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Retracing Crude Oil's Dip Monday Should Launch a Rally

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Gold's persistent volatility is inhibiting crude oil from attracting speculative 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: Gold's persistent volatility is inhibiting crude oil from attracting speculative action. Regardless, Friday's break lower was the expected first step to stretching the rubber band so it may snap back and launch a new upleg.

Dollar Basket
Mar Contract DX; (NYSEARCA:UUP), (NYSEARCA:UDN)
Friday's gap up to new highs at 82.58 may have formed an island, which would trigger a downleg by gapping open back down under 82.10. The rally could otherwise extend higher so long as 82.25 holds as support.

Eurodollar
Mar Contract EC; (NYSEARCA:FXE)
The pre-open retest the week's prior test of 1.3020, this time down to 1.2967. The close was back to testing 1.3020, which undermines the decline's momentum. Back above 1.3105-1.3113 would signal momentum reversing up and potentially targeting 1.3185 and 1.3300.

Gold
Apr Contract GC; (NYSEARCA:GLD)
Thursday night's $15 plunge to new lows at 1564.00 stopped short of the 1562.50 objective before bouncing into positive territory Friday morning to test 1584.00 resistance. Its reaction down was still testing 1575.00 whose break would maintain the decline's momentum

Silver
Mar Contract SI; (NYSEARCA:SLV)
The pre-open new lows under 28.00 were recovered back into positive territory up to almost 28.80 at Friday's open, but no higher, as the balance of the session drifted back down to test 28.50 support. Back above 28.65 would again trigger a new rally leg or credible attempt. The trend otherwise remains down.

30-year Treasury
Jun Contract US; (NYSEARCA:TLT)
Friday's open gapped up to 144-22 resistance and held there. To the extent that the open's gap was in reaction to falling stocks, then not reversing down in reaction to stocks recovering suggests again that the bond doesn't yet intend to reverse down. That would be much likelier had the close also recovered 144-14 instead of still testing it. Back under 143-20 would be credible for extending down.

Crude Oil
Apr Contract CL; (NYSEARCA:USO)
Presumably the first break from crude oil's narrow range is down, as was most likely. Now, recovering 92.40 would signal it was a false break, reversing in the opposite direction up much more substantially.

Natural Gas
Mar Contract NG; (NYSEARCA:UNG), (NYSEARCA:UNL)
Friday's noise offered no new parameters.

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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