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Don't Confuse a Sanguine Friday With Euro Stability


At least another intraday dive is likely Monday.

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: The euro's slide seemed a distant memory much of Friday. But ranging sideways around the low close into the weekend can imply a false sense of stability. Stability at this stage of the pattern requires obvious strength. If not recovering immediately to compensate for the delay, at least another intraday dive is likely Monday.

Basket Mar Contract DX; (NYSEARCA:UUP), (NYSEARCA:UDN)
Fresh highs intraday up to 81.70 still held 81.55 resistance, suggesting the rally had peaked, but not that momentum has yet reversed down.

Mar Contract EC; (NYSEARCA:FXE)
Room for noise down to 1.3145 was tested Friday morning before bouncing back into positive territory. The drop did not extend, but neither was it rejected.

Apr Contract GC; (NYSEARCA:GLD)
The 1575.00 pullback limit was thoroughly tested as support Friday. Resuming the corrective bounce might depend upon immediately recovering 1581.00 Monday.

Mar Contract SI; (NYSEARCA:SLV)
Friday's gap down, probed fresh lows at 28.35-28.40, and spent the entire session in negative territory, but ultimately held its test of Thursday's prior low. The afternoon's low even reacted up from testing the morning's low. This is "ineffectual pessimism," and would make any initial strength above 28.65 Monday likely to rally sharply intraday.

30-Year Treasury
Mar Contract US; (NYSEARCA:TLT)
Thursday night's reaction down held 143-18 support. Friday's inside day was suspiciously strong considering the stock market rally undermined any flight to safety. Ignoring other sell setups from lower levels throughout the week presaged the stock market weakness. The corrective bounce targeting 145-03/145-06 remains intact.

Crude Oil
Apr Contract CL; (NYSEARCA:USO)
Thursday's narrow ranging around 93.00 limited any recovery potential, so Thursday's lows were retested Friday down to 92.44. But the session could still be defined as ranging around 93.00. Any immediate recovery attempt would likely fail.

Natural Gas
The prior sessions' sideways ranging extended into the weekend.

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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