYSEARCA:GLD)
Wednesday's drop confirmed that Tuesday's reaction to Bernanke was an isolated incident. Having held 1618.00 resistance, the reaction probed under its 1595.50-1601.00 objective down to 1594.00. A bounce has room up to 1610.00, and a further dip has room down to 1584.00, without either one signaling trending underway.

Silver
Mar Contract SI; (NYSEARCA:SLV)
Wednesday's gap down extended to test 28.85, natural support where Monday's open had gapped up. The 29.85 objective remains in-play, preferably to be tested by the weekend if valid.

30-year Treasury
Mar Contract US; (NYSEARCA:TLT)
Not gapping down Wednesday back into 145-03/145-06 to begin a new downleg, the pattern followed its likelier path of ranging sideways to retest 146-06 resistance. Its reaction down filled the gap back to Tuesday's 145-16 close.

Crude Oil
Apr Contract CL; (NYSEARCA:USO)
Still ranging narrowly around 93.00, but starting to behave impatiently. The first trending attempt beyond either end of the 92.00-94.00 is likely to be false, and rejected more substantially in the opposite direction.

Natural Gas
Mar Contract NG; (NYSEARCA:UNG), (NYSEARCA:UNL)
No pullback from Tuesday's 3.42 close down to 3.36 intervened before Wednesday's open gapped up to 3.47 and extended higher intraday to 3.55. The lack of a pullback might be why the entire rally was retraced back down to 3.42. Now there is big resistance at 3.47, and an attraction outstanding back down to 3.30-3.33.

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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