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Precious Metals Distribution Finally Capitulates in a Plunge

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Patterns had reached inflection points that required resolving sharply without further delay.

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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: Gold's sudden break Tuesday wasn't so sudden. A distributive pattern has been forming since last week's peak at the corrective bounce's target.

Dollar Basket
Jun Contract DX; (NYSEARCA:UUP), (NYSEARCA:UDN)
Tuesday's recovery back up to 83.10 can't afford to hesitate in order to avoid resuming the decline.

Eurodollar
Jun Contract EC; (NYSEARCA:FXE)
Monday needed to be the bounce's peak to maintain the corrective bounce template. Tuesday's immediate reaction down has been too muted to confirm it is not only noise, and that momentum is actually reversing down.

Gold
Apr Contract GC; (NYSEARCA:GLD)
Tuesday's sudden $26 tumble was the break that had been likely for Monday's open - not necessarily so substantial, but every bit as sudden. Buyers never exploited the delay, keeping the door open to resuming the decline. Now that 1574.50 is being tested, bounces should hold any test of 1581.00-1583.00 to maintain potential for resolving down under 1570.00 to test 1550.00.

Silver
May Contract SI; (NYSEARCA:SLV)
The consequence to not rejecting Thursday's break under 28.33 by Friday's close could have been limited to Monday's fresh low at 27.80. But Tuesday's plunge to 27.15 only assures a recovery will be delayed by at least one more lower close.

30-year Treasury
Mar Contract US; (NYSEARCA:TLT)
Tuesday's open still didn't gap up, so the rally still didn't extend. But now that the consolidation has persisted for so many consecutive sessions, gapping up is unlikely for extending the rally to 145-14 / 145-22.

Crude Oil
Apr Contract CL; (NYSEARCA:USO)
Tuesday's dip repeated Monday's pattern, including a recovery to at least test 97.00. But the delay in resuming the rally at this stage of the pattern is only diminishing the potential for extending durably through its 99.00 target.

Natural Gas
Apr Contract NG; (NYSEARCA:UNG), (NYSEARCA:UNL)
Without immediately rejecting Monday's retest of 3.97 Tuesday, there is no greater likelihood of extending to fresh highs.

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.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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